A guide to third sector trading - WCVA

It’s an idea, but is it business? A guide to third sector trading
1: Getting
started
2: First steps 3: Business
planning
4: Legal and
governance
5: Funding
and
resourcing
6: Financial
controls
7: Managing
growth
8: Management
and
governance
9: Social
enterprise
10: Sources
of support
2.5 What is the trading for?
The dangers of depending on telepathy: It is commonly assumed that defining the community benefit objectives of a
new project is so simple a task that it can be performed telepathically, that is, without bothering to discuss them with
colleagues. In practice, if you simply assume that everyone agrees on your objectives, sooner or later someone will
introduce contradictory aims. That causes confusion and conflicts. One enterprise in a Powys village was so ill-defined
when it got started that the group of farmers involved believed, with good reason, that they were part of a marketing
co-operative, and would share all the financial benefits among themselves. Others in the community were less sure how
profits were to be used. The result was distrust, recrimination, a dismal leadership failure, the waste of a huge amount
of grant money, and the collapse of a great business idea.
Points to bear in mind
The twin purpose: Trading organisations for social enterprises
are distinctive because they have two main functions to achieve
simultaneously – running a successful business and creating
some type of social benefit. You need to plan for both. And you
should definitely distinguish between them if you want to do both
jobs properly.
First steps to the business plan: In your first meetings you need
to start pinning down what you are going to do and why. This
will provide raw material you will need later for the larger job of
producing a business plan or development plan (see Section 3).
A good business plan will require:
• evidence that the project is needed
• evidence that the project is financially achievable and
sustainable.
• a clear long-term purpose or vision’
• objectives and goals you can measure
• business activities (including priorities you can manage)
• operational and financial targets you can monitor and use to
measure progress.
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