Social entrepreneurship & DropShipping: Do good with DropShipping

Have you ever thought it would be great to build a business that did good for others, while still earning enough money to make you a living? Well, that is indeed a distinct possibility – and there are an increasing number of individuals that are looking to achieve the exact same thing. The term social entrepreneurship refers to exactly that – creating a business that can do good for others, at the same time as building an income for the employees of the business. There are so many ways to build a great business that benefits others – almost any business can run to donate funds, time and awareness for charities or social causes, after all.

What is social entrepreneurship?

Social entrepreneurship is a complex thing, in that it applies to many different types of organisations – but essentially, social entrepreneurship is basically doing business for philanthropic reasons. Most social enterprises are traditional businesses in that they still need to be growing profits (which may be donated, or used for further endeavours) but they aim to use their influence to help shine a light on the issues, or the particular cause that they are supporting.

These are the main types of social enterprise – although there may be overlap for some businesses.

Cooperative

This is a business that allows people, or other businesses – either outside the organisation, or their employees – to join as members, and helps to meets their social, economic, or cultural needs and requirements. The most famous examples in the UK are the John Lewis Partnership, which is an employee cooperative, and The Co-op, which is not only an employee cooperative, but has a strong ethical stance, campaigning for initiatives that can benefit local communities, and customers throughout the UK.

Social firms

This type of social enterprise works by helping people that may be disadvantaged, or need a bit more support to enter employment. Examples of the type of employees that might be brought on board include people who have disabilities and may need flexible working to accommodate that, or that are in another marginalised group such as refugees, or are convicted offenders that have completed their sentence.

Socially responsible company

This type of company takes every step that they can to be socially responsible, as well as having a social mission. Many environmental companies take this approach – sourcing sustainable materials for their products, and knowing the actions of their entire supply chain. IKEA is an example of a socially responsible company – not only do they source from sustainable sources, but they also support local communities, their workers and engage in charitable work. There is much more about their initiatives here.

For-profit with a social impact

This type of business is a traditional business, that uses profits and influence to support social causes. An example of this might be a coffee shop that only uses Fairtrade products, and sources their food from a social firm, but it could also be a retailer that acts in a similar way.

Why create a social enterprise?

Many people that are thinking about creating a social enterprise do so because they have become disillusioned with their work – maybe they feel that their 9-5 is only benefitting shareholders, and that they could be filing their time in a much more meaningful way. And really, why wouldn’t you want to feel good about the fact that the work you’re doing is doing great things, rather than simply earning money?

Although social enterprises might seem as though they might be more difficult to create profits and to be successful, actually, there are many ways that social enterprises have an advantage over traditional businesses.

To create meaning in the work

As we’ve just said, sometimes it can be really tough to be motivated if you’re showing up and are helping to make money for other people, for a small wage. But when you’re passionate about the work – and the reason that you’re working is more than just to be able to earn a wage – then yourself, and your employees, are much more likely to show up, and give their best, day in, day out.

If the thing that really helps you to get out of bed in the morning is to contribute to causes and social issues like fighting racism, gender inequality, and human right issues, then it is a pretty safe bet that there are other people who feel the same way.

To create social change

If you’re creating a social enterprise, you’re doing so in order to do good things – because there are people, animals, and the planet that have issues that need tackling. Customers want to be able to do better when they’re making a purchase, and support the causes that mean a lot to them. You’ll need to be completely open about the altruistic actions your business takes, and be willing to talk to your customers about your work – but this will build relationships, a bigger customer base, and encourage your customers to become advocates of your business too.

To draw attention to the issue

Being able to talk about the incredible work that you do supporting social causes means that you will almost certainly see more press requests. People love to learn about businesses they know they can feel good shopping from – look at the Toms brand as an example. Toms founder Blake Mycoskie says:

“Our customers get excited to be a part of what we’re doing. If you ask anyone wearing Toms how they first heard about us, most won’t mention an advertisement; they’ll say a friend told them our story.”

Where, exactly did the friend find out about the Toms story? From the media, and searching for more information, of course. Anyone who knows anything about Toms now knows that they started off by donating a pair to a person in need for every pair that a customer bought – their ‘one-for-one’ strategy might have changed, but customers know the company does good things.

