The social enterprise as a vehicle to poverty alleviation: business models and earning strategies

Over the last decades, social enterprises have increasingly gained importance in the travel and tourism industry and they are revolutionizing the way business is done. Instead of maximizing profits for external shareholders, a social enterprise is an organization that applies commercial strategies to address society’s most pressing needs; thus creating sustainable solutions, that empower the underprivileged to independently lift themselves out of poverty. Social enterprises can be structured as a for-profit or non-profit, and may take different forms between these two poles (Ridley-Duff, R. J. and Bull, M., 2011). Professionals and researchers agree insofar as they argue that non-profit organizations are not self-sufficient due to the fact that they depend largely on donations. On the other hand, having the opportunity of reinvesting their own income, for-profit enterprises are not confronted with this problem. However, some businesses are to be found in neither end of the spectrum. These hybrid models combine elements from both forms (Elkington and Hartigan, 2008). The purpose of this paper is to explore different business models of social enterprises operating in the travel and tourism industry. The focus is on what motivates social entrepreneurs, which social needs are addressed, what are the approaches taken to improve them and what are the social enterprises’ income generating strategies to ensure their self-sufficiency.