Social Business - An Introduction

The main similarity between traditional businesses and a social businesses is that they both try to maximise profit by charging consumers for goods and services. However, there is one main difference between the traditional business model and the social business model. The traditional business is designed to earn the maximum income for the owners of the business. In contrast, the objective of a social business is to provide the maximum amount of social benefit for its consumers. As a result there is a difference in how profit is used in either model. In a traditional business a portion is taken as personal profit by the owners and another portion is reinvested back into the business. In contrast, a social business reinvested all its profits back into the business for expansion. This means that any profit that is made from the businesses' customers is then reinvested back into improving the goods and services that the customers receive and improving their community.

The advantage of the social business model is that it creates a snowball effect where it only takes one donation at the start to get the ball rolling. After that the possibilities are endless because it can continue to grow using only the fees that it charges for its goods and services. This is the benefit that the social business model provides over the traditional charity model. It is a faster way to help the most people possible. The two models are similar in their objectives for combating a specific social problem, however, the social business allows for an approach which can grow faster and reach more people.

Examples of Social Businesses

• Grameen Bank (Microfinance Institution)
• Grameen Knitwear (Garment factory) (Blog Post)
• Grameen Fisheries and Livestock (Blog post)
• Grameen Danone (Vitamin Enriched Yogurt) (Blog post)
• Grameen Healthcare Services (Eye Care Hospital) (Blog post)
• Grameen Kalyan (Health Insurance)
• Grameen Veolia (Arsenic Free Water)
• Grameen Shakti (Alternative Energy)
• Grameen Fund (SME Finance) (Blog Post #1 and #2)
• Grameen Shikkha (Education)

In Canada:

• Be the Game / Be the Puck (link)
• Me to We (link)