Social Enterprises Survey 2010

By Teo Mee Hong, Executive Director of SE Association. Prior to joining the Association, Mee Hong spent ten years in Bizlink to create ‘These Abled People’ which generated jobs and income for the disabled. She later joined NTUC ARU and launch e2i and $23.2mill NTUC U Care Fund to support union members.

A social enterprise is a business with a social objective. It harnesses the forces of the marketplace, applying business practices to achieve its social mission. It operates on a level playing field with commercial businesses and unlike the latter, a social enterprise has double bottom-lines – financial sustainability and social impact. In some instances, it has a third bottom-line to include environmental impact. Prime Minister Lee Hsien Loong spoke about Joan Bowen Cafe which is an example of a social enterprise during the National Day Rally Speech in 2011. He used the cafe to epitomise active citizenry in Singapore, where people did not just rely on the Government to solve problems but took initiative to do something about them. President Tony Tan met social entrepreneurs during his presidential election campaign and mentioned Dignity Kitchen – School of Hawker Training (Disabled and Disadvantaged) and Professor Brawn Cafe as impactful ideas that showed how disabled people could be helped to help themselves.

A survey commissioned by the Ministry of Community Development, Youth and Sports and conducted by Lien Centre for Social Innovation in 2007 estimated that there were 150 social enterprises in Singapore. The sector is a nascent one, even though it has notable players like World Toilet Organisation, O School and aidha (Schwab Foundation Social Entrepreneur of the Year 2001, 2007, 2008 respectively).

Tasked with a national mandate to promote social entrepreneurship in Singapore, Social Enterprise Association (also known as SE Association) has positioned itself as the umbrella organisation where social entrepreneurs go to for networking, training and funding support. Its social enterprise members enjoy free business clinics the way Small and Medium Enterprises (SMEs) are supported by SPRING’s five Enterprise Development Centers (EDCs) established in collaboration with business chambers and associations.

For benchmarking purposes, SE Association commissioned a face-to-face survey on social enterprises with 2000 households in Singapore to establish a baseline of public awareness of social enterprises. The survey sought to find out whether the public is aware of social enterprises, what their buying behaviors are and what motivates them to support social enterprises.

The respondents were segmented into three groups according to their reported purchasing behaviour with regard to social enterprises – “buyers”, “ready buyers” and “non-buyers”. Respondents who had not bought from social enterprises but were willing to buy from social enterprises in the next six months were “ready buyers“ while those who would not consider buy do so, were “non buyers“.

Unveiling the Facts

Only 13% of public had heard of social enterprises and only 2% were able to name social enterprises correctly. Top five recalls in ranked order were: Yellow Ribbon Project, Singapore Corporation of Rehabilitative Enterprise (SCORE), Breakthrough Café, Eighteen Chefs and MINDS Thrift Shop. Amongst the organisations which were wrongly named as social enterprises were National Kidney Foundation and SPRING Singapore. Products and services bought from the sector include greeting cards, gifts, paintings, catering and removal services. 91% of the customers were satisfied with their purchases.

The most preferred source or channel of purchase among the buyers, ready buyers and non-buyers was ‘retail outlets’. The second most preferred source would be the Internet. Notably, the most commonly used buying channel among the buyers currently was direct sales (83%).

Most of the respondents preferred to receive their information on social enterprises through broadcast media, followed by print media and the Internet. Among those who had heard of social enterprises, most had learnt about social enterprises through broadcast media and print media.

Need to Clarify What is Social Enterprise

There is a need to tell the public what social enterprises are and how they contribute to the society as 62% of the respondents who were not willing to support social enterprises were not sure what social enterprises were. 46% were not sure how social enterprises help society.

While most respondents acknowledged that the main objectives of social enterprises were to hire needy disadvantage and address social and/or environmental issues, about half wrongly thought that it was to “raise donations” and one third believed it was to “encourage staff to do community work”. 20% had the wrong perception that it was to “create publicity for commercial companies”. Only 18% believed that social enterprises should make profit, when social enterprises are expected to make profit and generate revenue to support their social bottom line.

Social Causes Sell

The buying factors for regular businesses and social enterprises were the same. They were “quality”, “price” and “need for the products or services”. For buyers of social enterprises, social cause ranked the first. Social cause sells even though most social enterprises do not want to sell solely based on their social cause.

Beyond supporting the “social causes” of social enterprises, a high 70% wants to “contribute back to society”, a practice widely known as corporate social responsibility or CSR initiative. A good 38% of the respondents “prefer it to giving donations to support social causes”. Buying from social enterprises is another way the public engages charity.

Potential Market for Social Enterprise is Huge

A whopping 55% of respondents who had not purchased from social enterprises were willing to buy from social enterprises within the next six months!

From the survey, it was found that more than 50% respondents would pay competitive market price for the products. Over 70% of the respondents were willing to pay the same or higher price for products or services that were sold by the social enterprises.

Going Forward

SE Association will work closely with the various key stakeholders to clarify the definition of social enterprise and create greater awareness for the sector. SE Association will market the members‘ directory on its website. It features its 160 social enterprise members and their products and services, allowing corporations and public to locate them.

It will use its Social Enterprise Development Centre to provide business consultation and training to each individual member to empower each member social enterprise to create greater publicity and sales.