Bicycles that generate opportunities: how to transform from an NGO into a social enterprise
- Jessica Oyarbide
- Aug 22, 2024
- 4 min read
Can initiatives created to solve social and/or environmental problems achieve economic sustainability? It may sound utopian, but there are business models designed for this purpose: Social Enterprises.
NGOs (Non-Governmental Organizations) or foundations often emerge as a philanthropic response to a social and/or environmental problem. Those who promote these types of organizations are driven by a deep desire to transform a reality that concerns them, and they focus on solving or mitigating said problem through their work. These are non-profit organizations that typically sustain their activities through donations or subsidies they receive from public and private organizations, or individual donors.
In some cases, nonprofit organizations develop projects, programs, products, or services that they market to generate revenue to support their structures and costs, but these initiatives do not typically account for the largest percentage of their revenue.
On the other hand, Social Enterprises are organizations that are often motivated by the same purpose: to contribute to solving or mitigating a social and/or environmental problem. The big difference is that these types of organizations don't typically rely on donations or subsidies to carry out their activities, but rather develop a business model. That is, they create products or services that they sell to support their structures, and even generate profits, which are typically reinvested to continue contributing to their main objective: generating a positive impact.
Can NGOs and Social Enterprises be similar? Could an NGO even become a Social Enterprise? There are two cases that were born with a similar purpose and developed two different organizational models, demonstrating the potential for NGOs to become Social Enterprises.
NGO: Community Bicycle Shop, Tandil, Argentina
This project, born in the Villa Italia neighborhood, was created with the goal of reducing the violence suffered by young people between the ages of 13 and 17. The project seeks to employ young people by repairing and fixing bicycles donated by neighbors, which are then refurbished and prepared for sale. Through this, they can begin to raise money, gain work experience, and join a support group.
The project has received public funding to carry out its activities and has also received tools that it has been able to incorporate into its workshop, so that the young people can use them in their work.
The bike shop also offers tutoring classes open to the community for elementary school students and for high school students who attend the workshops. These classes aim to prevent them from dropping out of school, and work with schools and families to provide more comprehensive support.
Additionally, the space offers knitting workshops for mothers of young people, adolescents, mothers, and grandmothers in the community, led by a workshop leader specialized in crochet. The amigurumis they make are often donated to a children's hospital.
Not only that, but a sign language workshop open to the community is also offered. Different initiatives with a common goal: to contribute to social integration and community development.
The bike shop can be visited at Sáenz Peña 545 or contact Micaela 2494600063 or Sergio 2494369638
Social Enterprise: Bikespace CIC, Plymouth, England
This non-profit social enterprise was created with the aim of supporting young people who are excluded from traditional education by providing them with vocational training. A large number of these young people are people with disabilities, who often cannot find jobs that match their abilities and talents. It also provides training opportunities for adults in vulnerable situations and provides bicycles and support to refugees in Devon and Cornwall.
Among the products and services they sell are bicycle recycling and repair workshops, and the provision of logistical support and sales related to the growing market for cargo bikes in Plymouth, similar to small carts that operate on platforms like Rappi or Pedidos Ya.
One of their most innovative services is a membership that people can purchase, offering bicycle maintenance courses for those interested in learning more about the field. They also offer different pricing levels depending on the type of service they receive, such as safety checks, brake and component adjustments, cleanings, alignments, and more. This membership service allows them to generate a steady income from their customers and thus sustain part of their business.
They also run an initiative to support the mental health of older adults and those excluded from the traditional system, called "Trail Therapy." They create bike rides with adults, where they go on outdoor adventures and provide basic repair classes. They also teach bike riding to those who don't know how, and upon completing the program, which lasts approximately 11 weeks, each person receives a recycled bicycle as a gift. They not only organize bike rides, but also create groups for mutual support, encouragement, and community building.
Two bicycle shops, one purpose
These two cases illustrate that different organizational models can be created, all with a common purpose. The Social Enterprise model seeks to achieve economic sustainability in the organization, in addition to contributing to solving or mitigating a problem.
NGOs can also begin to explore business models to carry out their activities, especially in complex contexts where it is difficult to obtain donations or subsidies, and the risk of depending on them, especially if they are public funds, can jeopardize the continuity of the project.
While becoming a Social Enterprise can be a process that requires time, resources, and the development of new skills, especially commercial tools, one way to begin validating a business model is by partnering with existing businesses. For example, if the Tandil community bike shop partnered with traditional for-profit bike shops, it could begin providing repair services, become a supplier of these services, or generate initiatives and campaigns where, for example, a percentage of the sales of a certain type of product would be donated to the NGO.
There are numerous examples of how to generate sustainable initiatives. The key is to achieve a commercial vision, a sense of purpose, and find the right allies to support and promote local and sustainable development.
Marcas que Marcan advises Social and Impact Enterprises on developing their positive impact strategies and finding key partners through consulting, mentoring, and impact projects. If you require these types of services, please contact jessica@marcasquemarcan.com.
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