European Social franchising expert seminar krympt

 European Social Franchising Expert Seminar 14-­‐15 April 2011, Genoa Italy Expert Seminar Key Findings Social enterprises and social franchisors (SF) are value-based businesses,
which combine the responsive and entrepreneurial abilities of private
enterprise with the social values of the public and charitable sectors.
Franchising for social enterprises is a relatively new concept that needs
support and encouragement. When looking closer, there are many subjects to
address and a lot of issues to handle. We are in the firm belief that social
entrepreneurs can succeed with his/her business idea and with their methods
of developing the people within his/her organization, but we also want to
stress the fact that running a social franchise business successfully needs in
many situations a new approach. The condition for SF is a mix of being in
full competition with their products/services and at the same time replicate,
while not forgetting its social responsibility.
Our pre-study of SF in Europe reported that there are more than 6000 people,
probably more than 10 000 employees in the Social franchise branch today.
The industry is rapidly growing; the majority of SF has established
franchisees during the last three years.
The expert group agreed upon the follow main areas for success;
There are many similarities between social franchising and "ordinary "
franchise. We compete in the same market with many of the same conditions:
A proven and replicable business idea and financial strength for reliable
endurance. In addition, we all agreed that we must keep in mind that we are
focusing on social goals. We must never deviate from our mission. A rooted
and embedded network is an important success factor for long-term stabile
and secure development.
To further develop a strong cohesion within the social franchising will
increase the opportunities for the industry to grow. The meeting showed that
there are common denominators that can be solved in a network. Since one
can assume that we are facing a major expansion of SF in Europe, there are
many reasons to further strengthen and develop specific meeting places.
Welcome and introduction to the meeting Introduction to The Network for the Better Future of the Social Economy and
European Social Franchising Network (ESFN) by Sven Bartilsson and Keith
Richardson.
Sven Bartilsson greeted everyone warmly welcome and looked forward to a
fruitful meeting of experts on Social Franchise. The aim of the meeting is, on
the basis of participants' expertise, to discuss the establishment of a network
of organizations working in the area of Social Franchising in order to
facilitate the development of SF in Europe. The meeting will also bring
together the knowledge from SF and give input to the recommendations in the
BSFE Learning network. SF should also be seen as a tool for governments in
their efforts to offer good jobs and healthy companies for people with special
problems who have difficultes when entering the labor market.
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”There is a growing market of good projects and know-how, it is a question
of financing and bringing it out on the market. Finding the method and the
model to spread and replicate. We see a need of guidelines in order to help
the branch.”(Nina Leseberg from Bundesverband Deutscher Stiftungen)
Presentation of the European Directory of Social Franchisors, key findings of the research. On behalf of BSFE we have performed an extensive survey of SF, on what
theirs needs are and which challenges they are facing. Keith Richardson
reported: The survey is designed to identify networks and social
enterprises/SF that exists today in Europe. The aim has been to obtain a basis
for the status in the industry. In which industries are SF established? Needs
and priorities, are there similarities between SF companies in how to address
the problems?
The aim is also to measure the impact SF does on the European market. We
must remember that the investigation so far is based on the number of SF in
various ways known to us. There are probably still a large number of SF in
Europe that could be included in the database. In order to make the
information more reliable, it is important that we constantly look for more SF
to form a clear picture of the industry.
Social Franchisors in Europe: • UK
National Community Wood Recycling Project, MyBnk, Bikeworks,
Riverford Organics, Ex-cell solutions, Ethical Property, Princess Royal
Trust for Carers, Participle, Big Issue, Foster Care Cooperative, My Time
CIC, Bio Regional, The Big Lemon, Household Energy Services, School
for Social Entrepreneurs, Brighter Futures, Green Works, Fruit to Suit,
Health Exchange, Future Clean, Friends of Farmers Markets, CASA, Green
Gym, Law for All, Pack-It, Big Green Valley, Aquamacs, H2oPE
• Italy
Consorzio Pan, Atlantide, Comunita Solidali, Le Mat
• Sweden
Friskis & Svettis, Villa Vägen Ut, Le Mat
• Germany
Cap Markt, Dialogue in the Dark, Balu und du
Notinsel, Miniphaenomenta, Lifeguide
• Denmark
Specialisterne
• France
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AETES Environnment, Energies Alternatives, Optimomes
• Belgium
Komosie, Groep INTRO, Fietsenwerk
• N’lands
Fietspunt
• Poland
Barka, Flandria
• Portugal
Empowerment Gateway
What do SF do? Which industries do they work in?
