Ecogard IO4 unit 1 what is social enterprise with changes EN

1. IO4/Unit 1:
What is a social enterprise?
2017-1-BG01-KA202-036212

2. 2
The definition of a social enterprise
How to establish a social enterprise
A legal framework (policies and regulations) for
establishing a social enterprise in Slovenia,
Belgium, Bulgaria and Turkey
A checklist for creating a social enterprise
Table of contents

3. The definition of a social enterprise
Organizational
structure of the
company
based on democratic
principles and equality of
all employees
Business model
which ensures
financial
sustainability of the
company
Entrepreneurial
idea
which resolves a
particular social
problem
SOCIAL
ENTERPRISE
Video: What is social entrepreneurship?
https://www.youtube.com/watch?v=1ecKK3S8DOE
People
Social
Performance
Planet
Environmental
Performance
Profit
Economic
Performance

4. OBJECTIVES social
entrepreneurship
Strengthening
social solidarity
and cohesion
Encouraging the
participation of
people
Strengthening the
company's ability
to solvesocial and
other problems
Providing an
additional offer
of products and
services that are
in the public
interest
Promoting
social
innovation
Developing new
employment
opportunities
additional jobs
for a group of
vulnerable
people in the
labor market

5. 5
 Principles of Social Entrepreneurship
1
Individual
incentive
2
Non-profit
3
Public interest
activities
4
Voluntary action
5
Independence
6
Market
orientation
7
Including
volunteers
8
Equality of
memberhip
9
Stakeholder
involvement in
management
10
Transparency in
business
11
Socially useful
work

6. 6
 Development of a Social Enterprise idea
1. Designing a business model using a lean frame
2. Testing the problem (field interviews)
3. Testing the solution (entered new information into your lean frame, it's time to build your own
prototype and test it)
How to establish a social enterprise
1. PROBLEMS
NEEDS
4. SOLUTION 3. VALUE
PROPOSITIONS
9. SOCIAL
EFFECTS
2.
CUSTOMER
SEGMENTS
8. KEY
RESOURCES
5. CHANNELS
7. COST STRUCTURE 6. REVENUE STREAMS
field interviews

7. 7
How to establish a social enterprise
1.
PROBLEMS
NEEDS
4.
SOLUTION
3. VALUE
PROPOSITIONS
9. SOCIAL
EFFECTS
2.
CUSTOMER
SEGMENTS
8. KEY
RESOURCES
5.
CHANNELS
7. COST STRUCTURE 6. REVENUE STREAMS
PROTOTYPE
TEST IT
Enter new information into your lean frame

8. 1. Investment costs:
 The preparationof documentation and
obtainment of permits
 Land
 Soil and land preparation works
 Construction and other skilled work
 The purchase and installment of
equipment and devices
 Consultation and supervision of
implementation
 Education and training
 The purchase of working capital
necessary for production
Creating a Simplified version of Financial Plan
2. Operational costs:
 Capital equipment (buildings,
equipment, small inventory, etc.)
 Objects of work (resources, materials,
small inventory, energy)
 Services (repair, production, postal,
accounting services,etc.)
 Workers and the workforce
At least 10 % of the total budget should be reserved
for unforeseen costs.

9. Financial plan
One-time start-up costs Monthly costs
What Sum What Sum
Purchasing equipment Maintenance of machines
Creating a website Fuel
Purchasing packaging Labour costs (salaries)
Creating promotional material Marketing
Purchasing a computer Stationery
Purchasing a car Repayment of credit
… …
… Unforeseen costs
An example of a simplified financial plan

10.  Creating a Marketing Plan
The concept of marketingcovers four areas (“the 4Ps of marketing”):
1. Promotion
2. Price
3. Place
4. Product
1. PROMOTION
- The production of a brand (logo, symbols, stamp …)
- Classic advertising(posters, brochures, flyers …)
- Onlineadvertising
- Personal selling (door-to-door …)
- Sales promotion (pay 1 get 2 …)
- Public relations (blogs, conferences, television, radio …)
- Direct marketing (telephone sales, sales letters (ordinary and e-mail) …
door-to-door

