A to Z Enterprise Fact File

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Here are some topics that you may want to know more about including what they mean and where to find further information. There are links to external websites and to other sections within this website.

If there is something that is not here that you want to know more about contact us.

Accounting

Accounting means to put together bookkeeping systems to produce financial statements. An accountant needs to understand your organisational needs. Accountants can also offer other services: payroll systems, bookkeeping, tax issues and management accounts.

Find an accountant, either by recommendations or contacting your local CVS

Community Accounting Plus Tel 0115 947 0839

Association of Chartered Certified Accountants Tel 0141 582 2000

Institute of Chartered Accountants Tel 020 7920 8100

Accounting packages that may be suitable include Sage, QuickBooks, or Pegasus

Added Value

Economics term referring to the diverse social, community, commercial or financial benefit which third sector organisations deliver (links in with social auditing).

 

 

Aims

The aims are the ultimate purpose of an activity or organisation, often there will be just one, however is it possible to work towards two destinations at the same time? Some people like to distinguish between long-term and short- term aims.

 

 

Annual General Meeting

Under the Companies Act a company may if it wishes to hold a meeting in each calendar year to which all members or shareholders are invited. It is usual for all third sector organisations to hold such a meeting to deal with matters including the adoption of the previous year’s financial statements, rotation of directors and the appointment of auditors.

 

 

Asset-Based Development

This is the planning and implementation of projects that own or have long term leases for building or land based assets that are run for the benefit of the community based and that seek to achieve self-sufficiency, independence and sustainability through income generation related to that asset. For help and advice contact Locality Tel 0845 458 8336.

 

 

Assets

There are two types of assets - fixed and current.

Fixed assets are anything owned by the organisation that has commercial or exchange value, e.g. buildings, shares, equipment.

Current assets are items that can be turned into cash quickly such as: stock, cash, money owed by debtors.

 

 

Awards

The benefits of applying for awards can sometimes cover volunteer motivation, free advertising and increased funding. Organisations whose programmes offer awards to social enterprises are:

Social Enterprise Awards - from the Social Enterprise UK for best social and community enterprises, Tel 020 7793 2319.

See also Entrepreneur

 

 

Banking

You can either have a business account at one of the main banks or alternatively use a bank that works with organisations that specialise in ‘not for profit’ organisations and charities. Check to see who is offering free banking.

Social Banks:
The Charity Bank Limited  Tel 01732 774040
Unity Trust Bank  Tel 0121631 2743
Tridos Bank  Tel 0117 973 9339
Street UK Tel 0121 230 1060
The Cooperative Bank  Tel 08457 215 215

 

 

Business Angels

Private venture capitalists provide money and experience to early stage, high-risk investments. The name was originally given to those ‘angels’ who were prepared to help the theatrical profession by investing in new productions.

 

 

Business Information Sites (generic)

Gov.uk/business Tel 0845 058 6644

Enterprise Quest – business tips and ideas. Also offer fact sheets on a selection of business ideas which you can buy individually for a few pounds. They give a clear breakdown of everything you should be looking at for your new business idea. Tel 0191 461 8000.

Cobweb Information for Business – Business tips, ideas and fact sheets. Tel 0191 461 800.

 

 

Business Names

If you are going to incorporate your organisation you will have to register your business name at Companies House, and carry out a search on their website to make sure no one else has the same name. There are restrictions on the usage of some sensitive words such as: ‘Royal’ or Institute’. Further details can be found on Companies House website, Tel 0870 33 33 636.

It is a good idea to check the name is also available as a web address (domain name) and register with organisations such as:

Easyspace
Low Cost Names 
123reg

 

 

Business Planning

Describes in detail the objectives of a business, and the necessary steps to achieve them. You will find an example business plan in the resources.

For organisations that can help with business planning see the Directory section

 

 

Cashflow Forecasting

A projection of expected income and expenditure over a period of time.

 

 

Charities

Charities can trade under certain circumstances. See Charities and trading.

