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4 Business networking for local value

Hammel, Laury Berrett-Koehler Publishers ePub

It’s likely that one reason you’ve chosen to become an entrepreneur is to be free and independent, but when you open a business, you’re actually joining a network of literally thousands of interdependent businesses. Not only are the partnerships we form within this network critical to our success and the longevity of our businesses, but they also present tremendous opportunities to grow local value.

The three basic categories of businesses that you can form partnerships with are businesses traditionally referred to as vendors or suppliers, businesses in your industry, and local businesses in your community.

If you run a grocery store, hardware store, or other retail establishment, you are dependent on the companies that supply you with the products you sell. If you are a manufacturer, you rely on suppliers, distributors, and retailers. Even if you own a software company, you require the support of companies that construct computers as well as those that market and package your product.

In some companies the relationships with vendors are perhaps less obvious, but no less important, and include insurance agents, HMOs, and janitorial services. When these relationships work, your business can focus its time and energy on upgrading existing products, creating new products, and improving customer service. When these relationships don’t work, doing business can be problematic. In extreme cases, poor vendor relationships can actually bring down a business. For example, a poor relationship with an insurance agent can mean not having an appropriate policy when dealing with the aftermath of a hurricane.

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8 Building a bridge to the future

Hammel, Laury Berrett-Koehler Publishers ePub

As an entrepreneur you can build a business that contributes to your community in ways that go far beyond selling a good product. You can leverage your relationships with all of your stakeholders to help strengthen your community and contribute to the common good.

This becomes even more profound when you consider that you are helping create a feeling of home and a sense of place for people in your community. Having a home is important to all of us. It may not be perfect, but when we think of home we want it to feel comfortable and safe and to bring warmth to our hearts.

Not everyone has a home. Even people who own a house may not feel secure or might even feel homeless. When we are physically or psychologically disconnected, we feel alienated from our world. We may have more technological conveniences today, but these devices don’t help us feel grounded in a community.

Feeling at home comes from those invisible social, emotional, and spiritual parts of us that we experience through relationships with other people. When no one is around whom we know or love or can talk with, we feel isolated and not a part of a community. We may be surrounded by people and yet be lonely.

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2 Values-based financing

Hammel, Laury Berrett-Koehler Publishers ePub

As an entrepreneur, you’re well aware that you need capital to make your business vision a reality. For most of us, this means partnering with financial investors. Forging these financial partnerships is one of the most complicated and arduous tasks you’ll face as an entrepreneur. This chapter will give you strategic guidance and practical examples that will make this job a bit easier and at the same time help you make a meaningful contribution to your community. You’ll see that when values-driven entrepreneurs team with socially conscious investors, they form a powerful combination, and the possibilities for the business and the community are truly limitless.

Choosing the right financial partners has been an underappreciated way for entrepreneurs to contribute to the community. When looking for money, it’s natural for you to be more concerned about finding investors than about using your financial partnerships as a way to help the community. But the way you capitalize your business and where you do your banking can make a difference in your community.

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5 Creating partnerships with nonprofits

Hammel, Laury Berrett-Koehler Publishers ePub

Businesses have a long tradition of contributing to the health and vitality of the community by supporting local nonprofit organizations, such as human service agencies, environmental groups, schools, and youth organizations. For some business leaders the motivation to give is rooted in a genuine interest in supporting the community. For others, contributions are a public relations tool undertaken out of pure self-interest. We suggest that you can embrace both motivations.

You might ask, “Who cares what the motivation is?” We believe that motives do matter; they reflect your company’s values, which last through changes in personnel and programs. The key is finding a contribution strategy that communicates the values you are trying to promote. What is your message to your employees if giving is based solely on the amount of media attention you receive? How likely are your customers to remember your community involvement if you are supporting causes completely unrelated to your business? We hope this chapter will inspire you to design a community program that allows you both to give from the heart and to maximize the impact of your contributions.

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1 Customer and community first

Hammel, Laury Berrett-Koehler Publishers ePub

An entrepreneur finds a need and fills it. However, if you’re one of a fast-growing group of people starting and running companies all across the country (and that includes us), you want to build a business that goes a step further and fills real needs that will improve the quality of people’s lives.

Unfortunately, not all successful businesses sell products that make our lives better. A consumerist culture driven by omnipresent marketing often influences us to buy things we really don’t need. When products are designed to meet artificial needs, they generally have a negative impact on our communities.

Of course, determining which needs are real and which are not can be tricky. You may be thinking that no one should pretend to determine your real needs. And you might even ask, “Shouldn’t the marketplace alone determine whether or not a product succeeds?” Yes, the marketplace is the absolute ruler when it comes to the success or failure of a product.

But it’s also true that in most cases, long-term business success is directly related to the ultimate value of the product to society. We’re sure you could point out plenty of examples of products that have been around for a long time that don’t serve real needs, but as a rule, the products with the longest staying power tend to be the ones that meet actual needs. And going a step further, plenty of us are looking to make purchases that offer genuine value and also match our values. Whether we’re considering a hybrid car or Seventh Generation paper towels, we’ve definitely become more discriminating customers.

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