To form strategic brand partnerships

Great partnerships are at the heart of most successful businesses – we’ve forged some incredible NAMEpartnerships for Avasam, to help our users to create even better businesses for themselves! For social enterprises, there are so many opportunities to create those partnerships, whether they’re with local, national, or global charities, other for-profit companies that have similar goals.

These strategic brand partnerships will take different forms, but may include raising awareness, sharing information, supporting the same charities, and ultimately, to further build the profits in order to do more great work.

Support is readily available

There are so many initiatives that social enterprises can benefit from in order to do more. There are opportunities to secure funding – even as a start-up – and there are loads of links here to help you get started too.

The great thing about starting a business now of course, is that it is easier than ever to get started. If you have a laptop or PC, you can find almost all the software and resources you need for free – there are hundreds of open source software alternatives, social media is free to use, and so on.

Who can become a social entrepreneur?

In theory, almost anyone who puts their mind to it can become a social entrepreneur – but there are a few qualities that most people who become social entrepreneurs have.

The biggest requirement for becoming a social entrepreneur really though, is passion – if you’re likely to lose interest quickly, your social enterprise won’t be the success you’re dreaming of.

Famous social enterprise: Toms

Toms is one of the best-known social enterprises of recent times, and pushed the one-for-one model to the forefront of people’s minds. The idea when the company was launched, was that for every pair of shoes sold, another pair would be donated to a child who needed a pair. Since the company launched in 2006, there have been more than 100 million pairs of shoes donated, and the company has grown to encompass eyewear, and increasing access to sustainable water systems. They’ve changed their model now, and they now donate $1 for every $3 made to charitable organisations.

What is DropShipping?

DropShipping is a retail fulfilment process where, when a customer buys a product from an online store, the store then purchases the item from a supplier, and the supplier sends the item directly to the customer. The store never sees the product and does not hold stock – they simply deal with listing the product on their website or marketplace channel (e.g. eBay or Amazon) and customer service issues.

DropShipping is a great way for businesses to increase and diversify their inventory, without the associated risk of investing in stock, or needing additional resources such as a warehouse or warehouse staff.

Why use DropShipping as a social enterprise?

With DropShipping, since there is relatively little initial outlay required, you won’t need to put cash in up front to start building your business, and if you’re using your social enterprise business as an extra to your day job (as a side hustle!) then with the right technology you’ll be able to automate a lot of it.

How can you do good with DropShipping?

Well, the simplest solution is that you can be DropShipping and donating money to charity – either as a percentage of each sale, of your earnings each month, or each year. But that isn’t the only way you can do great things with DropShipping!

For those of us that are passionate about the environment, then sourcing and selling sustainable products is a great place to start growing a social enterprise business. When you think about it, if you can sell products that customers want, and they are a sustainable alternative to conventional items – that is MUCH better for the environment. You can be making profits to pay yourself a salary, and then decide, using your business proposal and analyses, whether to use the extra profits on top of that to grow your business, or to donate to environmental charities. In addition to this, linking up with charities and non-profit organisations, you may be able to use your social media, and your sales to create greater awareness of the issues.

As an example, if we were starting a DropShipping business that was to support the environment today, we’d start by sourcing sustainable packaging, as well as compostable food containers, eco-friendly products made from bamboo, and products that help build a more environmentally friendly lifestyle. With these products, we’d set up a store using our offer from BigCommerce, build our social media following with great content about the environment, and go from there.

This method can be applied to other types of social enterprises too – think about the original Toms shoes model, which gave one pair to someone in need, every time someone bought a pair. With DropShipping, margins are unlikely to be able to hit this sort of level, but there is potential. Let’s say your social enterprise is focused on children in poverty – maybe for every 10 purchases – either of a certain line, or overall – you can donate a product to a charitable organisation supporting children, or maybe an education charity. The same could be applied to pet products and working with animal welfare charities, or lingerie, makeup and fashion might provide products to, and draw attention to organisations that work with survivors of domestic abuse. The key here, being that people are more inclined to buy from businesses that allow them to feel good about their purchase, especially if they are buying items that they’d be buying anyway.