1.1 ABOUT THE RESEARCH
This is our eighth annual report on the community business market, drawing on the findings from an unprecedented number of responses to our survey and in-depth interviews with community businesses. Together with our analysis of data from a wide range of sector and other external sources, it provides the most comprehensive picture yet of the nature and scale of the community business market.
The research was carried out by CFE Research with extensive input from Power to Change. This year we are making our findings available online in this new, more accessible, practical, and user-friendly way, which we hope you find interesting and useful.
Survey
The Community Business Market Survey was distributed in June and July 2022. We received 1,015 valid and complete responses from community businesses – nearly twice as many as last year (548).
This is a positive development demonstrating appetite in the sector to contribute to research. However, it comes with a note of caution about comparing data across years, as we cannot be certain whether any changes represent a true change in the market or are due to a large increase in the sample size.
Interviews
We interviewed 15 community businesses during July and August 2022 to enrich our insight on their experiences, hopes and needs, and capture some sense of the impact of external pressures on the sector, such as the cost-of-living crisis and rising inflation.
Market estimation
We also gathered data from a wide variety of internal and sector sources, and from further afield, to continue building our understanding of the size and structure of the market. You can find more detailed technical information about our approach in Section 5 and methods and download the full anonymised survey dataset.
Referencing
This webpage report has been written jointly by CFE Research and Power to Change.
Power to Change is the independent trust that strengthens communities through community business. We started life in 2015 and use our experience and evidence to bring partners together to fund, grow and back community businesses in England to make places thrive. We are curious and rigorous; we do, test, and learn. And we are here to support community business, whatever the challenge.
CFE Research is an independent not-for-profit social research company providing research and evaluation services to government departments, public sector agencies, education providers, and local and national charities. It specialises in education, employment and skills, helping its customers understand what works, in what context and why.
If you would like to reference this report, please use: ‘Community Business Market Report 2022, CFE Research and Power to Change (2022) www.powertochange.org.uk/market-reports/market-report-2022/‘
For further information or any questions about the research, you can contact Chloe.Nelson@powertochange.org.uk, Head of Impact and Learning at Power to Change, and John.Higton@cfe.org.uk, Research Director at CFE Research.
1.2 WHAT WE LEARNED ABOUT COMMUNITY BUSINESSES
Community businesses aim to make a difference to a wide variety of things that matter to their place and the people that live there. In their size, structure, services and staffing, they are as diverse as the communities they were established to serve.
Size of the market
Every two years, we use primary data from the Community Business Market Survey to measure market sentiment and secondary data (this year, from 12 sources) to estimate the population of community businesses operating in England.
This year our market sizing analysis estimates that there are 11,000 community businesses operating in England, with a total income of just under £1 billion. The estimated size of some sectors increased (notably housing, which doubled to 600) whereas some of the larger sectors decreased slightly (community hubs and arts centres/facilities). The whole sector appears to have shown resilience during the intervening Covid-19 pandemic.
The slight reduction in the number of community businesses has been accompanied by a dip in the total estimated market income to £959 million, a fall of 2%.
The estimated value of fixed assets owned by the sector from the market analysis in 2022 (£744 million) fell by 14% compared with 2020’s estimate of £870 million.[1] The extent to which this is a real difference or a consequence of using a different data source for fixed assets is unknown.[2] Our total estimate of 41,800 staff this year is 11% higher than the 2020 estimate (37,800). However, estimated volunteer numbers fell by 15% to 126,200.
You can find more information on our market sizing methodology, and a full breakdown of the data in the Technical Appendix. This year we are also sharing the market sizing model itself, so that the sector has access to it and there is transparency in our calculations. You can also find this in the Technical Appendix in Section 5.
Community business activities
To help build a picture of the overall shape and composition of the market, we gather information about the types of activities undertaken by community businesses. From a list of 27 different activities, community businesses are asked to select all those that describe what they do, and then to identify the one that best describes their main activity. We then group selected main activities into categories that we use for analysis and reporting.[3]
Categories
We sort community businesses into seven sector categories based on the main activity they report. These categories are:
- public-facing support services (31% of surveyed community businesses)
- venues (26%)
- retail and hospitality (14%)
- arts or culture (12%)
- economic or business services (9%)
- manufacturing, or production (6%)
- other (2%)
The proportion of surveyed community businesses that fall under public-facing support services increased by 10 percentage points from 2021. Public facing support includes:
- health and social care
- information, advice and guidance; employability support
- housing
- training and education
- youth and childcare services.
Until this year’s survey, venues (consisting of community hubs and village halls) had been the largest category of main activity.
Community business sectors
This chart shows the seven categories of activity, the types of activities within each category, and the number of community businesses that selected each activity type as their main one.
Base size = 1,015.
Main activity
Community hubs have persistently remained the most common type of community business for the eight years we have been surveying the market. In 2022, 25% (254) of surveyed community businesses selected community hub as their main activity.
All activities
Community businesses also tell us about all their activities. The most common of all community business activities selected were a community hub or facility (53%, 529 of 1,015 community businesses), training and education (31%, 316) and information, advice and guidance, and employability support (27%, 275).
Base size = 1,015.
