Public sector spending cuts are leaving some of the most disadvantaged groups in our communities without the support they need. Not only are public services being withdrawn, but many charities, voluntary and community groups that have been delivering vital services to vulnerable individuals are struggling to keep going without grant aid. They are being encouraged to trade to generate the income they need; to become social enterprises.
Public sector workers are being encouraged to consider setting up social enterprises to deliver services that have previously fallen under the remit of Local Authorities or the NHS.
In addition to that there are entrepreneurs, young and old, setting up social enterprises to fill gaps they see in the market related to a whole range of environmental, health and well-being services.
By buying from these social enterprises you are helping them to survive and achieve their social or environmental objectives, helping to save the planet and enabling some of the most disengaged groups of people feel they have a stake in society.
The Story Behind Shop for Change
iSE conducted an extensive social enterprise and third sector market analysis survey between January and April 2010.
The survey, which was part of iSE’s MarketMakers initiative supported by Be Birmingham, was the first detailed examination of how social enterprises and other third sector organisations behave in the marketplace and revealed:
- 35% of social enterprises don’t buy any goods or services at all from within the third sector;
- Almost half spend less than 10% of their supplier-spend in the sector;
- Only 13% spend 10% – 30% of their supplier-spend in the sector;
- Less than 2% spend 50% or more of their supplier-spend in the sector.
Given the evidence, we wanted to do something about it. We’ve launched the Shop for Change campaign to raise awareness of the issue and help social enterprises, and other trading third sector organisations, find out about and support each other through their purchasing policies.
The survey also revealed that the public sector remains the dominant customer for social enterprises’ services, with 83% of the sample saying they derived 20% – 100% of their income from public sector customers. This means that the public sector spending cuts will hit the sector hard. So it must make sense for the sector to do more to support itself!
Download the full survey analysis here
The Barriers to Buying
The survey tells us that the key reasons why social enterprises and other third sector organisations are not trading more with each other are that:
- Social enterprise providers of the goods and services required do not exist – there are significant gaps in the market;
- Social enterprises, where they do exist, can be more expensive than their private sector competitors;
- Social enterprises, where they do exist, can be less convenient to use than their private sector competitors and can offer inferior quality goods and services.
Helping to Strengthen the Marketplace
We want to help address these issues, so if you encounter any of them please do give either the organisations you tried to buy from, or iSE the kind of constructive feedback that can make a difference. We can work with organisations on business matters such as customer service, pricing policies and sales strategies, as well as encourage the development of new organisations to fill any market gaps.
Just Buy Campaign
Put Your Money Where It Counts
Shop for Change supports the Just Buy campaign, which is borne out of Social Firms UK’s Social Expenditure Report (2009).
The campaign advises that if we all took the time to choose the type of businesses we buy from – without having to compromise on quality or service – more small businesses would become sustainable; creating more jobs and strengthening communities without sacrificing both vulnerable people and the planet.
For more details, or to pledge your support to Just Buy, email here.
