3xE_Winning Business Final

8/2/2019 3xE_Winning Business Final

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Winning BusinessAn introductory guide

CrisisEthical Enterpriseand Employment(3xE) Network


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2 Winning Business

Contents

1. Why grow a trading business? 4

2. Things to think about when getting ready to do business. 4

3. The need for market research. 5

4. Working with other organisations/developing partnerships. 6

5. Winning business. 7

6. Summary. 10


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Winning Business 3

3xE Network: a social

enterprise networkfor the homelessnesssectorThe Ethical Enterprise and Employment

(3xE) Network is run by Crisis to bring

together organisations using social

enterprise and supported employment

models, and organisations working with

unemployed people who are homeless or

at risk. 3xE works in partnership with socialenterprise inrastructure organisations

throughout England to improve take up o

their services by homeless sector social

enterprises. 3xE also unds a variety o

support services specially tailored to the

needs o the homelessness sector to enable

organisations to start and develop social

enterprises or supported employment

schemes. The network is unded by the Big

Lottery Basis programme.

Info sheetThis is the ourth in a series o ino sheets

that 3xE is producing to capture and

disseminate the learning rom the Network. It

is based on a conerence that the 3xE project

held on November 30th 2011 (Winning

Business), which explored the ways in which

organisations in the homeless sector can

begin to develop and generate commercial

trading services and incomes.

It details the key themes and issues

raised over the day by both speakers andparticipants and oers details o where urther

inormation about them might be accessed1.

It is intended as a primer rather than

serve as a blueprint or how to develop a

social enterprise and then subsequently win

business, it oers the rationale or doing so

and the key stages to consider when planning

your strategies.

Many groups who use this ino sheet may

already be pursuing aspects o developmentwhich are introduced here. The ino sheet is

thereore structured into separate sections,

the ordering o which refect a typical

journey in developing and launching a new

social enterprise venture.

This inosheet draws upon national

research, training materials and personal

experiences o Adrian Ashton a nationally

acclaimed provider o advice, training

and consultancy services in relationto Governance issues and enterprise

development.(www.adrianashton.co.uk)

1 please note any web links were correct at time o publication o this ino sheet some websites may change over time


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4 Winning Business

1. Why grow a tradingbusiness?It is important to be clear as to the reasons

why an organisation is interested developing

a social enterprise as a trading business,

as it will help ensure that the right business

models are adopted. Some o the most

commonly cited reasons or homelessness

and housing sector organisations to set up

such are venture are:

there is increasing competition or undingrom traditional sources such as grant

making trusts and public bodies,

generating income rom traded services

presents a clear opportunity to not only

protect services, but also potentially

increase them by being able to subsidise

them through prot rom trading,

traded income also helps to balance the

nancial risk o being over-reliant upon a

single, or very small number o, existing

income sources.

2. Things to think aboutwhen getting ready todo businessIt is important or social enterprises to have

strong business oundations beore competing

or business and trading in the open market.

In any new venture there may be barriers that

could impede development and likely success.

Being clear about what these might be, and

how they can be best addressed is crucial.

While there are many other books and

materials already published on such barriers2,

the main ones that were identied through the

Winning Business event were:

Finance:

Developing new services and products

will incur costs (e.g. stang, materials,

premises, etc), a long time beore sales

revenues are generated and received.

These will need to be careully actoredinto the business plan and start-up nance

may need secured. Introductory guides

to the dierent sources o development

nance can be ound at http://www.sel.org.

uk/unding-and-nance/ and http://www.

slideshare.net/adrianashton/nancing-

socent-mmu-guest-lecture-nov-2011

Getting the Right Skills and Support:

Your organisation will need good

management support. For some socialenterprises not all o those leading the

business are recruited as entrepreneurs

or marketing managers. Look around you

to see who can help or example, it may

be that some providers o nance can also

oer you nancial guidance as part o their

investment in you.

2 http://www.unece.org/leadmin/DAM/ceci/ppt_presentations/2007/eed/tur.pdhttp://sheeld.academia.edu/ColinWilliams/Papers/648817/Tackling_the_barriers_to_entrepreneurship_in_a_deprived_neighbourhoodhttp://www.cda.org.uk/2011/09/14/access-to-nance-is-largest-barrier-to-sustainability-o-uk-social-enterprises/


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Understanding the market:

Organisations dont always thoroughly

understand who their customers will be.

