How are community businesses improving the wellbeing of local communities?

Download the briefing and full review

As part of Power to Change’s open call for research, we funded the What Works Centre for Wellbeing to review of all the available evidence on how community businesses may contribute to wellbeing. 

What is community business?

Community businesses are locally rooted, community-led, trade for community benefit and work to make places better. They can take many forms, from pubs to libraries; shops to bakeries; and swimming pools to solar farms. 

Key findings

Three key ways that community businesses work to improve community wellbeing are by engaging with the local community, developing the skills of local people, and strengthening community infrastructure. These processes nicely reflect the values found at the heart of community businesses.

1. Engagement with the local community is vital to community businesses’ success. It allows businesses to adapt and shift to meet local needs. Outside of the services they run, these businesses provide opportunities for local people to get involved. This could be as a customer or beneficiary, as a volunteer, or a member of staff. Getting involved can reduce social isolation and enhance social relations.
2. Community businesses are great at focusing on developing the skills of local people. This often leads to increased confidence in communities – improving individual wellbeing and employment prospects which lead to a stronger local economy. 
3. Community businesses operate services or premises which are often not commercially viable. These services provide vital lifelines to communities. Through strengthening community infrastructure in this way, community businesses work to improve local neighbourhood environments, making them better places to live.

The review highlights that across sectors, regions, and services run by community businesses, wellbeing outcomes are prominent. Key outcomes at a local level include community wellbeing, community involvement, enhanced neighbourhood environment, enhanced social relations and reduced social isolation.

The review also found significant risks posed to community businesses. These may negatively impact community wellbeing. These focus around capacity and sustainability of businesses: recruitment and management of staff and volunteers, management and transfer of assets, availability of funding, and conflicts between obtaining funding and the values of the community business. These factors negatively influence wellbeing outcomes by restricting or stopping the community business from running, preventing the opportunity to achieve the outcomes it may when it is functional.

Why do we look at wellbeing outcomes?

By understanding how community businesses could improve wellbeing, we can better understand the overall influence that a business is having in an area – whether intended or not. This helps to make the case for community business – showcasing why they’re important and what they offer. This evidence review confirms what we know about community businesses anecdotally; they do have a positive impact on community wellbeing. 

Now more than ever, when community connection is needed to maintain our spirits during lockdown, community businesses are facing uncertain times ahead. The impacts of this, whilst entirely unknown at this point, may ultimately influence the wellbeing of local communities. If you’re able to support your local community businesses during this time, do. Help to keep them running so the community can continue to reap the wellbeing benefits after COVID-19.