The first seminar in the sixth annual series of international ICMEC seminars took place on Monday 26 November 2012 p.m. at UEL's Docklands Campus.
Profit or surplus? Implications for provider sustainability
This seminar explored financial implications of provider aegis. How do social enterprises and for-profit childcare businesses compare in terms of sustainability? Do economies of scale matter? Is ethics an issue? Each issue was explored in depth as part of the discussion following the main presentation to a packed audience.
Zoe Raven, CEO of the Acorn Childcare chain based around Milton Keynes described the chain's evolution before discussing the rationale for her transformation of the originally for-profit organisation into a not-for-profit/social enterprise. She described practical aspects of the process and explained that this is still on-going, as it has been very difficult to convince the bank in particular to understand and accept this change of status. While parts of the business, for instance, its training arm, are already not-for-profit, most of the nurseries have still to change their status. She very honestly set out the benefits and disadvantages of cross-subsidising those nurseries operating in particularly disadvantaged locations with the income from nurseries operating in areas with high employment levels. Her PP presentation can be found here.
There followed a wide-ranging and very lively discussion with the audience of childcare business leaders, local authority policy makers, academics, students, think tank staff, journalists and others. Delegates shared their experiences of running for-profit and not-for-profit childcare enterprises, as well as a cooperative setting which had adopted a truly collective approach. The audience appeared to agree that the value of childcare business assets resided mainly in any property owned. Equipment was worth very little after depreciation. This had implications for any arrangements entered into such as 'sale and leaseback' which removed the type of asset on which a business might be able to raise additional funds.
Delegates discovered that Zoe had found that the Charities Aid Foundations had been unable to provide help to the Acorn childcare chain, despite its focus on social enterprises. The discussion also covered the impact that Zoe claimed the training provided to Acorn Childcare staff had had on staff retention, promotion, morale and effectiveness. Current childcare policy was touched on, particularly in relation to the capacity of local government to support alternative childcare business model development.
Dr Barbra Wallace, Open University Business School, had been scheduled to provide a commentary on Zoe Raven's presentation, informed by her own work on social enterprises. Unfortunately she had been unable to travel to Docklands from the West Country, due to the floods. ICMEC's co-directors hope that she will be able to contribute to another of the 2013 seminars.
Posted 28 November 2012.