At The Vanguard of Social Enterprise

In the first 12 months of business Vanguard Laundry Services has gone from strength to strength, writes Wendy Williams in this month’s Spotlight on Social Enterprise.

“Vanguard was a ridiculous idea,” jokes Luke Terry, the managing director of Vanguard Laundry Services.

But after one year in business the custom-built commercial laundry in Queensland’s Toowoomba region, which creates employment opportunities for people who have a lived experience of mental illness and struggle to secure employment, has proven that it works.

Since the social enterprise was officially opened by Prime Minister Malcolm Turnbull in January 2017 it has achieved rapid growth and gone on to have a significant social impact.

Employees have reported significant health and social improvements, supported by the increased access to personal, social and financial resources facilitated by their work at Vanguard.

During a Keynote Address in Toowoomba earlier this month Turnbull showcased Vanguard Laundry Services as a success story.

“Vanguard’s mission is to give people with a history of mental illness a job and an employment pathway,” Turnbull said.

“Luke [Terry] says that business is now thriving with 83 customers, up from one when it launched only a year ago. Of the 48 employees at Vanguard, 32 had a mental illness that had kept them out of the workforce for an average of five years.

“Research by Swinburne University found that after just one year, those workers were much less likely to rely on welfare. A quarter had withdrawn from Centrelink entirely. They were less likely to visit hospital and above all, 80 per cent said they simply felt better. That’s something the entire community here in Toowoomba should be very, very proud of.”

According to Terry, Vanguard is the result of a partnership between Toowoomba Clubhouse, an organisation dedicated to supporting adults with a lived experience of mental illness, and St Vincent’s Private Hospital, and was made possible when St Vincent’s offered the clubhouse a long-term nine year contract in return for building the facility.

“This all started when I was the CEO of Toowoomba Clubhouse,” Terry says.

“I’d spend a lot of time talking to people about making sure we were shifting our services in the right direction, and people would often say to me ‘we want what you have, we want a partner and we want a job’.

“I couldn’t help with the partner stuff and I was passionate about social enterprise, but I didn’t want to set up a dating agency social enterprise, but I could set up businesses that act as that first employer, and we know that there is stigma around employing people with mental illness.

“I was in love with the idea of social procurement. So we went out to our community and we said ‘give us a contract on anything and let us build a business around it’ because as a mental health agency we have a lot of experience in managing labour and working with our client groups.

“We got a contract to set up Ability Enterprises, so the running of 15 waste transfer stations, $3 million a year contract, it now employs 50 people, very successful. And then we went out into the community again and said give us a contract in anything else, and St Vincent’s Hospital said how about our laundry? We’re going to close our laundry in Toowoomba and we’ll have to send it all to Brisbane because there is no hospital grade laundry in Toowoomba, and so that’s where it started.”

Vanguard Laundry Services was established with more than $6 million in funding, finance and in-kind support provided by corporate sponsors including Westpac, Westpac Foundation, The Paul Ramsay Foundation, AMP, Ian Potter Foundation and local philanthropist Ian Knox.

The federal government also committed to providing $1 million to support the new service.

But Terry says when they opened their doors in January 2017, it was with just one customer.

“It was so grim,” he says.

“It was one big customer, don’t get me wrong, it got everyone excited, it was eight ton a week, but it wasn’t great, and it was like ‘are we going to make it through?’ and the staff were looking at me as if to say ‘what have you done, this cost a lot of money’, and it was a bit comical.

“We found it really hard for the first few months, because I think when we set up Vanguard, people including my wife, were going ‘you’re washing this much laundry, you’ve never washed anything before’, but the community could see that we were washing St Vincent’s stuff and then we had this careers centre that was operating inside that was starting to get some really good outcomes, and the business community eventually came on board.”

The organisation has since grown to have 90 customers, and is “growing by the day”.

The laundry also has an in-house Career Development Centre to support disadvantaged job seekers into sustainable career opportunities with local employers, and to provide training and career development.

Terry says they have been able prove a model that can sit alongside government funded programs.

“I am not against government funded programs, but I think that we are going to be in a world of pain in the future. We can’t continue funding all of the programs, every time there is a community in need,” he says.

“We need government funded programs but there is so much need in the community that I think what we are demonstrating with Vanguard is that we can get similar outcomes as mainstream mental health programs, and sometimes slightly better, from washing $2 million a year of dirty towels, sheets and pillow cases.

“Now I am not saying we should replace those programs with Vanguard laundries, but we could put Vanguard laundries on top and make sure there is opportunities for everyone… If we can find pockets of money and get some contracts in laundries and other things then we could really make Australia a beautiful place… [and] make sure no one gets left behind.”

