Social Franchising


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June O'Sullivan, London Early Years Foundation, 16th February 2011

For What it's Worth: Can Social Enterprises Deliver Local Services?

Social Firms UK and London Early Years Foundation
London Working Together Network

Published in: News & Politics
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Social Franchising

  1. 1. Scaling up social enterprise: strategies for early years provision LEYF Research Project
  2. 2. Our History
  3. 3. Our Service ... the child is the connector.
  4. 4. Value Driven Constant 100 years old and able to go on. Child focused Putting the child at the centre. Courageous Able to take risks and test new ideas, standing up for what we believe in. Creative Creating and inventing, being innovative and challenging what already exists. Consultative Involving and consulting the children, parents, staff and supporters.
  5. 5. The Social Enterprise Model <ul><li>“ are businesses with primarily social objectives whose surpluses are principally reinvested for that purpose in the business or in the community, rather than being driven by the need to maximise profit for shareholders and owners.” </li></ul><ul><li>DTI </li></ul><ul><li>Such businesses are seen as contributing to: </li></ul><ul><li>• raising productivity and competitiveness; </li></ul><ul><li>• socially inclusive wealth creation; </li></ul><ul><li>• enabling individuals and communities to foster local regeneration; </li></ul><ul><li>• demonstrating new ways to deliver public services; </li></ul><ul><li>• fostering an inclusive society with an active citizenship </li></ul>
  6. 6. Our Triple Bottom Line <ul><li>The true purpose of business is to add value and make a difference – not just by providing useful services but also by adding value to the lives of employees, adding value to the life of the community, and adding value for the sake of future generations by treading as lightly as possible on the planet. </li></ul>
  7. 7. Why Childcare ? <ul><li>Investing in early years is as close as it gets to magic without being magic. Parenting support and enriched day care, preferably both together create children with better behaviour and attitudes who will arrive at school with a capacity to learn” Sinclair (2006) </li></ul>
  8. 8. 1 KTP Research Project
  9. 9. Project aims <ul><li>“ To examine the LEYF social enterprise childcare business model and assess how it could be developed to scale up its social impact” </li></ul><ul><li>Identify the quality standards and management systems which would underpin a franchising model </li></ul><ul><li>Support the creation of a package of training and consultancy </li></ul><ul><li>Develop a social enterprise childcare network </li></ul><ul><li>Influence policy makers and commissioners </li></ul>
  10. 10. 2 First Steps
  11. 11. Why Social Franchise?
  12. 12. Why Franchise? <ul><li>Business Franchise </li></ul><ul><li>Proven Business Model </li></ul><ul><li>Established Market </li></ul><ul><li>Initial Training </li></ul><ul><li>Ongoing Support </li></ul><ul><li>Benefit from Economies of Scale </li></ul><ul><li>Research and Development </li></ul><ul><li>Access to Finance or so say the banks! </li></ul><ul><li>Social Franchise </li></ul><ul><li>all this plus </li></ul><ul><li>Maximise Social Benefit </li></ul><ul><li>Grow the Business </li></ul><ul><li>New source of Income </li></ul><ul><li>Replication and Scaling Up to benefit more quickly </li></ul>
  13. 13. Project stages <ul><li>Phase 1 - 2010 </li></ul><ul><li>Market research on existing social enterprise childcare providers </li></ul><ul><li>Identify models of good practice social enterprise childcare </li></ul><ul><li>Propose models of franchising and scaling up for LEYF </li></ul><ul><li>Phase 2 - 2011 </li></ul><ul><li>Develop and test the models for franchising and scaling up </li></ul><ul><li>Develop training and consultancy packages to support scaling up </li></ul><ul><li>Use learning to win new childcare provision bids / consulting </li></ul><ul><li>Embed knowledge within LEYF and support wider dissemination </li></ul>
  14. 14. 3 The story so far…
  15. 15. Social enterprise childcare model High Quality Financially Viable Social Mission
