This week we are looking at competitor analysis which will help entrepreneurs distinguish his or her products and services from the crowd and seize a sizeable market share. However, if we look at the “competitors” for social enterprises which emphasize double bottom line, i.e. social and financial returns, competitors may not sound as atrocious as those in private sectors. Down to the earth, these competitors and social enterprises themselves are doing a good thing by fulfilling some social need by offering low cost or even free products and services to those in need.
During an interview with CNN, Ms. Sheridan Wood, Executive Director of the Kansas City Free Health Clinic and former President of the National Association of Free Clinics, had an interesting dialogue with the host. The question goes “Would you like the Obama Administration to come up with a plan that put you out of business?”, and she responded “That would be wonderful. But even with all the plans that are circulating, there are still gonna be people who are uninsured….Even with the plan, it will still leave back 10 million people who need medical care.”
Her comment highlights my understanding of how we should look at competitors for social enterprises. In the first few classes, we came across a similar discussion after watching the video on Muhammad Yunus. Is competition a bad thing for social enterprises? Not necessarily. Instead, different from the nature of private sector, I think social enterprises have an advantage in dealing with competitors. Instead of looking at those who have similar goals and serve the same market segments as competitors, why not look at them as allies or partners? They have the same passion, serve a group of people with homogeneous characteristics and possess expertise that is crucial for our social enterprises as well. For example, to make my social venture financially sustainable, I am trying every method to draw on existing resources to bring in revenues and to reduce costs and challenges. My goal is to provide health insurance for those who cannot. Any “help” from “competitors” is welcome. Instead of diving into the health insurance business that I have no expertise in, why not bring in the existing insurance companies and persuade them to offer affordable premiums? Aware of existence of free clinics around the country who offer medical care for the uninsured, maybe I can cooperate with them to offer insurance to the uninsured which have been screened by them.
What makes social enterprises achieve this and what makes private businesses cannot is the fact that social enterprises are often serving a market that is neglected and their goal is not profit maximization but to meet the needs of the neglected. For social entrepreneurs, they should care less grabbing the market from competitors, but more on how to serve the market better and faster by offering the best services and products.
How can I partner with and utilize my competitors’ expertise and resources for the benefit of my social venture? It is a question that I will figure out to make my venture more financially sustainable.
FYI:
Professor Jerr Boschee, Founder of the Institute for Social Entrepreneurs and a faculty of CMU, proposes a strategic marketing matrix for social enterprises. This incorporates the double bottom line. For more information, please visit: http://www.socialent.org/pdfs/StrategicMarketing.pdf.
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