11. 2. PRICE
 Material costs (resources, packaging)
 Service costs (postal services, telecommunications services, transport services,
rentals, the costs of externalexperts, etc.)
 Depreciation costs arising from the use of buildings, machinery and equipment
 Total labour costs (regular employees and contract staff members)
3. PLACEMENT
 Independent stall
 Onlinestore
 Websites
 Renting a sales space in (online) stores
 An agreement with other merchants to sell your product by making a special offer
or give it as a prize
 Exhibitionspace at fairs
 Mobile stores (delivering to distant villages and hamlets)
 Franchisingis when other merchants sell your products under conditions you set
(this is only possible for established brands)

12. 4. PRODUCT
You should answer the following two questions, because they are the key to your
business success:
 What do your customers really want/need?
 What makes your product stand out on the market?
The lean frame is based on the product since it provides answers to the following
questions:
 What are the customers' needs and problems?
 Who are the customers?
 What makes your product so important to the customers that they will pay for
it?

13.  Employment
How you organize your company depends on the type of activity, the nature
of your work, and your competences.
Susceptible to
the current
social situation
Able to make use
of modern
technology
Patient and
persistent
A team player Skilled in
communication
Energetic and
optimistic
A social entrepreneur must be:

14.  Employment
You can be an expert in a certain field, but if you are weak in some other
area you will not last long on the market.
In the above scenario you have two options:
1. to gain missing competences by additional training or
2. gather a team of staff that will be able to make a successful market
entry.

15.  Employment
Dependingon your decisions or capabilities the cooperation will take the form of:
Employment
student work
contract
work
employment
contract

16. A legal framework (policies and regulations) for
establishing a social enterprise in each partner country
Countries with specific legal forms or statutes for social enterprise
 SLOVENIA: Act on Social Entrepreneurship(2011). Since 2015, social entrepreneurshiphas been
assigned to the Ministry of Economic Development and Technology.
 BELGIUM: Social purpose company
 BULGARIA: As of 2014, according to the National Social Economy Concept, social enterprises in
Bulgaria are businesses which produce goods and services for the market economy and allocate
part of their resources to the accomplishment of social and economic goals.
 TURKEY: No legal regulations
Countries with policy frameworks targeting social enterprise
 SLOVENIA: Strategy for Social Entrepreneurshipdevelopment for the period 2013-2016 and draft
Action Plan 2014-2015
 BELGIUM: The Flemish policy framework provides a great deal of financial and other support for
social entrepreneurshipwithin the field of competence of the social economy. See
https://www.socialeeconomie.be/regelgeving.
 BULGARIA: National Social Economy Concept and accompanying Action Plan 2014-2015
 TURKEY: Regulations to be done are includedin the Strategic Plan 2018-2022. See:
http://ticaret.gov.tr/data/5b921d6513b87613646656ac/Stratejik_Plan_2018_2022.pdf

17.  Registration of a Social Enterprise in Slovenia (so.p.)
The current law states that the status of a social enterprise can only be
awarded to:
 a non-profit legal entity such as a society,
 an institute,
 a company,
 a cooperative, a European cooperative,
 an employment centre,
 a company employing people with disabilities,
 a company or other legal entity governed by private law that meets the
principles of social entrepreneurship as well as the conditions stated in
the law.

18.  Registration of a Social Enterprise in Slovenia
The status of a social enterprise may be acquired by a non-profit legal
entity which:
 performs economic and non-economic activities;
 does not distribute the assets or the profit;
 in terms of independence and organization is autonomous in relation to
for-profit companies, legal entities governed by private law, and local
communities;
 provides an inclusive system of governance based on participation and
democratic decision-making; and
 meets other conditions stipulated by the Law and the Act that defines
the legal organization of non-profit legal entities.

