How making profit can help your community

Relying on grant funding is becoming increasingly hard for community groups as competition for funding grows against a backdrop of funding cuts.  Some groups are meeting this funding challenge head on and starting a social enterprise.

What is a social enterprise?

A social enterprise is an organisation that has a clear social and/or environmental mission which generates the majority of its income by selling goods or services rather than through grants or donations. Running as a business, a social enterprise aims to make a profit but instead of giving profits to individuals or shareholders they are invested back into the organisation to fund activities or projects that benefit people and their communities.

Why is it important for social enterprises to make a profit?

It might not be immediately obvious that social enterprises need to make a profit, but without this element they are unable to sustain themselves and remain competitive in the business sector.

Can the National Lottery Community Fund, fund a social enterprise? 

While we love giving out grants, we do don’t have enough money for every application for funding. We therefore look to see whether an organisation has a range of income streams as this can help its sustainability and prevent it becoming reliant on our grant funding.

We can and have funded a range of social enterprises in Wales:

Xcel Bowl in Carmarthen operate a state of the art bowling alley whose profits are then put into running a number of projects within their community including a low-cost furniture and white-goods shop that gives people in the area with low-incomes the opportunity to buy affordable items. You can read more about them on their website by clicking here!

The Rabbit Hole Café in Llandudno’s unusual Alice in Wonderland-themed environment makes it a unique place for people in the area to have lunch, and it also has rents out meeting and office rooms as a separate source of income. With its profits, the company offers volunteering and training opportunities to support people facing mental health and wellbeing difficulties, whilst also supporting them into employment. You can read more about them on our blog here!

Nuhi in Cardiff design and deliver bespoke training workshops around a range of topics including substance misuse, digital inclusion and employability skills. The profits from this part of the business go into supporting their volunteers with development opportunities as well as supporting clients that have complex needs.

Where can I find out more about social enterprises?

There are lots of places that can help you find out more about social enterprises. The Wales Cooperative Centre can support you to develop your social enterprise, Business Wales are also a great resource as they have loads of case studies on their website. You can also find broader information on Go Full Circle.

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