Case study: First Fruit Warehousing

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Social Enterprise

• Case study First Fruit Warehousing
• A view from the front line
• Clare Sharpen
• Greater London Enterprise

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The Warehouse

• 500k turnover, 3 yrs in operation
• Subsidiary of local charity First Fruit
• In partnership with Green-Works

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The Operation

• Recycling, storage and re-sale of used office
  furniture
• 30,000 sq ft
• 4 lorries per day
• Multiple sources of income
• A self-sustaining, independent business

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The Staff

• 4 local skilled staff
• 6 8 warehouse operatives from homeless
  backgrounds, unemployment or refugees.
• Recruitment through hostels / local contacts
• 6 12 month work placements

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Training

• Forklift truck licence, First Aid, Health
  Safety at work.
• Basic principles of the working world
• Support into
• further employment

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Some issues weve faced

• Local context
• Identity as a social enterprise
• Money, money, money
• Partnership
• Business

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Local context Canning Town

• The challenge of historical deprivation
• Generational worklessness
• Low level of skills
• Unwilling to travel far for employment
• No bank accounts for wages
• Poor transport links

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Local context Canning Town

• The challenge of future prosperity
• The role of industry/enterprise in regenerated
  areas
• Prohibitive increased cost of land
• Sustainability
• Involvement in local priorities

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Local input

• Creation of real jobs for local people
• Generating and keeping income locally
• Provision of low cost furniture for local
  schools, businesses, charities etc
• Building local networks partnerships

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Identity as a social enterprise

• Our identity purpose as an enterprise
• Charity Vs Business
• Others perceptions and expectations
• Raising local profile

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Identity as a social enterprise

• Tips
• Be clear on what it is, and is not
• Decide on the key messages
• Earn a good reputation
• Professionalism

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Money, money, money

• The warehouse had
• Start-up capital from partner umbrella
  charity, rent deferral
• Charity rates (80 saving)
• Limited funding for staff salaries
• No bank loans or other financial support

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Money, money, money

• Tips
• Banks dont recognise social enterprise but
  being part of a charity can reduce charges
• Bank loans would require a robust business case
  with sound financial planning

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Money, money, money

• A social enterprise is for profit
• making a profit is a good thing!
• The profit distribution and re-investment defines
  the social enterprise.

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Partnership

• Partnership pros and cons
• Understanding each others priorities
• Questions of identity and marketing
• Riding out the storms

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Partnership

• Tips
• Relevant Service Level Agreements ensure clarity
  of mutual expectations
• Using eachothers contacts
• Interdependence mutual benefits

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Business

• Balancing social with enterprise
• Customer perceptions expectations
• Employing the right core staff
• Coping with low skilled employees
• Other factors e.g. Health Safety

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Business

• Tips
• A social enterprise is a competitor to other
  local businesses
• Staff should have the relevant skills
• Recruitment of staff from business into social
  enterprise should be promoted

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Transferability

• Identify the local need (eg employment)
• Identify an appropriate viable business
• Locate suitable premises
• Ensure appropriate legal structure
• Use networks and contacts

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What its worth

• Satisfaction of being independent and
  self-sustaining
• Meeting the social ends through business
  means
• Giving chances not charity

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Sources of information

• Networks contacts
• Social Enterprise London www.sel.org.uk
• Social Enterprise Coalition annual conference
  www.socialenterprise.org.uk
• Local business support organisations
• DTI Small Business Service www.sbs.gov.uk

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Recommended reading

• Black L Nicholls J (2004) Theres No Business
  Like Social Business (available through
  www.the-cats-pyjamas.com)
• Pearce J (2003) Social Enterprise in Anytown
• Leadbeater C (1997) The Rise of the Social
  Entrepreneur
• Social Enterprise London reading list
  www.sel.org.uk