Without adequate market research it is

impossible to properly price or promote

the service in a way that will attract their

interest and custom.

3. The need for market

researchHowever well you are able to gain the

resources, investment and skills needed to

develop and launch your new enterprise,

ultimately you need to be assured that it is

easible there is a demand or it and people

are willing to pay you a price that allows you

to sustainably oer it.

In order to best present your service to

targeted customers it is vital to make surethat you understand them nd out what

their priorities and concerns are, how and

when they procure services, and what they

might be willing to pay. It is important to do

this beore you enter into the market place

and compete or business.

There are already various published guides3

(including a 3xE ino sheet Marketing Matters)

on how to undertake market research and

develop a marketing plan. Whichever onesyou use, the key task will be to identiy what

it is that makes you stand out. What can

you oer, either through the way in which you

deliver your service, or the impact it creates or

your customer that they currently cant benet

rom by using any other enterprise. Knowing

this will make it ar easier to attract their

attention, and also their business.

3 http://managementhelp.org/marketing/market-research.htm

2 http://www.businesslink.gov.uk/bdotg/action/layer?topicId=1073901910


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6 Winning Business

4. Working with

other organisations/developingpartnershipsFor some smaller social enterprises or

those that are looking enter into larger

contracts working in partnership with other

organisations can increase the contracting

opportunities. Partnerships can be used to

pursue various aims and take dierent orms

rom occasional and inormal joint purchasingagreements to access savings on bulk/shared

purchasing, to legally ormalised consortia or

delivering contracted services.

An example o consortia delivering services

is the WISE Group4; they identiy contract

opportunities and delivery partners, and

oer partnerships which include access to

management unctions and inrastructure.

This gives credibility to the partners so they

can bid or contracts they would otherwisebe excluded rom. In return the WISE Group

gains the opportunity to access new services

that it can oer elsewhere.

A social enterprise might identiy a contract

opportunity that ts with its services and

social mission, but which it is too small

to bid or, or not be able to satisy the

requirements o the commissioning ocer

(such as having 3 years o audited accounts

or adhering to certain quality managementstandards). In such instances, collaborating

with another enterprise that can deliver the

balance o services and to collectively meet

those requirements is highly benecial.

Thus improving the capacity or all involved

to enter the supply chain o contracts that

they would otherwise not be able to bid

or independently. This also helps them to

develop a trading history which is can then

build on to grow and strengthen itsel to bid

or later contracts in its own right.

There are many other benets to working

collaboratively with other organisations, in

partnerships or consortium; these can vary

depending on the size o the organisation and

the aims o the collaboration. However, some

o the benets can be:

Oers immediate access to a wider

variety o skills, expertise and resources,with each member working towards their

strengths

There is a potential or wider social aims

and impact to be met

Savings in time and money (especially with

bulk purchasing)

Allows organisations to shortcut the

time and costs involved in developing the

inrastructure needed to when bidding or

and delivering contracts

Minimises the risk Increases the possibility to bid or larger

and more sustainable contracts

Improves the prospect o investment

opportunities

When exploring the development o any such

partnership, it is important to recognise that

it will take time and eort, not all parties will

want the same things rom the relationship,

and not all may care that youre a social

enterprise or about your social mission.

There are various resources available to

support organisations begin to explore and

start the process o developing partnerships:

http://www.partner-up.org/resources/

http://oundationcentre.org/gainknowledge/

collaboration

http://www.charity-commission.gov.uk/

4 http://www.thewisegroup.co.uk/content/


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Winning Business 7

publications/rs2.aspx?

http://www.charity-commission.gov.uk/

library/guidance/cc34text.pd

http://www.ncvo-vol.org.uk/advice-support/

collaborative-working

Whichever type o partnership is being

explored, there are common stages that need

to be worked through to ensure the best use

o the time and other resources that may be

available to you in pursuing them

a) agree the purpose or the partnership what everyone wants to achieve rom it

and what they agree is their shared or

common purpose in coming together

b) agree how the partnership will operate

how decisions will be taken, who will be

responsible or what actions and areas,

who else needs to be involved, and how

its perormance will be monitored

c) ensure that other stakeholders and

interested or aected parties have the

opportunity to be involvedd) encourage all partners to commit the

resources they have agreed to, and that the

partnership will need to make it a success

e) review the achievements and progress o

the partnership at regular intervals

5. Winning businessFinally, now that an enterprise has been ormed

and its management is in place, it can begin the

business o winning contracts and work.

