Community Owned Businesses- The Journey

There is growing recognition of the value of community businesses, preserving community assets and generating economic value for their communities. COVID-19 has clearly demonstrated the importance of supporting communities to be innovative and take the step towards generating wealth locally, avoiding the return to normal economics.

Community imageIn partnership with the Plunkett Foundation, and Community Shares Scotland, Co-operative Development Scotland ran their second Community Business: Making it Easy event this month providing key insight to the realities of establishing a community business and information about the support available

Brian Connolly from the Co-operative Development Scotland was there on the day and shares his key learnings from the event.

Eleanor Porter chair of  Dunshalt Community Shop was the first speaker at the event and she shared the shops story with the audience. She described their journey as a puzzle, looking to recognise the specific pieces which came together. Initially this consisted of a community recognition of loss through the closure of the local shop, risking both a source of groceries, but more importantly a social hub. Having taken steps to prevent a change of property function, this led to the start of external conversations to take the asset into community hands. Through the creation of a business plan and extensive community engagement, a Community Benefit Society was formed. Calling on funding from organisations like Leader, National Lottery and the Scottish Land Fund, a Community Share Issue created a platform to ensure residents were invested in the use of this space and raised over £31k in two months. Despite opening just before COVID-19, the shop has already become an invaluable asset, quickly providing a delivery service for local residents during lock down.

Dave Hollings, chair of the Dog Inn spoke about the experience of running a community owned pub. He highlighted the role the asset plays in providing a service to the community. Alongside the pub, the facility offers community space both internally and through its gardens. It has become a place of music and celebrations, bringing together residents and helping cement its importance in forming social bonds. Adopting a similar approach, the Dog Inn relied on a Community Share Issue allowing it to refurbish the premises on initial purchase and after only two years, create a return on investment. Importantly, the pub is a key employer locally, with 16 of their 25 staff being young people in the area.

Getting Community Buy-in
Following the case studies, there was a chance to hear from the support organisations in terms of how to undertake this journey and what help is available along the way. The first session explored the role of Community Engagement, recognising the need to invest both time and money in securing buy-in for the community business throughout. The act of pursuing community engagement serves several purposes including assessing local need, allowing residents to have their say, reducing opposition and bringing in volunteers / investors. To effectively undertake engagement, there is a need to firstly identify what we are defining as a community; are we referring to a geography or an interest group? There is often a need to specifically target a demographic group and use different language to reach them. Through the journey itself, there are four key elements:

  • Refining your message: What do you want to say and how do you ensure it is both clear and consistent.
  • Consulting: Using a set of pre-agreed questions, there is an opportunity to weave a story about why you are on this journey and gather contacts from interested parties
  • Engaging resource: The need to establish working groups who can take forward actions and utilise volunteer time as it becomes available.
  • Using the right methods: Whether questionnaires, film making, public meetings or informal discussions, selection of the right communication can be vital in securing the support needed.

Choosing the Right Model
The next session explored the role of Governance with the need to ensure the identification of the right model. The selection of the correct organisational structure for your community business impacts future decisions and development.  There are an extensive range of forms from a co-operative society, a private company (by shares or guarantee), or a community interest company. One of the most common forms utilised is the community benefit society which allows the issue of community shares and ensures a democratic approach to change (with one member, one vote). Equally important in selecting a legal form is exploring the governance with a need for clear constitution and a structure which puts members at the heart.

Raising the Finance
Following this was a discussion on the role of Community Shares as a way to raise money for a community enterprise. This is a method of crowd funding that achieves community ownership This is typically part of a larger funding package bringing in partners such as the Scottish Land Trust etc. This approach has been used in the past to finance projects from shops and pubs to harbour developments and renewable energy. A share issue is a great way to grow membership and ensure community involvement as the project develops. This small video will act as a useful explanation for how you can explore this approach: https://youtu.be/q6w-311GBIM

At the heart of any successful community business is a clear development journey. This enables the project to go from idea to a thriving organisation. Every community organisation is different, yet there is always value in learning from the experiences of others. The Plunkett Foundation have produced an invaluable guide to the steps you can expect to take, including some of the challenges you can expect.

Co-operative Development Scotland, Community Shares Scotland and the Plunkett Foundation work in partnership to raise awareness of community business and the available support in Scotland. If you are ready to move forward, please get in touch and we would be delighted to help you.

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