19.  Registration of a Social Enterprise in Slovenia
If an individual non-profit legal entity is already registered it needs to
obtain the status of a social enterprise; if not it can do both at the
same time with the competent registration authority.
The status of a social enterprise cannot be acquired in the following
cases:
 Sole proprietors
 Agricultural holdings or supplementary activities on farms
 Other individuals (non-legal entities that can also realize social
entreprise ideas)
The application for registration of a non-profit legal entity as a social
enterprise is submitted to the competent registration authority.

20. Registration procedure in Slovenia
Non-profit legal
entity
Society Institute Foundation Company (of special interest),
Cooperative, European
cooperative
Legal basis for
registration/
issuing consent
• Societies Act
• Vocational Rehabilitation and
Employment of Disabled Persons Act
• Institutes Act,
• Vocational Rehabilitation and
Employment of Disabled Persons
Act
• Foundations Act • Companies Act
• Cooperatives Act
• Vocational Rehabilitation and
Employment of Disabled Persons Act
The ministry
responsible for the
law that is the
basis of
registration/social
enterprise
registration
• Ministry of the Interior
• Ministry of Labour, Family, Social
Affairs and Equal Opportunities in
the caseof employment centres
• Ministry of Public Administration
• Ministry of Labour, Family, Social
Affairs and Equal Opportunities in
the caseof employment centres
and sheltered workshops
(sheltered employmentcentres)
• Ministry of the
Interior
• Ministry of Economic Development
and Technology
• Ministry of Agriculture, Forestry and
Food
• Ministry of Labour, Family, Social
Affairs and Equal Opportunities in
the caseof sheltered workshops
(sheltered employmentcentres)
Registration
authority
• Administrativeunit in the area where
the company's main office
• Ministry of Labour, Family, Social
Affairs and Equal Opportunities office
is located in the caseof social
enterpriseregistration of an
employment centre
• Districtcourts
• Court register
• Ministry of Labour, Family, Social
Affairs and Equal Opportunities
in the case of social enterprise
registration of an employment
centre
• Competent
ministry for
issuing an
approvalof the
Articles of
association
• Districtcourts / Court register
• Ministry of Labour, Family, Social
Affairs and Equal Opportunities in
the caseof social enterprise
registration of an employment
centre

21. Conditions for establishment They are defined in the Social Entrepreneurship Act (in particular, Articles
3, 8, 9, 12 and 14) and the legislation regulating the organizationof a
particular type of non-profit legal entity
Application for registration/social
enterpriseregistration
In addition to the content and
attachments requiredfor the
establishmentof an individual non-
profit legal entity, the registration
application form contains documents
as stated in Article 14 of ZSocP-A
• Articles of association (Article 12 of ZSocP-A)
• A decision by the founders or competent body of a non-profit legal
entity to operate as a social enterprise
• The names, personal registration numbers, nationality and permanent
or temporary addresses of all authorised representatives and the scope
of powers for societies
• Evidence of the potential sum for the commencement of the operation
or the value of the society's assets
*Same applies also to an application for the registration of the
amendments to a memorandum or articles of association restructuring a
non-profit legal entity into a social enterprise.
Registration procedure in Slovenia

22. A checklist for creating a social enterprise
 About social entrepreneurship
 Introducing the term social entrepreneurship
 Introducing the goals of social entrepreneurship
 Development of a Social Enterprise Idea
 Designing a business model using a lean frame (evaluation)
o problems/needs
o customer segments
o value propositions
o solution
o channels
o revenue streams
o cost structure
o key resources
o social effects
 Testing the problem (interviews)
 Testing the solution
o Build your own prototype
o Test it

23. A checklist for creating a social enterprise
 Financial Plan
 Evaluate investment costs
 Evaluate costs that will be incurred monthly or (some) annually
 Creating a simplified version of Financial Plan
 Marketing plan
 Promotion
o The production of a brand (name, logo, symbols ...)
o Classic advertising (posters, brochures, flyers ...)
o Online advertising (FB, Twitter ...)
o Personal selling (door-to-door ...)
o Sales promotion (pay 1 get 2 ...)
o Public relations (blogs ...)
o Direct marketing (telephone, letters ...)
*You can use one or more communication tools to achieve their marketing goals and strategies.

