Social Enterprises as a mechanism to deliver AONB projects

Tim CrabtreeWessex Community Assets

&Cardiff University

Wessex Community Assets

Small not for profit organisation which supports the development of community and co-operative enterprises:• Renewable energy• Sustainable food• Affordable housing• Cultural sector• Workspace

Wessex Reinvestment Trust group

Established in 2001, the group has 4 separate structures:

• Wessex Reinvestment Trust, a registered charity.• WRT Core Company Limited, which provides home

improvement lending.• Wessex Community Assets, which supports

community asset development.• Wessex Reinvestment Society, has provided

business loans.

Examples of Wessex Reinvestment Trust group activities 2010 - 2012

Wessex Core Company:

Home Improvement

Lending

Business advice , e.g.

The Real Food Store, Exeter

The Community Farm, Bristol

North Dorset Food Incubator &

Training Network

Business advice , e.g.

Bridport Energy Services Ltd:

Zero carbon food production

Partnership with SW Protected Landscapes

Forum:Social Forestry

Business advice , e.g.

Lyme Regis Development Trust

Red Brick Building Centre,

Glastonbury

Enterprise St. Michael’s, Bridport

Housing Food Renewable Energy

Workspace & Community

Assets

Somerset, Devon & Dorset

Community Land Trust Project

Housing

Wessex Community Assets

What is social enterprise?

Social enterprise can be thought of as:• a particular type of organisation (i.e. a business with

a primary social or environmental aim, which returns any surplus to the community which it serves)

or as:• an activity carried out alongside the existing

programmes of community and voluntary sector organisations (i.e. trading activity which either meets the primary purpose of the organisation or creates surpluses to fund services for the community).

Common characteristics of social enterprise

Maximum public benefit

Maximum private benefit

Charity Share company

The “grey area” in the middle of the spectrum

is where social economy organisations operate

No trading revenue

Trading revenue &

grants

Potentially sustainable:

50%+ trading revenue

Breakeven – all

revenue from

trading

Profitable – surplus

not distributed

Profit distributing – socially

driven/ mutual

Profit maximising

Charities/vol orgs Revenue generating social enterprises

Socially driven

business

“Trad-itional”

business

High social return High financial return

Waitrose

Co-op Group

Whole Food

Markets

Green & Blacks (Cadburys)

Rachels Dairy

Local Food Links

Dorset Farmers’ Markets

Somerset Local Food Direct

West Dorset Food & Land Trust

Dorset Food & Health Trust

Somerset Community Food Projects Network

Is “social enterprise” relevant to AONB’s?

• AONB’s have core teams delivering statutory duties – conserving and enhancing protected landscapes.

• Most AONB teams have also developed the capacity to secure additional resources and deliver projects, e.g.– Woodland management– Access / recreation– Grassland management

So – AONB teams already have 2 key resources which support delivery of core

functions and projects:

Grant Finance

People Local communities

Citizens

Core functions&

projects

Some AONB’s have established (or are considering) charitable trusts

• To secure grant funding & donations not available to LA-hosted AONB teams

• To use such funds to deliver additional projects• To receive transferred assets from public bodies

or bequests• To acquire assets, using grants and loans• To engage with the community• To undertake “primary purpose” trading activity

AONB Team in Local

Authority

Local AONB Trust

Social enterprise activity n

Social enterprise activity 2

Social enterprise activity 1

+ +

Possible way forward

AONB Team AONB Trust

Local communities

Projects&

Services

Social enterprise activity

Direct trading

Subsidiary

Lease assets

Support IPS

Joint venture

Example of trust undertaking project delivery and primary purpose trading

West Dorset Food and Land Trust– Charity, established 1998

West Dorset Food Week & Bridport Food Festival

The local food sector in West Dorset:Mapping exercise resulting in Directory

Grow it, Cook it, Eat it Project

Asset based development

• West Dorset Food & Land Trust a member of the Development Trusts Association (now Locality)

• Assets can generate income – e.g. building rentals or land tenancies

• Decision to develop managed workspace – a “Local Food Centre”