Finding the Opportunities

Ultimately, all strategies that are employed to

win business rely on being able to nd it! This

can be done in a variety o ways including

monitoring various registers (examples o

which are listed in the appendices to this ino

sheet), networking and knocking on doors.I potential customers dont know that youre

interested in them they wont contact you

with invitations to deliver services. Developing

a range o personal contacts can help you to

remain on top o changes in the marketplace.

There are various websites that list and

prole arising contract opportunities. Those

listed below oer a ree, either national or

European, directory. However, there are

others that will also search or contractopportunities on your behal on a paid

subscription basis.

Many local authorities also have their own

dedicated procurement system to advertise and

accept proposals to deliver contracted services

so you should make contact with your relevant

authority. Contacting your local Chamber o

Commerce may also help in identiying contract

opportunities with private companies.

http://contractsnder.co.uk/

http://www.undingcentral.org.uk/Deault.aspx

http://www.ojec.com/Deault.aspx

http://ted.europa.eu/TED/main/HomePage.do


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Elevator Pitch

As well as selling your service or product,

you will also need to sell your organisation.

You should consider crating an elevator

pitch, essentially being able to tell the story

o your organisation and why people should

be interested in doing business with it in the

space o less than 2 minutes5. Practicing such

a pitch is vital as you wont have a second

opportunity to make the rst impression with

a potential customer.

Procurement & Contractual Requirements

You should also be able to satisy the

contractual requirements o your customers.

For example, public contracts usually require

reerences, o a number and type, which

most start-up enterprises will be unable to

meet. So consider careully i it may be more

appropriate to target private customers who

wont require such stringent conditions.

Another option is to become a sub-contractor

to a larger company that can ull the

contractual obligations. You can identiy thecompanies to approach by nding out who

delivers the Level 1 (top-level) contract to

your chosen rm.

When targeting customers, it can also be

useul to identiy how ormal their tendering

processes are, so you are prepared or the

time required to prepare proposals to deliver

services or them. Under EU regulations any

public contracts or works (physical buildings,

etc) valued at more that roughly 4million,and or other services valued at more than

roughly 150,000, must be openly advertised6.

Below these amounts, commissioning

authorities will be allowed to use their own

procurement rules. However, such local rules

can vary widely between areas and bodies,

so you should be aware that procurement

procedures or one public body or a certain

contract value will not automatically be the

same elsewhere or contracts o the same

amount. Further background inormation on

public sector contracting or social enterprises

and community and voluntary bodies can be

accessed on-line at http://www.navca.org.uk/

localvs/lcp-1

Capacity

Being able to recognise how well you can

meet customers requirements means you

need to be realistic about your own capacity

not just in terms o being able to satisy the

requirements set by the contracting body, butalso in assuring yoursel that you can aord to

complete the work up ront. Delivering services

under contract will invariably mean that you

wont be paid until sometime ater you have

delivered the work.

It is important to bear in mind that they may

also have concerns about using a new start

enterprise as a supplier, so you will need

to demonstrate your capacity, quality and

abilities. It may be that initially you are onlyable to oer a relatively small level o service

or quantities o your product. However, even

small contracts with any type o organisation

oer you a oot in the door. From this initial

contract you will gain contacts, be able to

develop and build on relationships and grow

your services in the uture.

Pricing Strategy

Consider your pricing strategy - this orms

an important part o your marketing plan (see3xE ino sheet Marketing Matters). The price

you charge should ensure that you can aord

to deliver your service and also generate a

surplus to reinvest. While there are resources7

that can support you to identiy what such a

price might be remember that you should also

be able to show how your price is realistic. You

should research your competitors prices and

be realistic about where you sit in the market.

5 http://www.readwriteweb.com/start/2010/04/the-art-o-the-elevator-pitch-10-great-tips.php

6 see http://www.out-law.com/page-5964 and http://competition.practicallaw.com/7-422-4818

7 www.bized.co.uk/sites/bized/les/docs/pricingstrat.ppt


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Winning Business 9

I your prices are higher than the average (due to

the additional costs related to running a social

enterprise) than it may be more dicult to secure

the deal. However, you may be able to overcome

this by targeting your business at companies that

are more socially conscious and consider your

social value within their bidding process.