Many community (76%) businesses said they had undertaken multiple activities at the time of completing the survey. For example, of the 316 community businesses providing training and education services, 47% also provide information, advice and guidance or support to build employability.
Spotlight: Community hubs
Community businesses reflect the multi-faceted needs of the local population, often bringing people together in physical spaces. The hub model continues to be an excellent way to serve multiple needs through offering a diverse range of services.
We’re open to people in the local community that don’t have anything or come from the very deprived areas of the town…
Ware Arts Centre
In this year’s survey, 529 community businesses (53% of 1,015 survey respondents) selected a community hub as one of their activities, and 254 of these selected it as their main activity.
Many of these 529 community businesses indicated that they also provide a broad range of public-facing support:
- 36% provide training and education (190 of the 529 community hubs)
- 33% provide information, advice and guidance or employability support (176)
- 26% youth services (140)
- 25% provide education or education support (133).
A third (34%) of these 529 community businesses also ran a café alongside their community hub.
Legal status
Community businesses use a variety of legal structures and governance approaches to ensure they are accountable to the people they serve. As their operating priorities differ from private sector businesses, they have more flexibility in legal structure, financial arrangements, and operating models. Of the 1,015-community business we surveyed, half are either a community interest company (CIC) (25%) or a charitable company limited by guarantee (24%), with the remainder adopting a variety of other structures.
Base size = 1,015.
Charitable companies limited by guarantee are typically larger organisations: 42% employ 11 or more staff (compared with 24% overall), and 44% report total incomes over £300,000 (compared with 24% overall).
Diverse communities, diverse leadership
Community businesses are owned by and accountable to their communities. This year, we wanted to increase our understanding about the diversity of the sector and the people who run, use, and benefit from it.
Diverse communities
Community businesses said that the groups that most use or benefit from their products and services are women and girls (91% of community businesses reported this group are ‘moderate’ or ‘high’ users or beneficiaries), young people (81%), older people (78%), and people who are economically or educationally disadvantaged (72%).
Base size = 1,015.
The groups with the highest proportion of reported ‘no use or benefit’ are people experiencing homelessness (29%), ex-offenders (22%), and refugees and migrants (19%). The high proportion of ‘don’t knows’ reported for LGTBQIA+, ex-offenders, and long-term unemployed implies that community businesses are least likely to know whether these groups use or benefit from these services.
Community businesses disproportionately operate in areas facing multiple disadvantage – 48% operate in the 30% most disadvantaged areas in England (IMD 1–3), and just 12% operate in the most advantaged areas (IMD 8–10).
Base size = 1,015.
Community businesses operating in high areas of disadvantage generally see higher usage of their products and services by people with certain lived experiences, as shown in the chart. Although there is an increase in the proportion of reported usage of community businesses operating in the most advantaged areas (IMD 10) this year, this is likely to be caused by the small number of responses from community businesses operating in those areas (34 of 1,015 community businesses).
Base size varies between 868 and 916.
Diverse leadership
Women and girls, older people (aged 60 and over), and minoritised ethnicities are the most represented characteristics in community business senior leadership teams (including their boards). Women and girls make up a majority on leadership teams in 55% of community businesses, people aged 60 or older in 32%, and minoritised ethnicities in 21%.
Base size = 1,015.
The high proportion of ‘don’t know’ responses suggests community businesses are least aware of whether their senior leadership are LGTBQIA+, long-term unemployed or ex-offenders. This may be because community businesses don’t collect this data or have access to secondary data about these groups.
Community business leadership tends to reflect the level of disadvantage faced by the community where they operate: 34% of community businesses located in IMD 1 (most disadvantaged) are run by leadership teams with a majority of people from minoritised groups, compared with only 7% in IMD 10 (most advantaged).
Base size varies between 928 and 991.
THE ANSTICE
Case study: Anstice Community Trust
When the Grade II listed Anstice Building in Madeley – one of the top 10% most deprived areas of the country – went into liquidation in 2014, three local women started a campaign to bring the building into community ownership.
There was a tremendous amount of support for it when it was at risk… Local people immediately started a passionate Save the Anstice campaign, attracting over 900 Facebook supporters in two weeks and lobbying local councillors for support.
When the Anstice was bought by Madeley Town Council, who worked with the Anstice Community Trust to renovate the building, a priority was making it fully inclusive to all of the community. The building is now a vibrant hub at the centre of the community, providing benefit to a range of local people. The centre has increased community pride, empowered local people, and reduced social isolation.
Footnotes
[1] Our market sizing analysis takes both the Community Business Market survey data and other secondary data to estimate the total fixed asset value for the community business sector. See the ‘Market Sizing’ section of the Technical Appendix in Section 5 for more detail. Note that we also report fixed asset value based on survey data only in Section 2.
[2] This year, we used median fixed asset data from Twine (https://twine-financial-dashboard.herokuapp.com/), hosted by the Institute of Community Studies to estimate the value of fixed assets owned by the sector. In previous years, we primarily used Power to Change grantee data. This data is no longer being collected. See the ‘Market Sizing’ section of the Technical Appendix in Section 5 for more detail.
[3] You can find the full survey in Section 5.