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Is a social enterprise a non-profit making organisation?
Social enterprises trade like any other business and aim to generate a profit. That profit is then primarily reinvested into its social aim.
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What types of businesses can be set up as social enterprises?
The social enterprise sector is extremely diverse and includes businesses such as travel agents, childcare facilities, cafes, food co-operatives, employment agencies, charity shops, housing associations, theatre companies etc. There are no restrictions as long as the business has a social aim.
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What is the difference between a community enterprise and social enterprise?
There is no difference. Often the terms are used interchangeably.
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What is the difference between a community / voluntary organisation and a social enterprise?
A community/voluntary organisation runs activities for the benefit of their communities. To finance this, the organisation raises funds through grants/funding and sometimes donations.
Social Enterprises rely principally on trading to maintain their sustainability, rather than on funding and grants.
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What legal structure does a social enterprise have?
It is what a business does with its profits and that determines whether or not it is a social enterprise and not its legal structure and professional advise should be sought before deciding the structure which is right for you.
Examples of different legal structure taken by social enterprises are:
- Unincorporated associations
- Trusts
- Limited liability companies
- Industrial and provident societies
- Community interest companies
- Charities
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What is a community interest company (CIC)?
Community Interest Companies (CICS) are limited companies, with special additional features, created for the use of people who want to conduct a business or other activity for community benefit, and not purely for private advantage. This is achieved by a "community interest test" and "asset lock". Registration of a company as a CIC has to be approved by the Regulator who also has a continuing monitoring and enforcement role. (See www.cicregulator.gov.uk for more information).
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How are social enterprises managed?
Social enterprises are often managed by steering groups or management groups made up of community members, employees and other stakeholders. There is no specific management structure.
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Is there any financial support available for Social Enterprises?
Yes, there are businesses that specialise in providing finance for social enterprises and there are grants and funding available.
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Are there any well known examples of social enterprise?
You may be surprised to find out just how many businesses you have heard of that are actually social enterprises. Below are a couple of examples.
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The Big Issue: Magazine edited by professional journalists and sold by homeless people. It gives homeless people the chance to make an income, voice their opions and campaigns on their behalf.
To become a vendor you must be homeless or vulnerably housed. However The Big Issue recognise that for many people, being housed is only the first stage in getting off the streets. Therefore if a vendor needs to continue selling the The Big Issue, they may allow them to.
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Fifteen: Chef Jamie Oliver set Fifteen up in 2002. It is a restaurant which doubles as a training programme for disadvantaged young people interested in becoming chefs.
Many of the 16 to 24-year-olds accepted by the Fifteen Foundation have criminal backgrounds or have suffered from addictions or homelessness, but those who prove themselves passionate about food, as well as being committed and hard-working enough, are given a year-long work placement at the restaurant which if successfully completed can lead on to other opportunities.