  16. 16. The LEYF model <ul><li>Socially inclusive </li></ul><ul><li>Socially responsible </li></ul><ul><li>Socially entrepreneurial </li></ul><ul><li>Delivers social enterprise children’s curriculum </li></ul><ul><li>Invests profits for social mission </li></ul><ul><li>Builds intergenerational community connections </li></ul><ul><li>Offers staff development and involvement </li></ul>
  17. 17. <ul><li>A - Growth within the organisation </li></ul>Increasing potential scale of impact of innovations Decreasing control over how innovations are implemented B - Scaling through formalised franchisees C - Open access sharing and disseminating good practice Strategies for scaling up
  18. 18. Social franchising <ul><li>Effective franchise systems comprise: </li></ul><ul><li>A strong brand </li></ul><ul><li>Products and services that have been shown to be competitive in relevant markets </li></ul><ul><li>The franchisor’s ability to give ongoing and effective assistance to and inspection of franchisees </li></ul><ul><li>Franchisees that are willing and able to pay the franchise fee </li></ul><ul><li>Additionally: </li></ul><ul><li>Social entrepreneurs must remain focused on a core ‘social value proposition’ </li></ul>
  19. 19. Potential franchisees charity / social enterprise bolt on charity offload / struggler local authority spin out Organisation aspiring start-up ethical manager ethical owner LEFY spin out Individual Aspiring Nursery Existing Nursery
  20. 20. Three possible approaches <ul><li>Matriarchal ‘strict’ franchising </li></ul><ul><li>(e.g. School for Social Entrepreneurs) </li></ul><ul><li>Fraternal ‘partnership’ franchising </li></ul><ul><li>(e.g. Brook) </li></ul><ul><li>Friendly ‘open source’ replication </li></ul><ul><li>(e.g. Unicorn) </li></ul>
  21. 21. LEYF offer to franchisees – what would it look like? <ul><li>‘ Business in a Box’ </li></ul><ul><li>LEYF childcare operations manual </li></ul><ul><li>Childcare policies and procedures </li></ul><ul><li>Network Support </li></ul><ul><li>Training opportunities from CRLD </li></ul><ul><li>LEYF newsletter, website and annual conference </li></ul><ul><li>Information briefings on relevant topics </li></ul><ul><li>Social gatherings </li></ul><ul><li>Use of the LEYF Brand </li></ul><ul><li>Central Services </li></ul><ul><li>Ongoing visits to provide support and monitor quality standards </li></ul><ul><li>Ongoing professional services </li></ul><ul><li>Fee structure model </li></ul><ul><li>Central volume purchasing </li></ul><ul><li>General help desk </li></ul>
  22. 22. Additional options <ul><li>Training and consultancy </li></ul><ul><li>Membership federation </li></ul><ul><li>Branching </li></ul><ul><li>Quality mark </li></ul>
  23. 23. 4 Next Steps
  24. 24. Our Next Steps <ul><li>Franchise feasibility and market test </li></ul><ul><li>Development of LEYF operations manual </li></ul><ul><li>Examine the Franchisor business structure </li></ul><ul><li>Consider a Pilot </li></ul><ul><li>LEYF to make decision on approach to scaling up </li></ul>
  25. 25. Challenges for Scaling the Idea <ul><li>Lack of an agreed Definition </li></ul><ul><li>Lack of Experience </li></ul><ul><li>Lack of Understanding </li></ul><ul><li>Lack of Good Examples </li></ul><ul><li>History of Failure </li></ul><ul><li>Lack of Resources </li></ul><ul><li>Cultural Barriers </li></ul>
  26. 26. Applying LEYF Measurement Model (Measurement Analysis Rating Impact Indicators MARII) <ul><li>Input : Resources to run activity (money / people/facilities / equipment) </li></ul><ul><li>Output : Direct and tangible products from the activity (number of people training / occupancy) </li></ul><ul><li>Outcome : Changes that take place in stakeholders as a result of the activities ( ++ parents into work / reduced dependence on benefit) </li></ul><ul><li>Impact : Are the outcomes adjusted for deadweight + displacement (effects of what would have happened anyway + the extent to which the outcomes displace other orgs) </li></ul>
  27. 27. Despite the challenges our vision remains that we at LEYF remain committed to: <ul><li>creating a cohesive, comprehensive, web of support for children and families which will require courage, determination, enthusiasm and resolve to achieve. </li></ul>
  28. 28. Come and Visit <ul><li>June O’ Sullivan </li></ul><ul><li> </li></ul><ul><li>0207 8348679 </li></ul>