Thu, May 09, 2019 - Page 12 News List

More social enterprises turning profitable: survey

By Kao Shih-ching  /  Staff reporter

DBS Bank general manager Lim Him-chuan, second right, and Minister Without Portfolio Audrey Tang, second left, pose at a news conference in Taipei yesterday to announce the bank’s survey results on social enterprises.

Photo: Kao Shih-ching, Taipei Times

About 26.3 percent of social enterprises in Taiwan make a profit, an increase of 5.1 percentage points from two years ago, as more firms established business models that balance profit-making with social missions, a DBS Bank Ltd (星展銀行) survey showed yesterday.

Fewer social enterprises are in the red, as the poll showed that 30.3 percent are losing money, compared with 34 percent two years ago.

About 38 percent of social enterprises have broken even, down from 40 percent in 2017, it showed.

“Although people have the impression that social businesses tend to be less profitable than other enterprises, the survey showed that many can support themselves financially,” DBS Taiwan general manager Lim Him-chuan (林鑫川) told a news conference in Taipei.

The bank conducted the survey of 2,144 respondents and 561 social firms in March, after it conducted a similar poll in 2017.

A total of 30.6 percent of respondents said that they were familiar with the concept of social enterprises, a jump from 19.9 percent two years ago.

However, fewer respondents said that they were willing to buy products or services provided by social businesses, with only 64.8 percent of respondents saying that they would purchase products from social businesses, down 8.4 percentage points from 2017.

“The results are not contradictory, but show that even though consumers support the idea of social businesses, they still consider the quality of products and services to be the priority when deciding whether to pay,” said Eva Kang (康廷嶽), a deputy director at the Taiwan Institute of Economic Research (台灣經濟研究院), which helped conduct the poll.

Consumers would not support companies unconditionally, so it is important for companies to focus on their products or services if they aim to earn enough profits to sustain themselves, she said.

Companies used to buy social enterprises’ products as gifts for their employees to show their social responsibility, Minister Without Portfolio Audrey Tang (唐鳳) said.

However, firms are now buying more such products because their quality has improved, and have included them in their regular procurements, which help social enterprises make profits, Tang added.

It is not easy for social businesses to obtain loans at conventional banks considering their financial performances, Lim said, adding that DBS has been more helpful to social businesses than other foreign banks.

Over the past three years, DBS has provided loans to about 30 social enterprises, with a single loan averaging NT$1 million to NT$5 million (US$32,342 to US$161,708), the bank said.

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