Charity Commission Tel 0845 3000 218

 

 

Community Business

An organisation which is set up, owned and controlled by the local community and which aims to create jobs for local people and focus on local development. They have a strong geographical definition and focus on local markets and local services.

 

 

Community Consultation

Assessing the community’s needs and support for any new social enterprise venture is vital. By consulting the community and undertaking a marketing plan it will give your organisation a better chance of survival.

 

 

Community Interest Companies

A new type of legal structure specially designed for social enterprises. They are limited companies with special additional features created for the use of people who want to conduct a business or other activity for community benefit, and not purely for private advantage. This is achieved by a community interest test and asset lock, which ensures that the CIC is established for community purposes and the assets and profits are dedicated to these purposes.

Registration of a company as a CIC has to be approved by the Regulator who also has a continuing monitoring and enforcement role. Contact Office of the Regulator of Community Interest Companies Tel 029 203 46228

 

 

Community Land Trusts

CLTs are established in communities to acquire fixed assets and then hold them in perpetuity for local use. They work on a non-profit basis, raising money from new sources and unlocking other resources, to provide and manage housing, workspace, community buildings and green spaces (including allotments). See Community Land Trusts.

 

 

Company Limited by Guarantee

This is a commonly used legal form for social enterprises and not-for-profit organisations as it is easy and cheap to set up, with an understandable format. As an alternative to buying shares, members provide a guarantee of a pre-determined amount should it be needed when the company is wound up. This amount may be as little as £1. To find out more contact Companies House Tel 029 203 46228.

 

 

Company Limited by Shares

A company formed under the company’s act that is controlled by its shareholders. Normally community owned with one share one vote and not able to benefit financially. Companies House Tel 029 203 46228

 

 

Constitutions

If you are starting an enterprise you may want to review and revise your existing constitution and potentially set up a new structure. See structure.

 

 

Cooperatives

A cooperative is defined as "An autonomous association of persons united voluntarily to meet their common economic, social, and cultural needs and aspirations through a jointly-owned and democratically-controlled enterprise".

Cooperatives are classed as social enterprises. They work to specific values and principles, and examples include workers’ cooperatives, consumer and producer coops, cooperative partnerships and cooperative consortia.

Co-operatives UK Tel 0161 246 2900.

 

 

Customers

A customer is a purchaser, a consumer, a user, or possibly an indirect beneficiary of the products and services produced by an organisation. Customers can be individuals, groups or organisations (such as commercial companies, public sector bodies, or other social enterprises, community groups or charities).

An individual or organisation does not necessarily have to pay for the goods or services to be regarded as such, their needs and expectations should be understood and met. A social enterprise must, by definition, have some paying customers who pay for the goods and services they receive.

For more information see Gov.uk on customers and Institute of Customer Service Tel 01206 571716

 

 

Data Protection

If you are holding details of customers/clients/volunteers you must adhere to the Data Protection Act, which aims to promote high standards in the handling of personal information, and to protect the individuals’ rights. For help and advice contact Information Commissioner Tel 01625 545 745

 

 

Development Trusts

Development trusts are enterprises created by communities to bring wealth and improvements to their area. For examples contact Locality  Tel 0845 458 8337

 

 

Employment

Employing staff? For help with employment rules and regulations contact ACAS Tel 08457 47 47 47.

The BIS have free publications with information on employment rules and regulations - Tel 9845 015 0010.

Home Office - How to check someone is entitled to work in the UK. Tel 0845 010 6677

Help with finding the right person for your organisation contact Job Centre Plus Tel 0845 601 2001

Gov.uk Tel 0845 058 6644

 

 

Entrepreneur

A social entrepreneur sees strength and resource in communities and acts on opportunities to activate these qualities.

Organisations that support social entrepreneurs:
School for Social Entrepreneurs 
Foundation for Social Entrepreneurs UNLtd

 

 

Factoring

Factoring or ‘invoice discounting’ is a way of collecting payment of part on an invoice’s amount more quickly than the usual 30-90 days. It is useful when an organisation experiences frequent delays in payments.

