funding, grants, donations, awards & tradable income, etC.
Typically, social businesses have multiple sources of income to ensure the viability of the enterprise. Sometimes referred to as a “cocktail” of funding, sources can include donations, grants, awards, public sector contracts, private contracts, and tradable service income, to name a few.
Often, the percentage breakdown of revenue sources for social businesses is a good indicator of where the social business sits along a social economy spectrum, ranging from the public to the private sector.
Looking at the percentage as a pie chart gives a good visualization for the social business to understand how reliant their plan is on short term and often condition-laden income (grants and donations, etc.) versus tradable income.
Remember that estimating tradable income for your products and services to customers will require you to think about your pricing strategy. When developing a pricing strategy, bear in mind the overall cost to make and deliver the product or service, what you think your customers can afford to pay, and what your competitors are charging currently.
Check out this resource for further learning:
“Ten Nonprofit Funding Models,” SSIR, By William Landes Foster, Peter Kim, & Barbara Christiansen Spring 2009