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A high percentage of the most successful young entrepreneurs are socially minded, but is this coincidence or can social entrepreneurship really boost business sales?
Social entrepreneurship can be defined as the pursuit of innovative solutions to social problems and therefore comprises activities such as microfinance lending and the provision of products and/or services that enable impoverished people to enjoy better standards of living.
The main goal of social entrepreneurs is therefore not profits for themselves but rather the value of creation that aids society, however, social entrepreneurs must be fiscally savvy and this generally involves earning profits for themselves.
Value creation – What exactly does that mean?
When we engage in activities to turn a profit solely for the sake of making money we have a tendency to overlook value creation and the importance of creating value for society.
Value creation can be defined as activities – the creation of products and services – that provide value to consumers, but it can also be defined as activities that provide value solely for shareholders and it can also be defined as activities that create value for society and it’s the latter definition, that of creating value for society, that offers the greatest potential, both for society and for our business interests, because products and services that create value tend to be in higher demand.
When we create value for society we’re creating products and services that improve people’s lives and that’s an important part of social entrepreneurship; however, there’s actually more to social entrepreneurship than creating value for society, as it can also involve sustainable business practices and for-profit social enterprises, both of which can enable business organisations to enjoy greater revenue in addition to being socially responsible.
Sustainable business practices
Sustainable business practices are activities characterised by environmentally-soundness pursued by business entities with the aim of operating in a sustainable manner by, for example, reducing greenhouse gas emissions, utilising green energy alternatives and avoiding activities that impact negatively upon the environment.
There exists opportunities for business organisations to capitalise upon the adoption of sustainable business practices by boasting ‘green credentials’ because consumers are increasingly aware of the importance of adopting sustainable business models and many consumers are consequently favouring businesses that operate in a sustainable manner which, in turn, enables them to enjoy healthier profits.
For-profit social enterprises
Whilst many for-profit social enterprises have adopted sustainable business practices, they’re not characterised by sustainable activities but rather seek to make positive social changes with the profits they make by means of providing for-profit products and/or services to consumers.
A prominent example of a for-profit social enterprise is Tom’s Shoes, for whilst their business purpose is to sell shoes and turn a profit, their equally important social purpose is to provide barefoot children around the world with shoes.
This is not only an excellent example because of Tom’s Shoes’ social purpose, but also because it shows how without incoming revenue an organisation would be able to sustain itself and provide, in this case, barefoot children with footwear.
Additionally, its social purpose can be seen as the basis for its business model and its social purpose helps it to enjoy greater sales.
Social entrepreneurship and you – How will you make the world a better place?
So, how are you going to put into effect plans that will make the world a better place from the comfort of your flexible office space? Will you enter into strategic partnerships with like-minded entrepreneurs and businesses and/or will you create products that provide value and better people’s lives and in the process turn a tidy profit for yourself?
Image cover source: G-Code Magazine
Guest post written by Wendy C. Reid: Wendy is a freelance writer and editor with plenty of experience in writing about business topics. One of his / her clients is Regus in the US, a leading provider of flexible workspaces and virtual solutions.