Bridport Centre for Local Food

Bridport Centre for Local Food

Bridport Centre for Local Food

Charities are restricted in the range of trading that they can undertake

so may establish subsidiaries

Local Food Links– Trading company, established as

subsidiary of West Dorset Food and Land Trust in 1999

Farmers’ Markets

School Fruit Scheme

Soup Lunch Pilot

Soup Lunch Pilot

Other examples of Trusts setting up trading subsidiaries

The Isle of Eigg Heritage Trust

Eigg Electric

Lyme Regis Development Trust

•St. Michael’s Business Centre

•Wessex secured £100,000 grant from ChangeUp, provided £13,000 loan and negotiated £35,000 Programme Related Investment from Community Foundation for Bournemouth, Dorset & Poole

Lyme Regis Development Trust

• New assets:– Youth café with flat– Youth centre– Monmouth house – flats

• Supports project activity, e.g.– Fossil Festival

• Developing proposals for £8 million Field Studies Centre with Natural History Museum

Trusts do not have to run operations themselves or

through subsidiaries

• Trusts can use their assets to support social economy activity– At a discounted rent, where the enterprise

delivers against the Trust’s objects– At a market rent.

Local Food Links Ltd

• Restructured into a Community Benefit Society (a form of Industrial & Provident Society), with membership open to parents, schools, wider community

• Previously, Local Food Links only had one member – the Trust

New Central Kitchen at Centre for Local Food

Local Food Links: ethical sourcing

• Meat – Genesis Farmers• Milk – Coombe Farm• Yogurt – Yeo Valley• Butter – Denhay Farms & Coombe Farm• Cheese – Denhay & Coombe Farm• Flour – Edward Gallia, Cerne Abbas• Eggs – Vurlands Farm• Vegetables in season – Bothen Hill Organic,

Washingpool Farm, Somerset Organic Link• Fruit in season – Elwell Farm• Bread – Leakers, Punch & Judy Bakery• Food service – Essential Trading

Local Food Links – current status

• Two hub kitchens – one leased from West Dorset Food & Land Trust, one from Dorset County Council

• 25 staff• 24 schools, 3 nurseries, 1 day centre, 8

lunch clubs• 1200 meals per day• Turnover: over £500,000 p.a.

Hostetin Apple Juicing Plant, Czech Republic

Veronica Foundation

Hostetin Apple Juicing Plant

Raised funds

Leased to

White Carpathians Traditions

Apple Juicing Social

Enterprise

Runs

Apples

Small farms

Trusts can enter into joint ventures

Joint Venture:

Grameen – Danone Yogurt Business

Grameen-Danone Shoktidoi yogurt factory in Bangladesh

Real Wood Studios Ltd., a cooperative of wood workers

Woodschool Ltd

Majority shareholder

Minority shareholder

Trusts can lease assets to private companies or social

enterprises

£1 million raised from community shares

Fordhall Community

Land Initiative:

owns land and public access

facilities

Fordhall Farm Ltd:

lifetime tenancy

Land

Rent

The Earth Trust

• Set up as the Northmoor Trust for Countryside Conservation in 1967, with a large endowment from Sir Martin and Audrey Wood

• Now own 1,200 acres of farmland, woodland, nature reserves, research plantation and wetland

• Also: management of three community meadows, Thrupp Lake at Radley,

• 30 staff, 100 regular volunteers • 750 regular supporters• Around 30,000 people each year take part in

Trust activities annually

Cultivate

Trusts can link with Community Benefit Societies

which then run social enterprises

Tablehurst & Plaw Hatch Community Farm

• Founded in 1995 following a community-led campaign that raised over £150,000 to purchase the stock and business assets of Tablehurst Farm from Emerson College.

• Now 400 members of the IPS, each paying £100 for their share.

• The land – 800 acres – is owned by a Trust.• The Trust leases the land to the IPS.• The IPS has 2 subsidiary trading businesses

Tablehurst & Plaw Hatch Community Farm

West Oxford Community Renewables

WOCR

Solar PV

Hydro

Wind

Wood

Susta

inable

Living

Investors Funds

Green energy

Reducing energy bills

Local food projects

Low carbon travel

Reducing waste

Planting trees

Sharing resources

LCWO£

Financial, carbon and social return to investors

IPS CHARITY

Helping communities raise local finance through share issues & loans

£152,775 raised £105,000 raised

Amount Subscribed Number of Subscribers

Totals at each Subscription Level

£100 157 £15,700

£200 47 £9,400

£500 36 £18,000

£1000 21 £21,000

£20,000 2 £40,000

REAL FOOD EXETER: Analysis of the share register on closure at 30 September 2010

The Community Farm

• In November 2010, the Community Farm launched their community share offer inviting members of the public to invest in a 22 acre horticulture operation.

