When Lynemouth Community Trust wanted to turn around their ailing cafe business they turned to Trust manager Andrew Gooding to come up with a new idea. His plan, back in 2008, was to turn the Northumberland coffee shop into a fully-fledged confectionary business, and he started the process with an enjoyable trip along the beautiful northern coast – tasting fudges, chocolates and cakes, and pitching early-stage concepts to local shop owners.
What he landed on was Kenspeckle, now a fast-growing confectionary brand and proud social enterprise dedicated to reviving the area. The name came from a local word meaning 'distinctive', and the range Gooding has since developed certainly has its own flavour. Chilli and lime chocolate, figgy pudding and chocolate mouthfuls shaped to look like lumps of coal – this is artisan chocolate making at its finest. And the trade is certainly responding.
"We're well known for products that look different, and also for the way our packaging is put together," he explains. "And we've had more interest from customers in the last three months than we've had in the last three years".
The journey to becoming one of Britain's fastest growing confectionary brands hasn't been easy.
"I think we thought that with our experience in the cafe and of dealing with food every day, we'd be able to translate this into food manufacturing pretty easily," says Gooding. "But we had problems with shelf life – most retailers wanted something that would last five months and at the start we could only manage five weeks."
But in the last year, Gooding and his team of confectioners have cracked the formula, giving their range six-month shelf lives and suddenly finding themselves at the centre of retailers' attentions. They've been given an additional boost by a publicity campaign delivered by their parent charity, as well as a GroupOn promotion. Gooding is slightly cautious about the value of these kind of discount sites, explaining: "It's great for getting your name out there, but can be a nightmare to deal with as you just don't know how many people are going to order, and where they're going to be."
Since its launch, the brand has become loved locally – with plenty of distribution up and down the Northumberland coast.
"But our ambition is to be supplying major national retailers, not just regional distributors," Gooding adds. "We're currently at about 60% of our capacity, which is reassuring, but we will need to raise more money in the future."
"The market has been pretty receptive to our requests for loans. One thing we are finding though is that CDFIs [community development finance institutions] aren't offering competitive rates versus the high street. It's understandable given how they operate, but it's slightly galling." On balance Gooding reckons Kenspeckle will eventually rely mostly on high street lending to finance their further growth.
The business has a good track record of raising finance, using loan-purchase to extend their production capacity from fudge into chocolate during the early days of the business. This was important – understanding that chocolate was overall a more profitable place to play meant that Gooding could make the call to invest and get backing from the bank, and it has paid off.
Understanding the mix of products you offer and the core profitability of each has also been key to Aspire Bristol's success. They offer a range of building, gardening and window cleaning services to over a thousand private and commercial customers across Bristol and beyond. However, across this huge customer base, it's their commercial customers that deliver the most profit, so this is where Paul Tipler, regional manager, wants to play harder.
"Our scaling up has been all about understanding that going for the larger commercial contracts, as well as new services like property refurbishment, can be much more profitable", he explains. "To win these kind of contracts we had to offer the same level of service as our competitors, regardless of what backgrounds our employees come from."
Aspire employees often come to the social enterprise with a record of unemployment, an offending or drug abusing history, or experience of homelessness, but the training delivered to them is top-notch and the business saw 42% growth last year.
Gill Winstanley, a co-founder of Argonaut Community Enterprises, sees collaboration with other social enterprises as key to her scaling up strategy. Profoundly deaf, she manages a cleaning business of 15 staff with hearing or sight disabilities.
"Collaboration, used properly, can pay dividends," she argues. "Together we have a stronger voice. Also, it works if each organisation brings in a specific skill set and doesn't directly compete with one another."
"Next week we are talking to another organisation to look at a collaboration. They have people we could, potentially, employ. Together we can secure contracts in a new way. I won't suddenly set up with nothing in the area … we have to get links with other people to make it work."
Winstanley mentions that she is constantly worried about scaling up too fast.
"But it's about taking calculated risks. One of our recent big steps is a new position for operations manager," she explains. "Without this we would not have been able to expand. Also, we've had to invest in advertising."
The investments into staff and marketing have paid off, but like Tipler at Aspire – having a top-notch product has still been absolutely critical, with no easy ride being given to Winstanley's pitch to potential clients.
"It probably costs us about 30% more in time because my employees are either deaf or have sight difficulties. But that's why we're a non-profit", says Winstanley.
"I do 'sell' the fact that by contracting us they are making a highly active contribution to their corporate social responsibility agenda, and there is some advantage to companies who include us in their bidding process in that this automatically contributes to their diversity and inclusion agendas."
But when it comes to securing commercial contracts, she is compared like-for-like against mainstream providers and needs to be competitive on service.
Tapping into government schemes like Access to Work has also been helpful. This scheme assists companies who want to provide supported employment opportunities for deaf or blind staff. For example, in the event of fire, an office worker might be assigned a buddy or a specialist alarm system might be fitted. Interpreters might be needed and extra time allocated to allow conversations to be signed to that employee.
"We have our own special infrastructure to help our deaf employees while they work, and this is growing and becoming more efficient as we scale up"' says Winstanley. "But we use some resources from the Access to Work scheme, and especially when different adaptations and resources are needed."
Winstanley hopes to extend and grow her business, not only in turnover but also in terms of what kinds of people she employs: "We are deaf-led but I want to extend our employment to people with all sorts of disabilities. We're working with blind and partially sighted now, I'd like to take on more."
Content commissioned by Guardian Professional on behalf of Santander
.png?w=600)
