Social contracts

Social enterprises (SEs) in Hong Kong are at full tilt, building brand recognition, diversifying interests and trying to drive up revenue, all in the name of "survival".迷你倉 As Oswald Chan reports, SEs' quest for economic viability is never easy. Dialogue in the Dark (Hong Kong) When KK Tse and Patrick Cheung, veteran investors in local social enterprise decided to open a local franchise "Dialogue in the Dark" (DiD) business, in 2009, they really were aiming at developing a social enterprise based on a sustainable business model to create jobs for the visually impaired and the hearing impaired. Tse and Cheung wanted DiD Hong Kong to stand on its own without government subsidy. As their alternative, they rounded up financial commitments of HK$5.72 million ($738,000) from 20 individual investors. Four years later, DiD Hong Kong has achieved financial sustainability and recorded a profit of nearly HK$2 million in 2012. Today, DiD Hong Kong is a multi-faceted brand, extending into experiential exhibitions, dining and birthday celebrations, music concerts, theatrical performances and even corporate management training. DiD Hong Kong employs 83 full-time and part-time staff, of which 61 staff are visually or hearing impaired. Building social bonds The inspiration behind the DiD Hong Kong is to help the community at large to understand difficulties of those who have visual or hearing impairments. The method is to create the experience of complete darkness or complete silence to give greater insight to people with normal sight and hearing. One of DiD Hong Kong's activity brands, Experiential Exhibition in the Dark held at DiD's Mei Foo location, takes participants on a 75-minute journey through a world of complete darkness and silence. The experience is aimed at fostering greater awareness among participants, of what it's like to suffer from these physical impairments. Experiential Exhibition in the Dark, has been ranked by the online tourism website, TripAdvisor as a "must see attraction" in Hong Kong. "DiD Hong Kong's concept is based on a vision of building social bonds between the community at large and the disabled. The more that people identify with this vision of inclusion, the more this social ideal can become a strong publicity tool for corporate marketing," DiD Hong Kong Chief Executive Officer Antony Pang tells China Daily. Looking ahead, the social enterprise has mapped out plans for more co-branding products and services to enhance its revenue streams. DiD Hong Kong is considering cooperation with Ngong Ping 360 to open a dark exhibition hall at the Ngong Ping 360 cable car station. The endeavor would mark DiD's first venture into the city's conventional tourist sites. The company is also engaged with Commercial Radio Hong Kong to introduce its other activity brand-"Dating in the Dark." Some local male and female artists have volunteered to produce a radio show from DiD Hong Kong's dark exhibition room. The program, broadcast on the Commercial Radio Hong Kong channel, is intended to inspire greater reflection toward love between a man and a woman, which is not based on visual impressions. Impaired people's handicrafts DiD Hong Kong is also incubating a new merchandise line: handicrafts fashioned by people with visual and hearing impairments. Participants actually are able to establish a career path, while the profits help to enhance DiD's revenue stream. "Through diversifying our different activity brands to cater to the needs of different population segments, it can scale up our business and foster business growth. All this contributes to our profitability as well as to enlarge our social investment impacts in the future," Pang tells China Daily. Pang warns that the DiD Hong Kong experience should be not generalized so as to assert an argument that SEs in Hong Kong are readily successful at maintaining fiscal sustainability. "There is a strong local cultural bias that the product or service quality provided by SEs usually is inferior to other commercial organizations. Indeed, the product or service quality standard of Hong Kong SEs sometimes is widely variable, so that local SEs must strive for stringent product or service quality control to ensure consistent quality standard," Pang cautions. "If not, then it will be difficult for SEs to retain customers to sustain the business," he adds. "SEs must strive to provide value-for-money otherwise they cannot survive in the tough business environment." Approximately 55 percent of DiD Hong Kong's revenue is derived from the company's corporate sensitivity training business. The other 45 percent comes from public participation and other organized school programs. C文件倉rporate training contributes 65 percent net profit margin to the company. "We are targeting 10 percent profit growth in the future in order to maintain the business as operating costs are also rising," Pang says. Rents and wages take up around 60 percent of the operating costs while franchise fees and office maintenance cost take up the remaining 40 percent. DiD Hong Kong is the licensee of the "DiD" brand, a social enterprise founded by Andreas Heincake in Germany in 1988. DiD has since spread to over 34 countries and 164 cities around the world. Diamond Cab (Hong Kong) Ltd Diamond Cab (Hong Kong) came about as if by happenstance, in the wake of misfortune that befell the family of the company's chief executive officer Doris Leung. Leung's mother was diagnosed with brain cancer in 2006 and became wheelchair-bound in 2007. Leung has to accompany her mother to the hospital for treatment, then back home. During the regular trips back and forth, Leung noticed that there existed a huge untapped potential for a legal, barrier-free taxi service to serve the needs of people who are wheelchair bound. On one hand, conventional taxi service and Accessible Hire Cars service provided by the Hong Kong Society for Rehabilitation are inconvenient and inflexible for people who are wheelchair-bound. The unlicensed, and therefore illegal van hire transportation services are more costly than conventional taxi services, and do not meet standards for safety and insurance. Leung solicited local, philanthropic venture organizations: Social Ventures Hong Kong, operators of homes for the elderly, taxi operators and seven private individual investors, persuading them to contribute HK$2 million ($258,000) as an initial investment in Diamond Cab (Hong Kong), in 2009. No barrier travel service The social enterprise currently maintains partnerships with two motor companies leasing six taxi licenses to operate the service. The company has a 24-hour booking hotline, provided by the Kowloon Taxi Owners Association. Diamond Cab (Hong Kong) currently operates six taxis that can accompany wheelchair-bound persons, to provide the transportation "to order" with 13 full-time and part-time, self-employed taxi drivers. After nearly four years of operation, the company's current income covers operating costs such as taxi license fees paid to the government, taxi license rent paid to taxi owners, the online booking hotline service, vehicle repairs, third-party insurance, office maintenance and salaries for staff. In other words, the company has reached break-even in its operations but is not earning profits. The social enterprise plans to pay back the initial investment to its individual and corporate investors in the coming two to three years. The only way to make that happen is for the company to expand its no-barrier taxi service into other services that provide additional revenue streams. That's the plan for next year. The company plans to launch the Diamond Leisure project, a no-barrier travel service that will involve hotel operators, travel agencies and Diamond Cab (Hong Kong) to provide no-barrier travel service to visitors and locals in Hong Kong (by providing the taxi transportation). The social enterprise also plans to launch taxi travel service for locals to visit entertainment venues such as cinemas and karaoke for those wheelchair-bound persons, enabling these people to take part in popular entertainment activities more easily. "We have worked very hard to build up our brand to tap more income from customers with high-spending power and advertising revenue from wheel chair manufacturers," Diamond Cab (Hong Kong) Chief Executive Officer Doris Leung tells China Daily. Leung has considered several channels which might enhance her company's income. Finding the solution is not easy. "Local banks consider the SE business model too risky. Banks are conservative by nature and prefer to offer business loans only to enterprises collateralized by properties or other business assets." "We prefer to elicit more financial support from aggressive social venture philanthropists to provide funding for further business expansion because they share our visions and can provide more insights to the company," Leung says. Contact the writer at oswald@chinadailyhk.com Social enterprises must strive to provide value-for-money otherwise they cannot survive in the tough business environment." Antony Pang DiD Hong Kong Chief Executive Officer We have worked very hard to build up our brand to tap more income from customers with high-spending power and advertising revenue from wheel chair manufacturers." Doris Leung Diamond Cab (Hong Kong) Chief Executive Officer存倉