• By the end of March 2011, 409 people had invested £126,000 in the Community Farm.

• This investment has enabled The Farm to take over the established veg box scheme, organic growing and wholesale business of the Better Food Company.

£1,600,000 raised

Community share societies

Trade sectorPost 2009 societies

Pre 2009 societies

Members Share capital

Renewable energy 59 13 9,642 £17,450,000

Community shops 37 9 4,472 £1,103,000

Community regeneration 15 9 3,668 £2,086,000

Food & farming 23 4 10,430 £1,199,000

Consumer co-operatives - 208,553,000

£191,275,000

Pubs and brewing 11 2 1,265 £1,343,000

Community finance 3 9 1.837 £2,114,000

Community land trusts 10 2 558 £35,000

Fair trade 2 1 9,222 £26,151,000

Other 16 9 38,367 £7,260,000

Totals 176 78 8,638,000 £255m

Members improve competitive advantage

Members roles How these roles improve competitive advantage

Investor Lower cost of capital; greater acceptance of risk

Customer Greater loyalty; accept higher prices & dividend

Service user Demonstrates support to funders; better feedback

Activist More engagement; better feedback; better targeting

Volunteer Lower labour costs; access to specialist skills

Suppliers Greater loyalty; lower input prices

Workers Greater loyalty; lower input prices; better feedback

Directors Access to specialist skills; lower input prices

Community Supported Forestry

• WCA working with SW Protected Landscapes Forum to explore the potential for community engagement in woodland management.

• Would involve elements of the CSA and Care Farming approaches

• West Dorset Woodfuel Co-op to be establshed as IPS.

• In the long term could be share issue to purchase woodland – Tamar AONB exploring pilot

Local Food: Different forms of support

• Sector specific support, e.g. CSA’s• Specialist Enterprise Support• Advice on governance / legal

structuresAlso:• Dissemination / sharing learning• Social franchising or licensing• Spin offs

Primary Production Processing Distribution Retail/Food

Service

Cons

umpti

on

Enterprise Support

Food Mapping

Governance & Legal Structures

Local Food Systems

Local Shops

Food Co-ops & Buying Groups

Home Produced Food

Farmers’ Markets

CSA’sCSA’s Supply & Distribution

The Making Local Food Work programme

In-direct investment via intermediary organisations: the example of Making Local Food Work

Social Capital

Human Capital

Physical Capital

NaturalCapital

Investment:

Grant from Big Lottery

Reshapedfood operations

Reshapedfood services

FinancialCapital

Plunket: community retail

Making Local Food WorkProgramme

SUSTAIN Food co-ops

SUSTAIN Food hubs

Soil Association: CSA

Co-ops UK: Governance

Soil Association: Buying groups

FARMA: Farmers’ Markets

Country Markets: Country Markets

CPRE: Food Webs

Other infrastructure support models

Locality• 423 members in England• Combined income of £325 million - £172

million earned income• £660 million assets• 5,500 staff• 20,000 volunteers

Land & natural resources

Buildings & equipment

Grant Finance

People

Local communities& ConsumersCitizens

Primary production Processing Distribution RetailProjects

& Services Social enterprise activity

Trading income

People

AONB TeamIn

Local authorityTRUST

Land & natural resourcesBuildings & equipment

Grant Finance

People

Primary production Processing Distribution Retail

Local communitiesConsumersCitizens

Loan Finance Equity Finance

Investors

Projects&

Services Social enterprise activity

Some conclusions

• Trusts can be established as core asset holding vehicle

• Can carry out primary purpose trading• Can establish trading subsidiary• Can lease assets to small businesses, coops or

social economy organisations• Can explore joint ventures or partnerships, e.g.

with a Community Benefit Society that engages the local community as investors, consumers and volunteers

Contact:

Tim Crabtreetim.crabtree@wessexca.co.uk

www.wessexca.co.uk