Types of For-Profit Social Enterprises (DP IB Business Management)

• Social enterprises often develop creative and innovative solutions to social challenges

• By generating revenue social enterprises can become financially self-sustaining

• This financial independence reduces their reliance on donations and grants, making them less vulnerable to political and economic change

• Social enterprises  create jobs which supports economic development particularly in developing  communities

• They often provide training and employment which can lead to increased social mobility and better quality of life

• Social enterprises work with a wide range of stakeholders

• Achieving financial stability can be difficult, especially during the initial stages

• Balancing a social mission with making money can be a delicate balancing act
  

• Social enterprises have to navigate complex legal frameworks and tax structures

• It may be difficult to quantify and measure the success of social enterprise activities

• Social enterprises may find it difficult to grow

• Obtaining additional finance to expand into new markets or reach a larger audience is likely to be difficult

Employee Cooperative

Community Cooperative

Retail Cooperative

• Owned equally by workers within the business

• Each employee has a vote in business decisions

• Profit is shared equally between employees

• E.g. Flaskô in Brazil, which was purchased by its employees in 2003

• Owned by members of a local community

• Members usually contribute time as well as finance to the cooperative

• Profit is commonly reinvested to continue providing socially valuable products

• E.g. Hour Exchange Portland in the USA, a time-bank organisation

• A group of independent retailers come together and operate under one brand name

• Buying power is increased and marketing costs are shared

• E.g. DIY retailer ACE Hardware in the Philippines

Producer Cooperative

Financial Cooperative

Housing Cooperative

• Groups of manufacturers work together during the production process

• Sharing and maximising the use of expensive capital equipment is often a key aim

• Producer cooperatives are common in agriculture

• E.g. The German Wine Group cooperative brings together small wine producers in the country's main wine-producing regions

• Organisations that provide financial services to individuals that may not otherwise qualify for standard banking products

• Often focused on a particular community

• Social aims take precedence over profits

• E.g. in the UK, Medway Credit Union provides loans and savings facilities to those living with challenging circumstances

• Organisations that provide housing for members 

• Members collectively own and benefit from socially cohesive and lower cost dwellings

• E.g. Almost 30% of housing in Poland is owned through housing cooperatives with Spółdzielnia Mieszkaniowa in Warsaw being one of the most well-known housing cooperatives