For a fee a financial concern will provide a portion of the invoice amount in advance, and receives payment when the invoice are due and give the organisation the balance of what is owned to them. Contact your local bank for advice, or for case studies on how factoring can help improve cash flow: Decision Finance.

 

 

Feasibility Study

Feasibility studies are needed to provide an over view of the main issues relating to your business idea. The purpose is to identify any ‘make or break’ issues that would prevent your business from being successful in the market place. A feasibility study determines whether the business idea makes sense and will be achievable.

 

 

Finance

Your enterprise will probably need initial and potentially ongoing finance. This may be achieved through:

  • Grants
  • Loans
  • Equity income (shares)
  • Mix grant and loan
  • Venture capital
  • Joint ventures

 

 

Food

Organisations who offer help and advice for food projects are:

F3 – a consultancy enabling local and sustainable food initiatives (a co-operative) Tel 0845 458 9525

SAUSE is a website that has been compiled as a result of research carried out for community food farming, by SUSTAIN. It offers a ‘Toolkit for Community Food Products’ - Tel 020 7837 1228.

Making Local Food Work – an initiative managed by the Plunkett Foundation with the objective to 'reconnect people and land through local food increasing access to fresh, healthy, local food with clear, traceable origins'.

Rural Community Shops (formerly ViRSA – the Village Retail Services Association) – now a project of the Plunkett Foundation, this supports rural communities wanting to set up and run a community-owned shop. It provides practical assistance, a network of community retail advisers, a national office and various publications.

 

 

Franchising

Franchising offers franchisees the advantage of starting up a new business quickly based on a proven trademark and formula of doing business, as opposed to having to build a new business and brand from scratch. You can buy a licence from an existing organisation (the franchisor) and use their trade name, products, services, systems, promotions, training etc.

Community Action Network is a leading organisation for social franchising - Tel 0845 456 2537

Social Firms UK is another organisation that deals with social enterprise franchising - Tel 01737 764021

 

 

Governance

The legal structure of an organisation. This also relates to procedures for governing the organisation and conformance to the memorandum and Articles of Association, plus legality of practices.

 

 

Grants

Grants are given to help an organisation to meet its aims, which could be for a variety of things such as start up, training, or a new project. It is not free money; it will need to be accounted for. The majority of organisations who give grants will have their own guidelines on applying and monitoring the grant that has been offered to you.

If your funding body is not happy with the way in which you have used the grant, in the times allocated, they can ask for it back (clawback). You need to read your conditions carefully to make sure you can achieve your outputs and reach your goals.

Grant funding sources include:
biglotteryfund.org.uk - this site covers Big Lottery Fund's current grant making programmes.
governmentfunding.org.uk - this is a portal for government grants from a variety of departments. You can sign up for email alerts.
j4bgrants.co.uk - aimed at voluntary groups and small firms, personal email alerts are included on completion of free registration process.
fundinginformation.org - Profunder is a site offering a choice of two funding programmes for small or large projects. Subscription charges apply.

 

 

Health and Safety

The Health & Safety Executive can answer all your questions relating to health & Safety in the workplace - Tel 0845 345 0055.

You can also find publication on health-and safety matters on www.hsebooks.co.uk  Tel 01787 881165.

 

 

ILM (Intermediate Labour Market)

These provide training and work experience within the supportive structure of a community business. The work experience is often a year in length and a stepping-stone to employment and can be managed as a social enterprise or a private company.

 

 

Incorporated

When you register your social enterprise as an incorporated organisation, either by registering with Companies House or as an IPS society, it becomes a legal entity. This shifts liability and confers various rules and requirements on the organisation.

 

 

Industrial and Provident Society

There are two types of I&PS; a bona-fide co-operative and a society for the benefit of the community.

Co-operative I&PS is a corporate form used by a broad range of enterprises, it will use and observe the international co-operative principles. They will be governed by their ‘Rules’ not a Memorandum and Articles of Association as in company law.

An I&PS Community Benefit Society is a democratic not-for-profit organisation but their primary objective is to serve the broader community, not just membership, it is also governed by its ‘Rules’.

