Non-Profit Business Plan Guide for Social Enterprise Success

Many non-profits don’t have (or need) a business plan. However, once you venture into social enterprises, it becomes essential for success, whether self-funding or seeking outside investment in your enterprise. 

A comprehensive non-profit social enterprise business plan assesses all aspects of the business idea. It explores and examines where your social enterprise is headed, how it will get there, and how/why it will succeed. Every business plan is as unique as the social enterprise and the individuals who write it.

There are many guides that lead you through the business planning process. The goal with this article isn’t to provide you the how to, but rather to highlight some things that may be unique to non-profit social enterprises and other important considerations.

Executive summary

The Executive Summary is the “hook” that encourages readers to explore the full plan. It provides a high-level summary of the full plan, helping bring the business picture into focus. A strong, concise Executive Summary is less than two pages long.

While it might seem natural to write this section first, we recommend writing it last. Complete all other sections of the business plan, then write your summary afterwards to ensure it’s an accurate representation of your findings and plans.

Company description

The company description reflects on foundational information about social enterprise: social outcomes, legal structure, history, mission, vision, and values, and your unique sales proposition (USP). You can also add other company details here physical address of the social enterprise, key staff members, advisory members and their expertise, key suppliers, etc. A brief mention of its relationship to your non-profit can also be helpful.

Market research and analysis

Showcase the data, statistics, and facts that demonstrate why this social enterprise is feasible. Include details like customer segments, competitive analysis, industry growth and trends, position in the marketplace, and other supporting data.

The Market Research component of your business plan starts with a hypothesis that you need to evaluate and examine: “If we start a social enterprise that does this, we should achieve the following outcomes…”  The goal: prove this hypothesis correct using primary and secondary market research.

We recommend not skimping on this section of your plan. When done right, your Market Research and Analysis will inform all other aspects of your planning process. Your primary and secondary research here takes the guesswork out of sales estimates, revenue projections, hiring needs, and more. Strong, accurate research, while time-consuming to do right, sets the foundation for a successful social enterprise.

Organization and management

The organization and management section of your plan defines how the non-profit and the social enterprise are entwined and how they will operate in relation to each other – the legal structure, governance structure.

Your social enterprise structure determines how your social enterprise is established, how it is managed, who it reports to, and where and how funds are redistributed within the “parent” non-profit.

To choose the best business model for your social enterprise, we recommend consulting with a non-profit lawyer. In the meantime, read more about corporate structures for non-profits from the Government of Canada website. 

Marketing and sales strategy

In this section, describe how the product/service will be brought to market and sold. This section addresses the four P’s of marketing: product, price, place, and promotion. This information includes who, what, when, and how of reaching the target audience and selling the product to the consumer. 

This section of your business plan will provide an overview of your marketing plan. Be sure to include a more details sales and marketing plan in Appendices section at the end. 

Operations and implementation plan

The operations and implementation plan address topics including product development, inventory control, facility requirements, safety and environmental factors, staffing, policies and procedures, and implementation plan.

Work through the details including, staff, facility, and technology requirements. Knowing this in advance will save you time, money, and effort.

Social impact and outcomes

Every social enterprise has a social, cultural, or environmental outcome at its heart. It is essential to communicate impact and outcomes to staff, customers, partners, and the community. Weave the impact and outcome statements into the business plan; demonstrating throughout how these are central to the social enterprises work and philosophy.

Be clear about what the desired impacts and outcomes are for the social enterprise. Here’s an example:

“To deliver our mental health programs across the province through partner agencies, thereby providing partners with pre-designed and best in class curriculum, and participants with greater opportunities to improve their confidence, develop strong coping strategies, and choose personal habits that support positive mental health outcomes.”

Financial plan and projections

The financial plan and projections drive the “Go-No Go” decision making. During the research phase of planning it is easy to assess the numbers positively --through rose-coloured glasses. In this section of your plan, you set these glasses aside to take a look at the market share, purchase price, customer frequency, sales estimates, and inventory is required objectively. 

My rule of thumb is to divide revenue projections by 50% (and this may still be too high) and increase expenses by 25%. Always double the time needed to navigate what seems like a simple process. It won’t be that simple.

Work through the financials’ yourself, with the assistance of financial professionals where needed. It is essential that you know your business plan and your financials, inside and out.

Ask a professional accountant to review the numbers, formulas, and results in detail to confirm your calculations and projections. Professional accountants can provide an objective view of what is possible, can reframe your projections more realistically, and identify which ratios need to be watched with care.

Risk management

Risk management involves identifying, assessing, monitoring, and reporting on potential risks. Brainstorm potential scenarios and answer this question for each one: “If this happens, we will do this…”

This risk planning shows your stakeholders you have detailed plan to mitigate any risks, leaving the management team well-prepared to respond. It is best to adopt a risk management policy with a clear risk management process for unexpected risks early in the venture.

Learn more about risk management best practices in this guide from the Canadian Purpose Economy Project.

Appendixes

This closing section of your plan provides supplementary details and a “deeper” dive into the details that inform the business plan. It is often ignored and little thought is put into what is included in this section.

The supporting documents included in the Appendix provide insight into the projections, decisions, and evaluations included in the actual business plan. These insightful documents allow readers to understand the thought process that supports the recommendations made in the business plan.

Funders, investors, and bankers will spend time reading the appendixes in depth, looking for logical conclusions, realistic projections, and achievable results. Don’t neglect this section, it’s a critical component of your social enterprise plan.

To assist readers in getting a full picture of the types of information included in a social enterprise business plan, please download From Idea to Impact: Social Enterprise Business Plan Checklist here.

What’s next?

Once your business plan has been written, have it reviewed and edited by several members of your team to ensure nothing has been forgotten. This will be a valuable tool to get buy-in for your social enterprise idea and potentially to get funding and other supports to make it a reality.

Your business plan will become a guide for your way forward as a social enterprise. It should be kept up to date and referenced often to ensure you’re staying true to your plans and mission.

✨ Curious about where to start or need help to write your social enterprise business plan? Book a Get Curious! Discovery Session with HIP Strategic. Together, we’ll explore your ideas and turn them into a comprehensive business plan.