Social business is an area of entrepreneurship that's constantly growing. Social businesses aims to provide basic and beneficial services in education, healthcare, sanitation and energy and businesses like these often face big challenges in terms of scaling growth.
A study recently published in the Journal for Cleaner Production suggests 2 methods for social businesses to scale up and identified 4 strategies to help these types of business grow, especially in developing countries and their emerging markets from people can benefit the most.
The study was done by researchers from the University of Cambridge and identified these 4 key strategies of growth for social businesses: market penetration, market development, product development and diversification. The 2 methods are identified as increasing revenue per stream and diversifying revenue streams.
The main challenges social businesses face in developing countries include the lack of electricity and infrastructure like roads as well as property rights and well-functioning courts.
However emerging technologies and social initiatives like public-private partnerships are making the future brighter for social businesses.
Professor Jaideep Pradhu from Cambridge Judge Business School said, "Social businesses have enormous potential to provide important services to billions of people around the world - but they need to scale up in order to meet these needs. This study is a first step to greater understanding in this area, but we need a lot more work to support the development and growth of such businesses."
Dr. Shawn Carraher, clinical professor of organizations, strategy and international management at the Naveen Jindal School of Management at University of Texas at Dallas recently published a study in the European Journal of International Management wherein he laid down an eleven-part scale for social businesses to gauge their performance and progress. The paper also specified differences between traditional and social businesses.
"In traditional entrepreneurship, you're trying to do something that will help a specific group of individuals, and ideally, it should bring compensation to the entrepreneur. In social entrepreneurship, you tend to look more at the general good than at the good of the entrepreneur." Carraher said.
Social business is considered an important asset in terms of development and advancing the needs of those in developing areas. Their objective of providing services over earning marginal profit is what makes these types enterprises stand out.
Last year governments of the world united and declared 17 Social Development Goals (SGDs) designed by the United Nations to "end poverty, fight inequality and injustice and tackle climate change by 2030."