Terry says he is “deeply in love” with the social enterprise model.

“I have run both sides of the fence, so I have run social enterprise programs and I have run mental health government funded programs, and I’m in love with this idea,” he says.

“I, like many of your readers, have sat in the room with four or five other mental health organisations fighting over the same dollar and really if we go home and think about it we’re sort of all doing the same thing.

“I’m in love with this thing where we can use trade in a productive way, that’s not competing with other business, because sometimes people think that’s the case, and we can run programs that can give the participants or consumers what they really want and I’m not having to go back and ask the government for money every year.”

He says he feels “liberated” that the social enterprise is self-sustaining.

“I think when I started running Toowoomba Clubhouse in 2009, after coming over from the UK, and it was a similar thing in the UK, we used to get three year government funding contracts, now we’re looking a six to 12 month funding contracts,” Terry says.

“So I just feel liberated, as to run our effective mental health programs and keep running our great staff, I’ve just got to find more laundry to wash.

“It is still hard, don’t get me wrong, it is still incredibly difficult but it is so much easier than having to argue in a room with all these highly paid execs saying ‘oh we can do it better than this, we’ve got experience in this area’, and I’m like actually, this is great we can run the program.”

Vanguard has also teamed up with CSI Swinburne to undertake a unique evaluation partnership which will evaluate the mental health and wellbeing impacts of the social enterprise.

The first year impact report is due to be released next week.

Terry says working with Swinburne and gathering an evidence base was one of the most interesting parts of the project.

“Now we can say to the mental health community we have an evidence base,” he says.

He says one of the key impacts the program has had is causing a drop in Centrelink participation among employees.

They have also been able to show a direct link between the programs and savings for the local community.

“For me, the most fascinating thing in there, that I absolutely love, is that the only stakeholder we didn’t get on board is the state government, because every time we visited the state government, they said employment is a federal issue. And now we can show the direct link of the savings we have on the local community, we can show the direct link on the local saving we have on housing,” Terry says.

“I’m very excited around how this report shows it makes an impact on local government, state government, federal government, this stuff is everyone’s responsibility and if we can work together we can make our communities safer, we can make our communities stronger, we can make sure that our communities have no one left behind and that is really exciting for me.”

The social enterprise is also having a positive impact on the health of its employees including causing a drop in smoking rates.

“This is brilliant and the reason for me that this is so brilliant is because people with lived experience of mental illness are dying in their 50s versus the 80s for the rest of us. We know some of those links are medication related and smoking related, and weight related, and what we’re finding is people are coming to Vanguard and they’ve got something to do so they’re are smoking less,” Terry says.

“The smoking rates for people with lived experience of mental illness are 70 per cent, versus 14 per cent for the rest of the nation. So I’m someone that gets a bit upset every time we raise the cost of cigarettes in the country because we’re not putting any of that money into programs, and so with St Vincent’s helping us with quit smoking programs at Vanguard directly and us focusing on that, we can maybe help with that life expectancy and that’s why, with our research, we need to look at this 10 years out and look at the difference around if it changes life expectancy.

“This was one of those strange ideas I had at the beginning where what I’m passionate about is, can we link physical health indicators and the life expectancy rates together with getting a job? And, I think we can, I think we can show it makes a really big difference.”

Terry says while the first year has been a success, it has not been without its challenges.

“We’ve learned a lot,” he says.

“But any startup has its problems. And we’ve had what I would call start problems, but to reach pretty much sustainability in that first 12 months, to have the employees that we have and to go from one customer to as many as we have is really exciting.

“It’s not without its pain. Vanguard was a big expensive project, and we were trying to prove something different, and we’ve still got a long way to go. We need to work out what the participation pathways are, what corporates are going to want to work with us to do this again. We still talk to some corporates who go ‘you haven’t followed through with it yet’, and they are people who could give us contracts right now, so we need to work with those people to help build their confidence.”

He says Vanguard started as a “ridiculous idea” and he never would have imagined it would get this far.

“We’re a laundry that is going to wash 20 tons a week and we’ve never washed laundry before. We’ve got no experience in commercial laundry, we’ve never built a shed that big before, I haven’t really done the washing before. It was a funny idea, but I think people have got on board with that which I think is quite cool,” Terry says.

“For me it is quite delightful that we’ve come through. We’ve still got a lot of business challenges, it is not easy, I don’t want people to think ‘oh lets just do laundry’. We’ve all been through that phase in the social enterprise sector where everyone went and built cafes, I hope that doesn’t happen with laundries. But it is about finding something in your community that you can fill a gap with.”