MBA IN COMMUNITY ECONOMIC DEVELOPMENT
BUSS & COMMUNITY DEVELOPMENT II
Analysis of Community-Based Enterprise
Contents Introduction 2 1.0 Definitions and background of Community-Based Enterprise (CBE) 3 2.0 The Success and Failure of Community-Based Enterprise 4 2.1 The relationship between Social Economy and Community-Based Enterprise 5 2.2 The Major Characteristics of Successful Community-Based Enterprise 6 2.21 Successful CBEs focus on local community skills 7 2.2.2 Successful CBEs focus on distributing profit to the local community 8 2.2.3 Successful CBEs need community member participation 9 2.2.4 Successful CBE needs government support 9 2.2.5 The consistence of social, culture and value 10 2.3 The Limitation of CBEs 11 2.3.1 The Internal Limitation of CBEs 11 2.3.2 The External Limitations of CBEs 12 3. Conclusion 12 3.1 Recommendations 13 Bibliography 14
Community-based enterprise (CBE), which is very important for depleted communities, but there are not many researches and studies related to CBE. Although the CBEs are facing the challenge from both internal and external, some of the CBEs have already survived and gotten stronger for many years, for instance, Mondragon Corporation Cooperative in Spain and New Dawn Enterprise in Cape Breton. According to Lionais, some CBEs survive in the mainstream and have the ability to compete with private sector enterprises; meanwhile, these CBEs also maintain social service function. (Lionais D. , 2010). Before this paper starts to analyze the CBE, I will state the relationship between social economy and CBEs. The CBE is one kind of form within social economy, and the CBE has the social goal as well as social economy, so I will use some research that is based on social economy.
Recently, because of the development of CBEs, more and more scholars and researchers pay attention to the CBEs. They have done many researches about the CBEs, and research is in order to find out the issues and the successful model for any others who want to operate or involve in CBE development for communities.
The reasons why some community-based enterprises succeed and some fail. In this paper, I will state and find out some answers and discoveries about the success of CBE development.
In the first part of this paper, it states the definition and background of the community-based enterprise, for instance, what is CBE and what are the differences between the traditional business model and CBEs; what are the key characteristics of CBE.
The second part of this paper gives the discussion about the relationship between the social economy and CBE, and then the third part will state the key factors of the CBE’ success, which focuses on the local community skills, distributing surplus to local communities and the participation of the local community member. Successful CBE needs government support, and the consistence of social, culture and value. In addition, this paper discusses the internal and external challenges of CBEs, these challenges and limitations would make CBEs fail.
The third part will give a conclusion and summary for this paper and delivers some recommendations to the development of CBE.
1.0 Definitions and background of Community-Based Enterprise (CBE)
There are many kinds of definitions about community-based enterprise (CBE). The most widely used definition, I realize is: “a social enterprise as a business with primarily social objectives whose surpluses are principally reinvested for that the purpose in the business or in the community rather than being driven by the need to maximize profit for shareholders and owners.” (Doherty, 2009, p. 26). In Doherty’s opinion, social enterprise or CBE is defined by the organizational type, legal structure and its unique