24. A checklist for creating a social enterprise
 Determination of the price of the product
 Determination of the sales channels
 Independent stall
o Online store
o Websites
o Renting a sales space in (online) stores
o An agreement with other merchants to sell your product by making a special offer or give it
as a prize
o Exhibition space at fairs
o Mobile stores
o Franchising
*You can use one or more sales channels.
 Employment
 Employment of oneself and colleagues
 Getting finance to start a business
 Application to a call for tenders

25. A checklist for creating a social enterprise
 Registration of a Social Enterprise in Slovenia
 Preparing an application for registration
o Articles of association
o A decision by the founders or competent body of a non-profit legal entity to
operate as a social enterprise
o The names, personal registration numbers, nationality and permanent or
temporary addresses of all authorised representatives and the scope of powers
for societies
o Evidence of the potential sum for the commencement of the operation or the
value of the society's assets
 Submitting an application to the competent registry authority

26. Sources
 Ministrstvo za gospodarski razvoj in tehnologijo (Ministry of Economic Development
and Technology of the Republic of Slovenia).
http://www.mgrt.gov.si/delovna_podrocja/socialno_podjetnistvo/
 https://sredisce-rotunda.si/wp-
content/uploads/2013/08/Delavnica4_Od_ideje_do_izvedbe_podjetni%C5%A1ki_prist
op.pdf
 Stritar T., Pipan D. (2015). Podjetniški priročnik z delovnim zvezkom za socialne
podjetnike: od ideje do socialnega podjetja z družbenim učinkom. Ljubljana,
Ministrstvo za kmetijstvo, gozdarstvo in prehrano (Ministry of Agriculture, Forestry
and Food).
 Mesojedec T., Šporar P., Strojan K., Valentinčič T., Bačar F., Sakovič G. idr. (2012).
Socialno podjetništvo. http://www.socialni-inovatorji.si/knjiga/socialno-
podjetnistvo
 Social EntrepreneurshipAct (ZSocP) (2011). Uradni list Republike Slovenije.
https://www.uradni-list.si/glasilo-uradni-list-rs/vsebina/102703
 Zakon o spremembah in dopolnitvah Zakona o socialnem podjetništvu (ZSocP-A)
(2018). Official Gazette of the Republic of Slovenia. https://www.uradni-
list.si/glasilo-uradni-list-rs/vsebina/2018-01-0545?sop=2018-01-0545
 A map of social enterprises and their eco-systems in Europe, European Commission, A
report submitted by ICF ConsultingServices, (2014).

27. Sources
 A map of social enterprises and their eco-systems in Europe, European
Commission, Synthesis Report, (2015).
 Alexanedr Osterwalder, Yves Pigneur. 2010. Business Model Generation. New
Jersey: John Wiley & Sons, Inc. www.businessmodelgeneration.com
 Kezele K. 2017. Socialno podjetništvo v Sloveniji.
http://www.verjamemvate.si/wp-
content/uploads/2018/03/Diplomska_naloga_Kezele-Karin.pdf

28. Disclaimer
For further information, related to the ECOGARD project, please visit the project’s website
at https://ecogardening.eu/ or visit us at https://www.facebook.com/Ecogard/.
Download our mobile app at
https://play.google.com/store/apps/details?id=com.ecogard.mobile.
This project ( ECOGARD project - 2017-1-BG01-KA202-036212) has been funded with
support from the European Commission (Erasmus+ Programme). This publication reflects
the views only of the author, and the Commission cannot be held responsible for any use
which may be made of the information contained therein.