For example, tcuk8 are identiying the nancial

benets to the wider economy that they

are generating through their employment

o ex-homeless clients (creating savings to

state benets and associated health costs ithey had remained otherwise unemployed,

generation o income tax, etc) to put them in

a avourable position when contracting.

Social Value

This illustrates the wider concept o social

value being able to show how you are

benetting both the local community and

wider society. Such value might include

employing local people (making savings to

the state in terms o unemployment costs), acommitment to using local suppliers yoursel

(and so strengthening the local economy),

health benets that your sta enjoy in terms

o education and support (reducing the need

or longer-term health costs) and so on.

An approach to identiying such value that

is requently cited in relation to winning

contracts rom public bodies is Social

Return on Investment (SROI). The SROI

methodology not only identies the impactsto the stakeholders o your services but also

places a monetary value on them. In doing

so, it is able to calculate a ratio o benet

created to cost or example, or every 1

an authority has spent on commissioning a

service, 3 o benet may have been created

in the wider community through peoples

health improving, savings accrued to state

benets rom people entering employment,

and savings to the justice system rom people

reducing rates o oending. Further guidance

and examples o SROI can be accessed

through the SROI Network at http://www.

thesroinetwork.org/

The concept o social value is not

consistently useul in respect o winning

contracts, as some bodies stipulate that

contracts are awarded only on the basis o

cost at the point o delivery. However, there

seems to be a growing interest in the wider

social benets associated with contracts.

Under the Public Services (Social Value) Act2012 all public bodies in England and Wales

are required to consider the economic, social

and environmental benets when procuring

public services9. Although this does not apply

to public work contracts or public supply

(goods) contracts, there is a growing approval

or public bodies to consider social value when

procuring all contracts, across the board.

Ultimately the need to be able to evidence

and articulate the social value you arecreating will be based on the interests o

your target customers an echo o the

arguments about the need or market

research and understanding what is important

to your customers. Introductory guides

researching and reporting on such impacts

and value can be accessed at http://www.

socialimpactscotland.org.uk/third-sector/

methods-and-tools-.aspx and http://www.

proveandimprove.org/

Keep trying!

Finally, i you dont win the contracts or

work that you are pursuing, always ask or

eedback. It may be that there is something

about your service which is not appealing

i so its important to address this so that

it doesnt prevent you rom winning work in

the uture.

8 www.tcuk.org/ps

9 http://www.socialenterprise.org.uk/uploads/les/2012/03/public_services_act_2012_a_brie_guide_web_version_nal.pd


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6. SummaryIn summary and conclusion, any organisation

considering developing trading enterprises

needs to be honest with itsel about its

capacity, culture and ability to do so.

Generating income through social enterprise

wont be relevant or suit every organisation.

However it should at least be explored i or

no other reason than to assure itsel that

continuing as it currently is really is the most

appropriate strategy or it to pursue.

This ino sheet serves to oer an overview

o the main processes and stages involved

in not only developing a commercial service,

but also in taking it to market and winning

business. The various links and reerences are

oered at starting points to a range o other

existing resources and support that already

exists.

It is not a set blueprint as no two

organistions are exactly the same, or acethe same issues. However, it presents the

principal questions to ask, explains the

rationale as to why these are important and

oers support in addressing them.

The ollowing links to additional resources on

developing a social enterprise may also be

useul:

http://www.socialrms.co.uk/get-involved/

start-social-rm

http://www.ncvo-vol.org.uk/advice-support/

unding-nance/income-sources/open-market

This ino sheet draws upon the already stated

3xE conerence, national and other research,training materials and personal experiences

o Adrian Ashton a nationally acclaimed

provider o advice, training and consultancy

services in relation to the development

and management o social enterprises and

business development

www.adrianashton.co.uk


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Winning Business 11

Appendices:Sources of details of where to nd

contract opportunities:

There are various websites that list and prole

arising contract opportunities. Those listed

below oer a ree either national or European

directory, but there are others that will also

search or contract opportunities on your

behal on a paid subscription basis.

