The sustainable power of business used as a force for good is undeniable.
We are living in exciting times where the world is more connected than ever before, and this connectivity means entrepreneurs and small businesses have a much greater reach than in the past.
Furthermore, doing good is good business.
Not only does a purpose driven business provide fulfillment to you and your employees, it helps you attract better customers and better employees, as well as make your company more strategic and sustainable.
It helps to give true meaning to your work and clarifies your marketing messages.
It keeps you going on those days when you realize just how hard building a business really is.
AND you are making a positive impact on people around the world.
But, what people don’t tell you, is just quite how difficult it is to build a business - especially to build an authentic, do good brand.
Where do you start? How do you create impact without spending money? Is it possible to be both profitable and mission driven?
Below I’ve given you 5 of the top mistakes people make (myself included) when building a social enterprise or launching a social impact initiative within your company, and what you can do to keep from making these same mistakes.
Because at the end of the day, none of us wants to choose between profitability and social impact.
It is possible to grow your business AND increase your impact - without sacrificing either!
Mistake #1 - Thinking your mission alone will drive people to purchase what you are selling.
Your mission is great for getting friends and family on board at the beginning.
But, sadly that enthusiasm will eventually taper off if you aren’t offering high quality products and services that your customers want.
Ask yourself (or survey potential customers) - would you buy this without knowing any of the story behind it?
If not, what can we improve? You have to create products and services people love and want first, and your spectacular mission should be the cherry on top.
Takeaway: Focus on building a sustainable business with quality offerings and a solid plan to bring in new sales.
Mistake #2 - Neglecting the business side of your purpose driven business.
We all love to dive into the mission of our businesses, but we have to remember this first needs to be a business.
You have to focus on your margins and profitability in addition to your give back side in order to be sustainable.
Otherwise, you will likely start off with a bang, but start to fizzle out once you realize the margins aren’t sustainable.
Ask yourself, is our give back side practical?
Takeaway: In order to have a great give back side, you first have to focus on your numbers and margins to ensure your business is sustainable.
Mistake #3 - Not considering scalability from the beginning.
This is a tough one, but something that needs to be thought through from the very beginning.
Whether you offer products or services, you need to ask yourself - is this business scalable so that I can grow the company, as well as our impact?
This is something I am currently working on with MM at the moment.
I made sure our product side was scalable from the beginning, but we are now to the point where I need to figure out how to scale our impact side in order to make it practical. (200k hours of business school just simply can’t be done the same way that our first 350 hours were.)
Takeaway: Focus on building a business with products and services that are scalable, as well as a give back side that can scale. You don’t want production limitations or program limitations holding your company back.
Mistake #4 - Not being aligned with the impact your customers want to make.
You have to make your impact tangible to your customers, as well as make sure this is something they care about when buying from you.
Your social impact side should be aligned with your business in order to make this a win-win-win situation.
Don’t just pick a random charity to give a portion of your profits to. Let me say this again, do not pick a random charity to give a portion of your profits to. (There are MUCH better ways to do this!)
This won’t do much beyond decrease your profit margins in the long run, which isn’t good for the charity you’ve chosen either.
Ask yourself, does this align with my customers and their values and desired impact?
Takeaway: Ask your customers what type of impact they would like to see you making? Ask yourself, what you are uniquely suited to providing? Oftentimes, it does not have to be a percentage of profits, but rather your unique expertise that will help someone the most.
Mistake #5 - Not taking the time to research whether this is the best way you can serve the desired recipient.
Again, you really need to spend some time thinking this through.
For our office products line, I knew our customers for the products would be professional women that truly believe in the power of business to empower women around the world.
I also knew my background was in international business and consulting to senior executives at Fortune100 companies, and that truly was where my skills and passion met.
But I struggled with coming up with a tangible give back side per product/service that our customers would relate to AND was what our desired recipients needed.
The easy thing to have done would’ve been to give a notebook for every notebook purchased, but was a notebook what these women really needed?
Instead of guessing, I asked. I found a group of women I wanted to work with, and asked them what they needed.
And it wasn’t a product - they wanted and craved knowledge.
Knowledge that I had been sharing with companies in their area of the world to begin with, so that’s why I decided to launch the Marie Mae Business School.
This is why for each product and service purchased, we provide an hour of business training to a woman in an emerging market. It’s tangible AND needed AND utilized our unique skills/abilities.
Takeaway: Don’t just come up with a give back side that you would like to do. Take the time to research what is needed, and match that up with the best way you are able to help.
Remember, you don't have to choose between profitability and making an impact.
Although most will race to add a social impact component to their business, few will take the time to build a strategic and sustainable business that makes a positive impact.
The way you build a sustainable company with a lasting impact is to bypass the 5 major pitfalls above, while thoughtfully building a purpose driven business with a perfect step-by-step plan.
One that helps you navigate all of the pitfalls faster, so that you can grow your business and increase your impact - without sacrificing either!