Tag Archives: price

From tabletop to laptop – Recover

Latest in the More Expert by Experience series. For other profiles, see http://bit.ly/1rd75hZ

Recover logoWhen I last spoke to Ian Block about his business plan, he’d three years to achieve self-funding from sales of quality upcycled pre-loved furniture. At that time (February 2014) Recover – the social enterprise he leads in Welwyn Garden City – was one year old. I wondered how the three year plan had progressed over the previous two years.

“Our mission has remained the same throughout” confirms Ian “It’s about helping people reintegrate and get themselves worthwhile employment that will stay with them, and help them to be the best they can be; that they feel fulfilled and their lives are worthwhile.”

I asked whether there had been any surprises – good or bad. Continuing the theme of benefiting the volunteers, Ian points to success at the rate at which people have gained and used new skills. Recover has helped raise expectations to the stage where, says Ian, most volunteers are keen to progress.

Looking back, Recover have learnt some hard lessons about the reality of working with people who are furthest from the jobs market. One lesson is a well-known ‘problem of success’ for many social enterprises – that the most capable and productive unemployed volunteers move to paid jobs – an occupational hazard! And for those that remain…

Recover people and products

“There are a broader range of issues facing our volunteers than we anticipated. Their lives are complicated and it takes more time and support for people to move on and stay moved on, particularly when they are older or have lower self-esteem.”

“We thought that the majority of volunteers would progress relatively quickly and then help run Recover. But once out of treatment, when they come to us, the original problems may resurface; they need a lot of hand-holding to develop a sense of self-worth.”   

The first step, of what is often a long journey, is turning up on a regular basis – establishing some structure and routine. Recover offers work and life skills development through refurbishing quality, high-end furniture and Ian doesn’t underestimate the challenge.

“We’re not making sandwiches here – the work takes skill, concentration, focus, practice creativity, Recover recoveringtechnique. We’ve developed methods, systems and processes to keep it as simple as possible, but it still takes a lot of time to teach and embed the learning.”

The intensity of the hands-on support for volunteers means that Ian is finding it harder to balance the books from sales than he’d anticipated. Recover is currently aiming for 50% of income from sales and 50% from funding.

The biggest single development over the past 12 months has been the transition to independence from Recover’s parent charity. Recover is now a Company Limited by Guarantee and Registered Charity in its own right. This means more paperwork as back office functions are taken in-house, including insurance, funding applications, and reporting to the new directors.

Despite the increased demands on his time, Ian is clear about what matters “My priorities are supporting our team and making money. The backroom work has to be fitted in around that. Reporting alone could become a fulltime job if you let it – I started out working on dining tables, now I spend a lot of time on computerised tables!”

Looking ahead, it’s about finding the right balance between growth and consolidation. For Ian the books must balance to keep the doors open. Recover aspires to raise their 50:50 funding/earning ratio to 100% income from trading, but wisely he doesn’t set a date for this.

In the meantime, Recover are getting to grips with pricing – an issue for many social enterprises and an area where Ian is learning fast ‘what works’.

                                                                     Ian gets hands on

“We’re educating people about value – the quality and cost of our work. We’ve been  able to reduce prices as we’ve got better  and faster at refurbishment. The pieces   that we turn into ‘artisan one-of- kind items’ are well-priced compared with mass produced generic flat pack furniture from economy high street chain stores. Items     we don’t refurbish are sold at considerably lower prices than charity shops. Sometimes, we just ask people on low income for a donation that suits their budget.”

Another ‘problem of success’ – in addition to losing the most capable volunteers – relates to Recover’s high profile (“done without any paid advertising” adds Ian proudly).  The two staff members are finding increased demands on their time – from media people, businesses (all support welcome!) and statutory sector staff.

A timely reminder that I’ve taken over an hour of Ian’s time. As I leave, he joins his team for lunch which, he tells me, will be a main meal of the day for some. Yes – two years on from our original meeting, the strengths and values of Recover are still very much in evidence.

 Further information and contact:

http://www.recoverteam.co.uk https://www.facebook.com/recoverteam.co.uk https://twitter.com/RecoverTeam

https://enterpriseessentials.wordpress.com/2014/02/19/the-art-of-adding-value (February 2014)

 

 

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The Feed – a recipe for resilience

Latest in the new ‘More Expert by Experience’ series

Barry AllardThe Feed is a trading arm of Community Interest Company LEAP (www.norwichleap.co.uk)  providing fine food, catering services and more, in and around Norwich. They’re passionate about food and people – well, that’s what it says on their website – and nothing The Feed’s founder Barry Allard, a Fellow of the School for Social Entrepreneurs in Ipswich, tells me makes me think otherwise.                                                                                                                                                                                    I’m re-interviewing Barry 18 months on from our first chat about what starting a social enterprise demands and how he and his growing team have overcome the challenges.

