ASSESSING THE STATE OF SOCIAL ENTERPRISE: A CASE STUDY ON SELECTED NON-GOVERNMENTAL ORGANIZATION IN ADDIS ABABA

Abstract

A social enterprise is an organization that aims to achieve both financial and social objectives. The financial objective is to generate profit and the social objective is to utilize income from their commercial activities to improve the well-being of people in wider society. The surpluses are reinvested for that purpose in the business or in the community, rather than being driven by the need to deliver profit to shareholders and owners. Having this in mind, this study has been conducted to assess the state of social enterprise on selected NGOs. Both primary and secondary data collection instruments were used to collect data. The primary data was collected through open and closed ended questionnaire. Regarding the size of sample population , 284 of the respondents was carried out by using census (manger) and convenient sampling (customer). The findings show that there are absence of legal frame work and gap of policy towards social enterprise. The enterprises incur additional costs due to their social mission requirements, Well-structured business model have positive impact on their operations. Limited supply of capital, lack of competent employees in the sector, social missions and lack of right business model are the major factors that affect the performance of the sector. Finally, the researcher suggests that revising the existing legal framework, formulating the right business model and creating multiple source of finance are critical factors for the success of the sector.