Transforming Business with Community-Based Models
As a business owner or entrepreneur, your choice of business model should align with your organization's core values, mission, and vision. One increasingly popular option is the community-based business model, often referred to as a Social Enterprise. This approach is gaining attention as society grows more interested in connection, collaboration, support, and advocacy. Social entrepreneurs who adopt this model not only focus on profitability but also on making a positive impact on people and the planet.
The events of 2020 and 2021 marked a significant shift in business practices, driven by collective activism and a heightened demand for social and environmental change. Consumers are now holding businesses accountable for their role in promoting collective well-being, reflecting a desire for organizations to integrate people and the planet into their practices. Community-based business models are a powerful way to embrace this responsibility and effect meaningful change.
My Experience with Community-Based Models
My personal journey with community-based business models has been transformative. Social enterprises that prioritize community foster a unique atmosphere that goes beyond mere profit. These businesses radiate a sense of belonging and demonstrate a commitment to values beyond financial gain. This approach allows consumers to feel valued, respected, and involved, creating a culture of coexistence.
In this article, we'll explore how community-based models can transform businesses into more sustainable, equitable, and vibrant entities centered on the well-being of both people and the planet.
What Sets Community-Based Businesses Apart?
The primary distinction between traditional businesses and community-based enterprises lies in their end goals. Traditional business models often prioritize profit above all else, leading many advocacy-driven business owners to feel misaligned with their goals. Community-based models, on the other hand, are designed to make a genuine difference, emphasizing the interconnectedness of all things and striving to improve social and environmental conditions.
Community-based businesses are ambassadors for social, economic, and environmental change, structuring their operations to support these causes. They are not just about projecting social responsibility but actively practicing it. This shift away from traditional profit-driven models allows for a more meaningful engagement with community and environmental issues.
Understanding Community-Based Business Models
Community-based business models are characterized by their co-led and co-operated nature. They often promote a co-ownership culture, sharing power, leadership, and benefits among community members. Social enterprises, linked to Freer Spreckley’s concept from 1978, vary widely in their implementation. Some are entirely volunteer-run, while others generate profits to support paid roles and community initiatives.
Here are the three general social enterprise models:
Opportunity Employment: Organizations that provide jobs to individuals facing significant barriers to mainstream employment. Example: Goodwill
Transformative Products or Services: Organizations creating social or environmental impact through innovative products and services. Example: Soles4Souls
Donate Back: Organizations that contribute a portion of their profits to nonprofits addressing basic unmet needs. Example: The Thx Co
What Does a Community-Based Business Look Like?
Community-based businesses focus on co-creation and collaboration. They are socially and environmentally responsible, emphasizing reinvestment in the community to strengthen it. These businesses are people-centered, valuing collaboration, partnership, and advocacy. They often function as Social Enterprises, although they can vary widely in structure.
Key Characteristics of Community-Based Businesses:
Structured around contributions to the community.
Focused on achieving social and environmental objectives.
Driven by a desire to improve life quality for people and the planet.
Success is measured by positive impact rather than profit.
Profits are reinvested into the community.
Traditional Business Models vs. Community-Based Models
Traditional businesses typically prioritize profit and growth, often sacrificing social or environmental considerations. While some traditional businesses engage in Corporate Social Responsibility (CSR), this is usually secondary to profit. Community-based businesses, however, prioritize impact over profit, aiming for long-term, meaningful change.
Community-Based Business Efforts:
Physical community events
Affiliation programs
Co-ops
Online communities
Membership or subscription programs
Rewards programs
Volunteer programs
Nonprofits or mutual aids
Community outreach projects
Transitioning to a community-based business model requires intention, patience, and collaboration. Unlike traditional models focused on quick results, community-based approaches emphasize thoughtful, collective efforts. Key aspects to consider include:
Volunteering
Assisting roles
Research and development groups
Shared missions and visions
Feasibility studies
Experimentation
Sharing the workload
Reciprocal exchanges
Community care
The Benefits of a Community-Based Business Model
Implementing a community-based model offers numerous benefits, including:
Enhanced sense of belonging and connection for all involved.
Stronger brand loyalty and trust.
A more humanized business perspective.
Increased community engagement and value.
However, this model requires a commitment to being both a leader and a participant. It involves developing emotional and cultural intelligence and investing in skills necessary for creating equitable and inclusive environments. Community-based businesses understand that impactful change takes time and practice patience while trusting the process.
In conclusion, community-based business models offer a powerful alternative to traditional approaches, aligning business practices with the goal of making a positive impact on people and the planet. By embracing this model, businesses can create a more inclusive, responsible, and vibrant future.
Until next time…
Natalie Brite - DoGoodBiz Studio