I&PS are governed by the FCA - Financial Conduct Authority Tel 020 7066 1000

 

 

Insurance

Compulsory insurance types are: Employers’ liability insurance; Motor insurance. Depending on your type of business your organisation may need other specialised types of insurance.

There are other areas of risk for which insurance cover is wise: Building Insurance; Contents Insurance; Business Equipment; Public Liability and Professional Indemnity.

For more help contact:

Association of British Insurers (ABI) Tel 020 7216 7546.

British Insurance Brokers’ Association Tel 0870 950 1790.

 

 

Internet Marketing

Social Firms UK have produced a guide ‘Internet Marketing For Social Enterprises’ available for free download.

 

 

Leasing

You may want to lease premises or equipment for your organisation. You could weigh up the pros and cons of leasing as opposed to buying. It may be advisable to read the small print or get advice from your solicitor or bank manager before you sign up to some more complex leases, such as premises.

For finance leasing contact: Finance & Leasing Association  Tel 020 7836 6511

 

 

Legal Help

Setting up a Business gives organisations information and searches for local solicitors.

You can apply to ProHelp for specific free professional advice for one particular need. For legal help contact the Law Society Tel 020 7405 9075.

 

 

Legal Structures

You may want to set up a new legal structure for your enterprise. There are many options. You must first decide what you are going to do and the structure will follow.

Charity Commission Tel 0845 300 0218
Community Interest companies CIC Regulator Tel 029 203 46228.
Co-operatives Co-operative East Midlands or Co-operatives UK’s Tel 0161 246 2900.

Books and fact sheets to help are:

Choosing a legal structure for your social enterprise from Enterprise Solutions Northamptonshire
'Start your Social Enterprise’ from the Social Enterprise Coalition has a section on deciding your legal structure Tel 020 7793 2323.
'Organisational Structures for Rural Social Enterprises' from Bates, Wells and Braithwaite Tel 020 7551 7777.

 

 

Licences

Depending on your organisation you may need certain licences e.g. music, entertainment. To check if you need a licence for your activities the Gov.uk website offers an online check, which will let you know what licence you may need - Tel 0845 058 6644

 

 

Loans

A loan is when you borrow money with certain terms and conditions for its repayment. A loan can offer you more financial flexibility than a grant, as you have fewer restrictions on its usage.

 

 

Magazines

New Start  Tel 0161 236 7036

Regeneration and Renewal  Tel 020 8267 4381

Pioneers Post Tel 020 8533 8890

Third Sector

 

 

Market Research

This can provide the evidence you need to prove that your product/service will sell (or not) at that particular time and price. It’s about researching and understanding the product and customer.

For help locally with your marketing plan contact your local Gov.uk and speak to a business advisor.

 

 

Marketing

An effective way for your organisation to grow is to focus on its marketing efforts. This means understanding how to get your product or service to the right customer at the right price and at the right time, and also how to keep your customer.

For training books and information on qualifications in marketing contact: CIM - The Chartered Institute of Marketing  Tel 01628 427120.

 

 

Membership Organisations

Social Enterprises can become members of organisations, which can offer a variety of benefits from trading opportunities to help and advice.

Community Action Network - CAN  Tel 020 7250 8047

Co-operatives UK  Tel 0161 246290

Social Enterprise East Midlands (SEEM)  Tel 0115 900 3299

 

 

Memorandum and Articles of Association

A company’s constitution is contained in two documents 'The Memorandum of Association' which contains the objects and powers and 'The Articles of Association' which sets out the internal management structure and procedures.

You are advised to take legal advice as a safety precaution.

For a variety of M&AA examples relating to the different types of incorporation for social enterprises contact: Community Interest Companies Regulator Tel 029 2034 6228.

 

 

Mission Statement

An organisations stated reason for being, its purpose. An effective mission statement may be encouraging, realistic and straight to the point.

 

 

Mutuals

These are organisations that band together with the common purpose of providing a shared service from which they all benefit, e.g. Credit Unions, Co-operatives, building societies, employee-owned businesses.