Recycling
Social Work
Leisure / Tourism
Energy
Food &
Horticulture
Social Care
Transport
Education
Child Care
Health Care
Offender
Management
17%
13%
13%
13%
13%
8,5%
8,5%
8,5%
4%
4%
4%
Facts and Figures
• 6,000 plus employees
• Average 55% disadvantaged in the organisations
• Total turnover €184 million
• 90% of the companies provide services
• 275 social franchisees
• 60% companies established in 2005 or later
• 65% first developed first social franchise after 2007
• 70% developed social franchise without external advice/support
• 80% received external funding
• 60% development funded by ESF
• 60% charge a a start up fee
• €15,000 euro average fee
• Largest fee €50,000
• Average cost of start up is €160,000
• Range €3,000 to €750,000
• 90% make on going charge
• Most common % of turnover 1-10%
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What kind of external help do the franchisors need?
Workshop on success factors of social franchisors.
A workshop was conducted in order to tap the expert knowledge of success
criteria for the establishment and development of social franchising. The
workshop was performed according to the Opera model where small groups
litigate the essential concepts to the next step, discuss them and find solutions
to possible problems. Below are the group’s keywords and results of
discussions on key concepts.
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The success factors of social franchising: Proven and
replicate
social
business
A well
developed
Business idea
Sustainability
Market
needs
combined
with a
business
plan
Tested/proven Slow to
concept that
grow
works in
approach
other regions to a
as well
sustainable
model
Be able to
provide a
“business in a
box”
Rooted
Strong
network of
franchisees
and local
partners
Resources
Enough
resources
(finances,
people)
Local
Sustainable
network;
finance
Social and
model
Economic
organization
Support
structure to
handle
complicated
puzzle
To find the
right
franchisees
Mission
Mutuality
Always
retaining the
integrity
(no mission
drift)
Low competition
between members, F
has his own working
areas
A convincing
narrative that
links values
and
objectives to
means
Social
entrepreneurs,
not social
workers – a
belief in the
market
Franchisor/franchisee
Mutual benefit,
strong support chain.
Good understanding
between the
franchisees
2.
The expert group agreed upon continue to exam the following main areas for
success;
”Rooted, embedded network” •
•
•
•
•
Determining shareholders, clear roles, dialogue between franchisor and
franchisee has to be developed in an early stage.
Community involvement is important, use existing network and establish new
networks.
Franchisor has to help open doors for franchisee.
Network between franchisees to transfer knowledge and experiences.
Important that the same values and messages/stories carrying the values is
consistent in the network on every level.
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”Proven replicable business idea” The picture shows the aspects of a proven business that the franchisors must
have developed and the tools and process that is developed in the replication
process. The franchisor has to develop services and to determinate the role of
the social values and how the social aims should be fulfilled. Normally are
the social goals not the key factor for success in the marketplace.
”Resources” •
•
•
•
Sustainable finance model(s) must be developed by each social franchisor.
Models for social franchisors growth must be developed and spread. These
could be combinations of traditional finance tools, public fundings and
alternative financing tools. We don’t know in which ways loans? Equity?
boot-strapping? Grants? are used.
Strategy for European SF network or National SF network: has to be
developed for improving finance opportunities
Raising awareness among Finance institutions, banks, and foundations about
the opportunities of SF.
”Mission – keep in mind that we are focusing on social goals” •
•
•
Keeping true to your missions is a matter of continual difficult judgement,
especially in hard times. Insist on your own bottom line/minimum package.
Set the terms of trade (social clauses etc.)
Search for entrepreneurship, not community development – don´t set up
people to fail. The franchisor has a responsibility.
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•
•
•
Do R&D!
Link to social innovation
Mutuality (understanding in competition)
Discussion Social franchising allows social enterprises to retain their local roots and be
effectively governed locally without loosing the benefits of scale and political
influence that larger organisations often have.
Social franchising makes it much easier for social entrepreneurs to be
individuals or existing social enterprises wishing to grow in new markets.
They provide a credible and proven business model, practical support from
people who have run the business and access to training and a range of other
expertises and resources.
