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Finance

Social enterprises may be funded from a number of different sources. Many social enterprises have a mixed funding profile and receive income from other sources in addition to their trading income. Other potential sources of finance include the organisation itself, banks and other lenders, investors, grant bodies and donors as well as in-kind contribution.

 

What is Trading income ?

Trading occurs when an organisation voluntarily undertakes exchanges goods or services with another on a regular basis.  In developed economies this is usually for money or credit.  There is extensive guidance on what constitutes trading and related tax implications.   Examples include a contract for delivery of support services to adults in need of support, providing phone and broadband services, selling training packages.

 

Understanding the financial requirements of your social enterprise is an important part of the overall planning of a social enterprise and it is useful to consider what the finance is required for.

  • Getting startedwhether a new organisation or a new project or activity for an existing one
  • Funding growth, new development or change – within an existing organisation working capital may be needed to meet the income-expenditure gap before trading income gets underway
  • Development capital – may be needed for a new project or activity e.g. where equipment is needed
  • Capital expenditure – funding large expenditure on items with a long life – e.g. for asset purchase or a build project
  • On-going operational costs – funding may also be required to meet on-going revenue costs, especially where grant or contract funding does not meet the full costs of delivery.

 

Information about funding

West Sussex 4 Funding is a service from West Sussex County Council that provides a free service to businesses, voluntary organisations, charities, community groups and social enterprises, to search for sources of funding.

Charities Aid Foundation -The Charities Aid Foundation is a registered charity that works to create greater value for charities and social enterprise by transforming the way donations are made and the way charitable funds are managed.

Community Shares – promotes enterprise equity and engagement through use of community investment shares and bonds.

Government Grants – website with access to  government grants for the voluntary and community sector.

 

For more information about specific funds for social enterprise see Funding Sources.

 

Contracting with public sector

Many social enterprises deliver public funded services through contracts with public bodies.  For more information about contracting for delivery of public services in West Sussex click here.

Contract Finder  A new free facility for small businesses to find online public sector procurement and contracting opportunities above £10,000 went live in April 2011. This provides access to new public sector contract opportunities in addition to closed contract documents.  Contract Finder.



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