Good Spender Closes As Sector Looks to Social Procurement
18 January 2018 at 8:42 am
Australia’s first online marketplace exclusively for social enterprise has closed as the sector looks to social procurement as the “next big opportunity”.
Good Spender, a partnership between Social Traders and Australia Post, announced at the beginning of the year it had ceased trading following “a strategic review of Social Traders”.
The new strategy will see the not for profit moving away from connecting social enterprises with consumers in favour of “taking on the next challenge to unlock the massive potential of social enterprise procurement by connecting ST certified social enterprises with business and government buyers”.
In a statement to its supporters, Good Spender said it was “with regret” it was announcing the closure of the initiative, but said it had successfully raised the visibility and awareness of social enterprise to Australian consumers since launching.
Social Traders managing director David Brookes told Pro Bono News the initiative had achieved what it set out to do.
“Good Spender was an initiative that we went into in partnership with Australia Post back in 2014 and it was an initiative designed to raise the profile of social enterprise in Australia, particularly to Australian consumers, and it has done its job,” Brookes said.
“It has really been quite successful, and has played an important role in raising the profile of social enterprise in Australia, providing an online platform that has connected over 100 social enterprises with consumers, and these enterprises received something like 1.3 million web page hits and a platform to sell their 11,500 products, so it has been successful.
“It has also played a really valuable role in building the online marketing capability of those social enterprises, most of which now have their own online stores, which was not the case just three to four years ago, and there are also more online platforms available for social enterprises to reach consumers.”
Brookes said he did not believe it was leaving a gap in the market.
“Australian consumers can still purchase from social enterprises online by going directly to the enterprises online stores, or searching another website for example goodsmiths.org, Thread Harvest, the Good Xmas Trail, there are lots of opportunities for consumers now to buy from social enterprises online,” he said.
He said if they were to do it again they would not do anything differently.
“Social enterprise in Australia is on the rise and the market has matured significantly over the last three or four years and the Good Spender initiative has been part of that,” he said.
“I think a lot of these sorts of things are often not intended to be around indefinitely, they serve an important role and we were very fortunate to have the resources and capability and backing of Australia Post to be able to launch this.
“They built the platform, they provided considerable support around the marketing of the initiative as well, and from Social Traders perspective it was a really valuable partnership with Australia Post that enabled Good Spender to realise its initiative.”
An Australia Post spokesperson told Pro Bono News they were “proud to have supported Social Traders and their Good Spender platform for the last four years”.
“We look forward to seeing how Social Traders will evolve and how we can support their new program of work,” they said.
Liz Grady, partnerships and communications manager at social enterprise Scarf, one of Good Spender’s listed sellers, told Pro Bono News Good Spender had been a “wonderful vehicle” for them to connect with new socially-minded customers and provide awareness for the sector as a whole.
“Social Traders did a great job of paving the way for this kind of socially-conscious buying and we hope the new initiative, Buy Social Impact, builds on this further and broadens the group of people that choose to buy in a socially conscious manner,” Grady said.
Over the next three months, Social Traders is set to transition to a new business model, working with corporate and government buyers to make changes to their procurement processes and link social enterprises to new contract opportunities.
Brookes said the space had evolved significantly over the last few years and the new strategy reflected that.
“I think there has been significant change and it has been positive change,” he said.
“I think here in Australia, and probably most notably in Victoria where the state government is playing a lead role in creating opportunity with its social enterprise strategy which was launched in February last year, I think we are moving forward in a policy area and there is recognition of social enterprise as a legitimate form of business in our economy and in our community.
“The Victorian government as part of its strategy recently undertook a Map for Impact project on the Victorian social enterprise sector and that project reiterated the significant economic and social impact that social enterprises are contributing. Just in Victoria it is $5.2 billion of economic impact, providing 60,000 jobs.
“So I think for me, there is greater recognition of social enterprise than there was four or five years ago, and you now have an emerging qualitative policy environment, here in Victoria and in other states.”
He said Social Traders now believed the biggest opportunity for social enterprise growth was to unlock the “massive potential of social enterprise procurement”.
“Our view is that the biggest opportunity for growth and development for social enterprise is really linking the mainstream business sector and government with social enterprise through the way in which they procure their goods and services,” Brookes said.
“This view is supported by national research that we conducted in conjunction with the Centre for Social Impact at Swinburne, which found that social enterprises across the country nominated social procurement – which is the buying of goods and services from business and governments – has the biggest opportunity for their growth, and so to unlock that potential Social Traders as an intermediary organisation wants to connect those social enterprises up to those social procurement opportunities.
“That’s where we believe we can maximise our impact as an organisation.”
Brookes said he believed the potential for the social enterprise sector was “massive”.
“Public sector and the private sector spend billions of dollars every year on procurement, in terms of the goods and services that they need to run their operations. And what we’re saying, and this is already happening, we’re seeing it in Indigenous areas and we’re starting to see it in the social enterprise area, that government can open up their procurement, open up their supply chains to provide access to social enterprises which provide significant and meaningful training and employment opportunities for disadvantaged people,” he said.
“Here in Victoria for example the government over the course of the last 12 or 18 months has already made the move requiring 3 per cent of contracts to be open to social enterprises and Indigenous businesses, and so we are starting to see government policy change in this area and we’re also seeing the private companies actively looking at way in which they can integrate social outcomes into their purchasing and procurement decisions.
“In terms of social traders over the next four years, by 2021, our goal is to help facilitate $105 million in social enterprise procurement spend which will generate 1,500 jobs for disadvantaged Australians. We believe that that is an ambitious but an achievable target for our organisation.”