Sunday, March 31, 2013

How the 'Non-profit Non-loss' Model works


The ‘Non-profit, Non-loss’ business model introduced by Cameroon Agenda for Sustainable Development (CASD) involves three parties: A development organization such as CASD, a microfinance institution and a marginalized community with profitable business potentials.
 The development organization works with the identified community to design a project that generates income on one hand  (for-profit) and uses the profit to finance non-profit goals (like heath and social deliveries) for the community on the other hand. A micro-finance institution is then contracted to fund the project on the basis that the profit would be shared to refund the micro-finance, finance the charity aspect and sustain the implementing organization. It’s a win-win. The community spends its resources on a business that will return the resources in the form of social deliveries. The micro-finance recovers all its money with time and the implementing organization covers its costs.  The greatest secret of this approach is that, it can never fail since the consumers also have a stake in the profit. They therefore patronize the business without waiting for adverts.