Social business enterprise

Social business enterprise

Social business enterprise is an economic concept innovated by Nobel Laureate Professor Muhammad Yunus whose business is designed to meet a social goal. Yunus termed Social Business Enterprise (SBE) as 'social benefit maximizing kind businesses that are created to do good to people, not paying any attention to making personal gain'. [ [http://www.nextbillion.net/newsroom/2008/02/15/muhammad-yunus-on-social-business Muhammad Yunus on Social Business Enterprisxe] ]

Features and goals

SBE is featured to be as follows :

* To be designed and operated to pass on all the benefits to the consumers.
* To be operated without incurring losses.
* To be operated competing with Profit Maximizing Enterprises (PMEs).

Profit making by an SBE shall be consistent and desirable because:

* To generate enough surplus to pay back the invested capital to the investors as early as possible.
* To generate surplus for — (i) Expansion, (ii) Improvement of quality, (iii) Increasing efficiency through introducing new technology, (iii) Innovative marketing to reach the deeper layers of low-income people and disadvantaged communities and (v) Undertake research and experimentation to improve and diversify products and services.

Example : Grameen Danone

Grameen Danone is the first project implemented as a joint venture between Grameen Trust and the Danone Groupe. As many as fifty dairy plants will be established udner this project. The first plant was inaugurated on 7th November 07 by French football icon Zinedine Zidane. It is a small plant on only 7,000 sq. ft. area cost of which is USD 1.00 million approximately. Its production capacity is 3,000 kgs yogurt per day and maximum 10.000 kgs. Currently it produces yogurt for the children which is also suitable for the adults. Yogurt is manufactured from fresh milk and also includes cornstarch, date molasses, sugar and micro nutrients (vitamin, iron. protein, iodine, zinc, calcium, etc. The product is branded “SHOKTI DOI”, meaning 'energy yogurt’. A single 80-gram cup provides 30 percent of a child’s daily requirements of vitamin, iron, zinc and iodine. The cost of production is approximately 5 cents (USD) per cup which is sold for Taka 7 only. Rural women as well as tiny shops in rural areas are engaged in product selling process. In order to procure milk from local sources, the project is actively considering developing about 500 mini dairy farms with 3-5 cows each. Such farms will be supported with micro credit by Grameen Companies and the Grameen Bank. [ [http://www.adbi.org/conf-seminar-papers/2007/07/03/2311.microfinance Grameen Danone Foods Limited : A Unique Model of Social Business Enterprise] ]

External links

* [http://www.catfund.com Catalyst Fund Management and Research]
* [http://www.socialinvestments.com Socialinvestments.com]

References


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