In my last post (Does your social enterprise model have market viability?), I shared some insights and market research tools to help you determine if there was a market for your proposed social enterprise model.
Assuming the answer was a resounding yes, it is also important that the enterprise be able to differentiate itself within its competitive space, meaning:
It will provide a product or service that has unique qualities, perceived or real, which distinguish it from competing products or services, and that will be valuable to your target market(s).
Unlike for-profit businesses, social enterprises are designed to support a nonprofit mission, therefore they appeal to altruistic buyers. For example, Toms Shoes is a good example of social enterprise done right. Toms competes in a for-profit market by selling quality shoes and using the profits to help people in need. Every purchase provides either shoes or eyewear to the less fortunate.
Note that the operative word here is quality – because whatever product or service a social enterprise of any size provides, it must also differentiate in areas such as quality, value or customer service. These are not easily replicated by competitors and are important to all buyers, altruistic or otherwise.
A social enterprise must hold its own in its competitive market and not rely on its altruistic appeal to achieve success and sustainability.
Stay tuned for our next blog, where we’ll take a closer look at the fourth critical success factor: Resources needed to launch manage and grow a social enterprise
And please post your comments or questions!