 

 

Not for Profit (or not profit distributing)

This refers to organisations, which may well make a profit, but do not distribute their profits to shareholders and instead use the profit/surplus for social or community benefit, or reinvest in fulfilling their social aims.

 

 

Objectives

Specific and measurable levels of achievement, laid down in the aims and objectives of the organisation to achieve its goals.

 

 

Personalisation

Personalisation covers a range of self-directed care arrangements including personal budgets.  ACEVO has a number of very useful guides on Personalisation and how best to provide services that people can purchase using self-directed payments

 

 

Procurement

Procurement refers to the overall process of acquiring or selling a product or service.

Depending on the circumstances, it may include some of all of the following: identifying a need, specifying the requirements to fulfil the need, identifying potential suppliers, soliciting bids and proposals, evaluating bids and proposals, awarding contracts or purchase orders, tracking progress and ensuring compliance, taking delivery, inspecting and inventorying the deliverable, and paying the supplier.

Social Enterprise Coalition – offers guidance with procurement for the NHS Tel 020 7793 2326.

NCVO Public Services – information and resources for those working in and with the voluntary and community sector on public services.

Public Procurement ‘A Toolkit for Social Enterprises’.

 

 

Property

Securing a property could be the best way of finding the correct premises for you’re organisation.

The advantages of buying are:

  • you would have fixed overheads
  • the value of the building could increase
  • you may have the opportunity of renting out to increase your revenue.

The disadvantages could be:

  • it’s not so easy to fold up the organisation
  • you have to budget for the upkeep and security.

You also have to abide by the Disability Discrimination Act 1995 to make your building accessible for customers and staff. Don’t forget you will need professional input. To find a registered surveyor contact Royal Institution of Chartered Surveyors  Tel 0870 333 1600

 

 

Regulations

To find out what type of regulations your particular organisation needs to trade, you can fill a simple checklist on the Gov.uk website. It will produce a personalised list for your organisation.

 

 

Rural Enterprise

Organisations who deal with rural social enterprise:
ACRE Tel 01285 653477
Plunkett Foundation Tel 01993 810730

 

 

Service Level Agreements

An agreement typically between a contract holder and a potential supplier, which lays out the conditions and levels of service to be met by the tendering body in fulfilling a contract.

 

 

Social Audit

Social auditing is a way of measuring the added value of your organisation (or triple bottom line). It’s how an organisations social, environmental and ethical performance is monitored.

For further information:

Social Audit Network  Tel 01 392 666281

Social Enterprise East Midlands  Tel 0115 845 6434

 

 

Social Capital

Social capital can enhance the economy by investing in the skills and knowledge of volunteers as human capital to benefit the local community.

 

 

Social Economy

The Third Sector is made of organisations such as charities, social enterprises and the voluntary and community sector, who engage in the sale of their voluntary work, goods and services. The Third Sector is one of the largest growing sectors, which is currently improving the economy.

 

 

Social Firms

A Social Firm is a business set up specifically to create employment for disabled people. It has three core values around Enterprise, Employment, and Empowerment. For more information contact Social Firms UK  Tel 01332 814404 for East Midlands.

 

 

Solicitors

Speak to other social enterprises for recommendations of local solicitors, or contact the Law Society, who will help you find a solicitor.

Bates Wells & Braithwaite is a company in London that has specialist knowledge of social enterprise. There website has a variety information which may answer some of your questions relating to social enterprise - Tel 020 7551 7777.

 

 

Sport

Sport organisations can be social enterprises and can be made financially sustainable and socially inclusive.

Sport England  Tel 08458 508 508

Sports & Recreation Trusts Assoication (SpoRTA)  Tel 020 8317 5000.

 

 

Stakeholders

One who has a share or interest in an enterprise. All organisations will have stakeholders, they may include: partners, local and non-local community, community workers, direct customers, clients, service users, beneficiaries, board or management groups, finance or grant providers, shareholders, and employees.

 

 

Support Organisations

Listed below are some of the organisations that offer help to social enterprises.