Many local authorities also have their own

dedicated procurement system to advertise

and accept proposals to deliver contractedservices so you should make contact with

your relevant authority. Contacting your local

Chamber o Commerce may also help in

identiying contract opportunities with private

companies.

http://contractsnder.co.uk/

http://www.undingcentral.org.uk/Deault.

aspx

http://www.ojec.com/Deault.aspx

http://ted.europa.eu/TED/main/HomePage.do

Bibliography:

Selected additional publications which urther

explore some o the issues raised in this ino

sheet:

Catalyzing Consortia: the actors required

or successul social enterprise consortia

cohesion and successul tendering, SELNET,

2009

Collaboration or success: insights into social

enterprise collaboration to deliver public

services in the North West region, SELNET,

2009

Working in a consortium: a guide or third

sector organisations involved in public sector

deliver, Cabinet Oce, 2008

Key points captured from all speakers

and workshop sessions at the Winning

Business event

Partnerships: Using Partnerships to Win

Business

Richard Litcheld, Eastside Consulting

1. Partnerships may arise either reactively in

response to arising contract opportunities,

or pro actively in pursuit o strategic

business development - but both taketime

2. Rather than try and develop new skills

and expertise in house, consider

collaborating with another organisation

who already has them

3. Understand that there will be cultural

dierences between organisations: the

same job title wont carry the same

responsibilities everywhere

4. Be clear what you have to oer other

organisations, as well as what you want/need in return and what youre not willing

to compromise on

5. Remember the pub test - how well do

you think you can get along with these

other people?

Marketing: Get ready for success: How

well do you know your market?

Sara McGinley, Marketing & Communications

Director, Social Firms

1. Have a concise, clear pitch- dont bafe

your potential client with too much detail.

They may not know or care what a social

enterprise is, put yoursel in their shoes,

what are they looking or?

2. What stops your rm buying rom social

enterprises? Empathise with what it is and

get round it when you are trying to sell to

others.

3. Should you create more social enterprisesin an area /sector o the market i ones

already exist, whats your USP?

4. You need a great service and product, the

eel good message is not enough.


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12 Winning Business

5. Make sure you advertise your service in

both the social enterprise arena and where

youd expect to nd it e.g. amongst sector

competitors in yellow pages

Contracts - The elements of your business

that you need to have in place in order

to win contracts in the private and public

sectors.

Facilitator: David Miller, Bikeworks

1. Build a good team around you andensure you can promote their skills and

experience

2. Try or achievable goals, i you are a

smaller organisation look or contracts

with other small organisations.

3. Work on internal contracts, i available, to

increase your experience, job record and

sustainability.

4. I you miss out on a bid, nd out who got

the bid and why

5. Similarly i you miss out on a quote, ndout what the other quotes were ater the

process and then look into re-pricing your

service

Being Investment Ready - How do you

make your business investment ready?

What are investors looking for and how do

you demonstrate you have it? this was

combined with workshop 3.

Facilitator: Danny Wilson, Big Issue Invest

1. Shop around or investors as some will be

better suited or your needs

2. Look into the dierent types o investment

are you looking or a loan or an

investment?

3. Investors are looking or clear business

plans

4. Investors invest in people as well as the

business model, thereore be seen to be

proessional at all times and demonstrateyour passion and ambition

5. Scale and robustness is important to

investors, thereore the more contracts

you have the better

Where are the contracts? - How do you

nd new contracts? What do you need

to have in place to demonstrate you can

deliver?

Facilitator: Sian Thomas, TCUK

1. Knocking on doors, and getting the right

contact details can be a challenge but is

essential

2. Attend local business orums and

networking events

3. Dierent sectors have dierent rules andregulations check these and make sure

that you are in a position to respond to

their needs

4. Use the Chamber o Commerce to nd up-

to-date inormation on local businesses

5. Make sure that you target your pitch (e.g.

elevator pitch)

6. Keep going!

Social Value, is it valuable?

Facilitator: Adrian Ashton, www.adrianashton.co.uk

1. Its import to identiy your social value to

inorm internal business planning and

prioritising o your development ideas

2. Presenting your social value/impact

reports to customers or commissioners

shouldnt be automatic - only share them i

relevant and theyre likely to be interested

in what it shows

3. There are benets, but also limitations,to using existing tool-kits and measures

- especially as they allow or easier

benchmarking, but may mean you miss

important stu

4. Given the wide number o such tool-kits

and standards, it can be dicult to choose

which is appropriate without investing time

in exploring the options


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3xE Network

Crisis

66 Commercial Street

London E1 6LT

Tel 020 7426 8500Email [email protected]

www.crisis.org.uk/3xe

Registered Charity Numbers:

E&W1082947, SC040094.

Documents

3xE_Winning Business Final