The ‘social’ part of the enterprise is about providing work experience and training in hospitality and catering for those who, for a variety of reasons, are furthest from the job market.

The academy that Barry talked about in September 2014 has now supported three cohorts of learners through a 12-week course. The Flourish Employment Academy involves formal training working in the business and day workshops at local food producers.

When I ask about the intention 18 months ago to source ingredients locally, Barry is upfront about current considerations,

“We aim to use local producers wherever possible, and the Norfolk Food & Drink Festival community have helped us with this, but increasingly we also have to be aware about the cost of buying local.”

Balancing the ‘social’ and the ‘enterprise’ – principle and profit – is nothing new amongst businesses like The Feed that set out to bring business solutions to social problems. Barry is honest but positive about how they’ve been getting their house in order in recent months.

“I was realising that the hours I was putting into setting up The Feed [and LEAP – also founded by Barry] were not sustainable, and I required people with the necessary experience in the catering and hospitality industry.”

Feed logoThe solution was to take the big step of employing an experienced chef and adding to the staff team another recruit with relevant catering and retailing skills. Barry believes that they are now getting on top of the figures with better costings and the ability to make more informed decisions about which events to attend to make money and/or raise their profile. This has also enabled The Feed to make more contacts in the industry.

Another major development is the relocation of The Feed to Open – a multi-purpose arts and entertainment venue in central Norwich working with and for young people. Access to bigger kitchens, and opportunities to cater for conferences and other events on-site, has demonstrated the benefits of The Feed’s willingness to work in partnership with others.

18 months ago Barry Allard was aware that the catering and hospitality industry was not easy sector to work in. It seems his opinion hasn’t changed,

“It’s a difficult business; there’s the upfront expenditure with no guaranteed return and the potential for waste. A lot of behind-the-scenes work goes into putting food on the plate with associated costs, and success is often weather-dependent.”

Barry hasn’t yet worked out how to control the weather, but I’m left with the impression that he and his team are getting a firm grip on the financials and also seeing reward in preparing learners well for the world of work wherever their careers take them.   

Further reading:

Fast Food, Lifelong Learning https://enterpriseessentials.wordpress.com/2014/09/23/fast-food-lifelong-learning (September 2014)

Follow The Feed at http://the-feed.co.uk Twitter: @TheFeedCIC   Facebook: thefeedCIC

Value, cost and price

Tractor-For-Sale-Tinsign“Pricing based on cost makes no sense whatsoever. Cost isn’t abstract, but value is.”  Seth Godin

My Dad’s family business – the only company in the world to make hand-embroidered tapestries for the international market – liquidated around 1970. It was just about the time I might have gone into the family firm but for my father the closure was a relief; as Financial Director he’d foreseen the beginning of the end – the Equal Pay Act – a number of years earlier.

The tapestries were high quality and hand-crafted and, even before equal pay, labour costs were high. The women weavers and embroiderers, 90% of the workforce, were highly trained and the work was labour-intensive. The tapestries had to sell for increasingly high prices and people preferred to spend their money on fast cars and big houses.

And when people did buy these works of art, I remember my Dad saying “they’re more interested in telling their friends how much they paid for the tapestry than valuing the quality of the work”.

Fast-forward 45 years and I haven’t a clue about the true value of even the most basic commodity – milk. I pay twice as much for a pint at my local shop compared with our edge-of-town supermarket. I may be stupid but I’d prefer to support the shop at the end of my road while it’s still there (and while I can afford to) rather than line the coffers of the superstore with a strap-line that says ‘very little helps’ …or something like that.

And what about books? I spent 15 years in publishing and left the industry just as the Net Book Agreement – which set a book’s price across all outlets – was withdrawn. Now the price of a book seems to have no relation to its length or format. Nor, of course, does price relate to the thing we value most – the quality of the contents. The industry now seems to treat books as just another commodity, priced at what the market (that’s you and me) will bear.

Personally, I don’t see books as a commodity, but then maybe I’m out of step with current trends (I’ve shunned an e-reader in favour of ‘the real thing’ and will do so as long as my eyesight and bookshelf space allows). And it also matters to me that my online book-buying supports high street bookshops, so I use www.hive.co.uk.

With the explosion of £ shops (I’ve even seen a 95p store), Black Friday, all-year-round sales, and 2-for-1 meal deals, I don’t know what I should be paying for even the most basic items, not just milk and books. But I like the idea of restaurants inviting diners to pay what they think their meal is worth…

Until I get too old to make my own decisions, I aim to pay a fair price for what I value – stuff that’s good quality, where possible is locally-sourced and ethically-produced, and that doesn’t screw someone in the supply chain.