Gov.uk Tel 0845 058 6644
Local Infrastructure Organisations - Directory of East Midlands LIOs
Locality Tel 0845 458 8336
New Economics Foundation
School for Social Entrepreneurs (SSE) Tel 01623 600 650
SEEM (Social Enterprise East Midlands) Tel 0115 845 6434
Plunkett Foundation 01993 814377
Social Enterprise Coalition Tel 020 7793 2323
ProHelp (free professional help) Tel 0870 600 2482

 

 

Surplus

The profit in many social enterprises is referred to as surplus, to reflect their ‘not for profit’ status.

 

 

Sustainability

Ensuring that an organisation can make sufficient revenue to be financially viable, and having the staff and volunteers to support this, also the resources to do so.

 

 

Tax

For all your tax and vat enquiries contact HM Revenue & Customs  Tel 0845 010 9000.

 

 

Tendering

The following have details of tenders:

Contracts from East Midlands Local Authorities

Official journal of European Communities

Government contracts typically worth less than £100.000

 

 

Third Sector

A term used to describe those organisations, which are not part of either the private or the public sectors including voluntary and community organisations, charities, social enterprises, development trusts, community enterprises and cooperatives.

 

 

Trading Arms of Charities

Some charities establish trading arms, in pursuit of their aims. They are incorporated business, run by directors and with the same social aims as the charity. Their purpose is to trade and pass over their profits/surplus to their charity. See Resources section. (link to Charities and Trading)

 

 

Training for Social Enterprises

Training offered locally may or may not be accredited you might find some advertised in newsletters and on support organisations websites. Make sure theses agencies are aware of you, and have your details.

On going training available:
School for Social Entrepreneurs Tel 115 875 8828

University Courses:
University of Northampton BA and MA
Judge Business School, University of Cambridge

 

 

Triple Bottom Line

Measurements of an enterprise’s impact taking social, environmental and financial factors into accounts.

 

 

TUPE

Transfer of protected rights. This is relevant for any organisation that employs people and then sets up a different structure or one that takes on employees from a different organisation. In this instance, the employees must be offered and given the same conditions of employment as those that they previously enjoyed. The process can be quite complex if there are, for example, pension rights involved. It is always best to seek advice.

 

 

Unincorporated

An informal group, which has no legal structure and is governed by its own rules.

 

 

VAT

Valued added tax (VAT) is a tax on sales of goods and services. Take advice on registering if your income is more than £68.000 a year (2009) or you can take the option take advice and registering voluntarily. HM Revenue and Customs  Tel 0845 010 90000.

 

 

Venture Capital

Funds provided by for instance a bank, building society or specialised lending institution to an organisation/individual to start up or develop a business or company where a high degree of risk maybe involved.

For more information and details of funding for social enterprises contact:
The Adventure Capital Fund  Tel 020 748 83455.
Bridges Ventures  Tel 020 7262 5566.

 

 

Venture Philanthropy

The use by grant-makers and investors of certain principles traditionally associated with venture capitalists to either build the capacity of a non-profit organisation or to invest in a social purpose business venture. Key elements include long-term relationships, development of business plans, provision of cash and expertise, and an exit strategy.

 

 

Visiting Other Enterprises

If you are thinking of setting up a social enterprise or expanding an existing enterprise, or moving into contracting or developing a trading activity alongside your organisation’s existing activities, you may find it helpful to visit an organisation which has already done something similar. Funding may be available to both you and the host organisation you choose to visit to help you cover the costs of your visit.

Organisations offering funding for a visit

Locality – Tel 0845 458 8336.

 

 

Winding Up

If an organisation is winding up for whatever reason the Memorandums and Articles of Association have to be read, and abided to according to the guidelines set down when the document was written. This usually means the assets are given to a group or organisation with similar social objectives. Also you must inform either Companies House or the Industrial and Provident Society which ever you are registered under.

 

 

Youth Enterprise

Organisations who specialise in helping young people in business are:

The Princes Trust - which help people between the ages of 14 and 30 years. Contact to find an advisor in your area.  Tel 0800 842 842.

Shell LiveWire offer advice and support for entrepreneurs aged less than 30 years.  Tel 0845 757 3252.