The expert group addressed the problem that the nature of SF is in many
cases to grow slowly, meaning in a stabile and organized way. But the
pressure from banks and risk capitalists and sometimes the market, forces us
to grow quick and then we risk to sell know-how, which is not proven. The
pressure and demands can also come from the franchisee. It is important to
have an approach that promotes the SF group to develop together in order to
avoid that the franchisees take there know how and leave the franchisor. That
situation can be avoided by an “umbrella organisation”, where common
issues to create an open climate and where the franchisor can have an open
discussion with the franchisee.
The key roles for European Social franchise network.
The participants agreed on the importance of having a common organization
to develop and protect SF interests. A federation of the social franchisors in a
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common organisation can potentially allow SF to compete with large public
and private sector providers, which otherwise might be impossible.
Establishing a sector organization to share common problems, solutions and
exchange knowledge is interesting for the social franchisors. The expert
group agreed upon that it is also important to have a network when people
look for inspiration and knowledge on how to expand their business, financial
issues, sharing information, training for franchisees,
benchmarking/mentoring, shared learning etc.
It is important to feel that you
are a part of something bigger
than just your own company.
Maybe someone else in the
network has the answer to your
questions!
The last issue discussed at the meeting
was the question of the future work; is
there a need for cooperation, a network
or organization of social franchises in
Europe? What need is there among the
franchisors?
The group agreed that there is a
need for networking in order to
strengthen our positions. But
networking also expands the
possibilities of using common
knowledge and exchange
experiences. Many expressed
the need for benchmarking; an organization can protect interests and pay an
impact on governments (if needed) "together we are big and strong, " together
we can attract R & D money! Other areas where cooperation plays a vital
role; search for new agents, matchmaking of SF within the countryside as
well as in other countries in Europe
Future work and next steps
Social franchising is at an early stage of development and this meeting has
addressed a number of issues that have not yet been resolved, but need to be
considered when setting up a social franchise organization. This further
emphasizes the importance of a network in which each organization can draw
strength and knowledge of how others have solved problems and addressed
situations.
To further develop a strong cohesion within the social franchising sector will
increase the opportunities for the industry to grow. The meeting showed that
there are common denominators that can be solved in a network. Since one
can assume that we are facing a major expansion of social franchisors in
Europe, there are many reasons to further strengthen and develop specific
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meeting places for SF firms.
There is a proposal to organize a meeting in London this fall. The purpose is
to invite all SF firms that participate in the completed survey. This is to
provide a venue for exchanging experiences and supporting the development
of entrepreneurs. The meeting recommended investigating the possibility of
inviting players that could be interesting for the industry, lawyers, banks and
franchisors in other industries, researchers in the topic.
The work has to take in consideration the processes and actual initiatives
within the EC. The Social Business Initiative in DG Market is an example of
where the work of BSFN can contribute with input.
www.socialfranchising.coop
Short demonstration of the ESFN website under construction at
www.socialfranchising.coop
The delegates had a short discussion on layout etc. The changes will be
implemented as soon as possible.
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Appendix
List of participants at the meeting in Genua.
Participants
Organization
Pernilla Svebo Lindgren
pernilla@vagenut.coop
Vägen ut kooperativen and Le
Mat Sweden
Keith Richardsson
keith@core.coop
CORE, UK
Mike Berriman
Michael@commonwheels.org.uk
Economic Partnership and
Common Wheel
Sven Bartilsson
sven.bartilsson@coompanion.se
Coompanion & Le Mat,
Sweden
Renate Goergen
renate@lemat.it
Le Mat, Italy
Werner Block
werner.block@gdw-sued.de
GDW SÜD (CAP), Germany
Nina Leseberg
Nina.leseberg@stiftungen.org
Bundesverband Deutscher
Stiftungen, Germany
Barbara Sadowska
sadowscy@barka.org.pl
Barka Foundation, Poland
Jürgen Blondeel
Jurgen.blondeel@komosie.be
Komosie, Belgium
Jos Vandikkelen
Jos.vandikkelen@velo.be
Fietsenwerk, Belgium
Giovanna Maranzana
Giovanna.maranzana@villaperla
service.it
Cooperativa sociale Villa Perla
Service Italy
Toby Johnson
Toby.johnson@poptel.org
Aeidl
Christina Byström
Christina.bystrom@coompanion.
se
Coompanion, Sweden
(documentation)
Linda Rutter
Linda.r@ses.coop
Sustainable Enterprise
Strategies, SES, UK
Lynn Summerside
Lynn.summerside@sitnbfit.co.uk
Sit N B Fit CIC, UK
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