This is not easy, I know. But most of us can choose how and where we spend our money. Maybe we should spend more time doing so?

For an interesting insight into the buying process, go to http://sethgodin.typepad.com/seths_blog/2014/02/most-of-all-money-is-a-story.html

A useful and all-embracing list of pricing strategies is at http://bit.ly/1moB0lR

 

A passion for pallets

???????????????????????????????Creative flair, a willingness to roll up sleeves and ‘have a go’, to experiment and being prepared to fail, all make Dawn Taylor well suited to a recent, perhaps surprising, career development. Dawn is founder of York-based enterprise Purepallets which does what it says on the tin (or should that be timber?) turning pallets into crafted items fit to grace any home.

From wine racks and candle holders to what can only be described as ‘letter wall shelving’ (B anyone?) pallet product design and creation clearly excites Dawn.

But perhaps the new career move is not so surprising, as Dawn explains… “When I was young I was a tomboy. My dad was a plumber and built our extension by himself, and I helped him. I learnt how to mix cement and lay bricks, so from an early age I’ve not been scared to try new things.” 

So, practical from an early age and Dawn’s creativity – probably also rooted in her past – has been honed through a career in retailing, including 14 years as a visual merchandiser with a major UK high street store.

And what could be more creative than turning a much-maligned product – the humble pallet which many of Dawn’s friends think is only good for firewood – into a thing with real appeal, each one unique? Having “fallen into making pallet products by accident” – an unexpected commission to make a wine rack – Dawn was soon bitten by the upcycling bug. She has just started experimenting with paint effects but still delights in the beauty of the ‘pure pallet’ finish which, when embossed with the original owners logo adds to the story behind the product.

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Now taking a service break with her current employer, Dawn has nine months to see if she can ‘give birth’ to a financially viable business. The product range is developing nicely – mainly through commissions from a rapidly widening customer base that values the bespoke nature of each item. With low overheads to date – pallets are sourced locally at low/no cost, the workshop is a garage at home, social media and word-of-mouth are the main marketing tools – there may be a temptation to under-value the finished product.

But Dawn believes her promotional offer – quality and uniqueness at affordable prices – could create a sustainable business model. While pallets grow on trees (well, sort of…) Dawn’s talents do not. With these she may just be able to differentiate Purepallets’ product range from others and have champagne corks popping.

See Purepallets products at http://on.fb.me/1xtfc8T

 

An A – Z of social entrepreneurship: P – S

P & Q  – Price and quality 

There’s a danger that, in the fight for public service and other contracts, social enterprise is promoted as a cheaper vehicle for providing goods and services. Some social entrepreneurs who should know better find themselves making such claims. In only a few cases have I ever found this to be true.

Social entrepreneurs will never ultimately win a battle on price, however much we may want to be the chosen provider, and it’s a dangerous route to go down. In reality, social enterprise is an expensive business model – employing people deemed ‘unemployable’, providing what others won’t, and locating in places others don’t go. I’ve always believed ‘better not cheaper’ is a much more sustainable mantra than ‘more for less’.   

R – Risk  

– “If we wait for the moment when everything, absolutely everything is ready, we shall never begin.” Ivan Turgenev

Textbooks tell us we need to have a fully grown business plan in place before launching an enterprise to minimise risk. But increasing in a fact-moving business environment, there’s a case for getting products/ services out there before they are fully formed.

The argument for a ‘lean start-up’ is that there’s no substitute for market-testing with real products and services and that early-stage feedback is more likely to be taken on board because it’s not written in stone in your fully developed business plan. 

S – Systems 

When asked how he ‘turned around’ an international charity that had grown too fast for its own good, the new Chief Officer’s one word answer was ‘systems’.

Social entrepreneurs are renowned for being flighty and fact-moving. Frustrated staff at a great social enterprise once told me “the business runs best when xxxx [its inspiring founder] is not around”.  

Just as there is usually a team behind every great social entrepreneur, so there needs to be systems people who can identify what works that can be shaped into a regular way of working that gives the enterprise firm foundations and brings stability from day to day.

 

Enterprise essential – compete on quality not price

“Better, not cheaper” is a more sustainable mantra than “more for less”. Price your products and services so you can offer discounts by working out three prices. The top ‘dream price’ represents the real value of your input. The middle price should represent a good profit margin, and the bottom price is one you should never go below. Start by asking your dream price and only negotiate down for bulk orders, payment up front etc.

Enterprise essential – pricing is about demand and supply

Charging different prices at different times, responding to changes in demand is OK. Airlines, cinemas and ice-cream sellers do it. A community café could do it to profit from affluent workers with limited time at lunchtimes to allow others who are time-rich and cash-poor to eat more cheaply mid-afternoon.