Harvard Case - Yangon Bakehouse: A Social Enterprise in Myanmar
"Yangon Bakehouse: A Social Enterprise in Myanmar" Harvard business case study is written by Howard Thomas, Sheetal Mittal. It deals with the challenges in the field of Social Enterprise. The case study is 16 page(s) long and it was first published on : May 10, 2017
At Fern Fort University, we recommend that Yangon Bakehouse (YB) pursue a hybrid growth strategy focused on social innovation and sustainable business models to expand its impact while ensuring financial sustainability. This strategy will involve leveraging YB's existing strengths in social entrepreneurship, community development, and ethical supply chains to create a circular economy model that benefits both the company and the local community.
2. Background
Yangon Bakehouse is a social enterprise in Myanmar that aims to empower women and create sustainable livelihoods through baking and food production. Founded by a group of social entrepreneurs, YB provides training, employment, and microfinance opportunities to women in underserved communities. The company's mission is to create a positive social impact while also generating profits.
The case study focuses on YB's challenges in scaling its operations and achieving financial sustainability while maintaining its social mission. The company faces issues like limited access to capital, competition from established bakeries, and the need to adapt to changing market dynamics.
3. Analysis of the Case Study
Strategic Analysis:
- SWOT Analysis:
- Strengths: Strong social mission, dedicated team, established brand recognition, positive community impact, access to local ingredients.
- Weaknesses: Limited capital, lack of formal business structure, reliance on donations, potential for operational inefficiencies.
- Opportunities: Growing demand for bakery products in Myanmar, untapped potential for expansion into new markets, potential for partnerships with NGOs and government agencies, increasing awareness of social enterprises.
- Threats: Competition from established bakeries, potential economic instability, fluctuating ingredient prices, regulatory changes.
Financial Analysis:
- YB currently relies heavily on donations and grants, which makes it vulnerable to funding fluctuations.
- The company needs to develop a more sustainable financial model that generates consistent revenue and profits.
- Exploring options like impact investing, social impact bonds, or social finance could provide access to alternative funding sources.
Marketing Analysis:
- YB has a strong brand identity rooted in its social mission.
- The company needs to develop a comprehensive marketing strategy that targets both socially conscious consumers and potential investors.
- Utilizing social media platforms and partnerships with NGOs can help increase brand awareness and reach a wider audience.
Operational Analysis:
- YB's current operational model is not scalable.
- The company needs to implement efficient production processes, improve inventory management, and streamline distribution channels.
- Investing in technology and automation can help improve operational efficiency and reduce costs.
Social Impact Analysis:
- YB has a significant positive impact on the lives of women in Myanmar.
- The company needs to develop a robust social impact measurement framework to track and quantify its impact.
- This data can be used to attract investors, demonstrate value to stakeholders, and improve program effectiveness.
4. Recommendations
1. Develop a Hybrid Growth Strategy:
- Focus on Social Innovation: YB should invest in developing innovative products and services that address specific social needs, such as providing nutritious food for vulnerable communities or creating sustainable packaging solutions.
- Implement Sustainable Business Models: YB should explore circular economy models, such as using local and organic ingredients, reducing waste, and creating partnerships with local farmers.
- Expand into New Markets: YB can expand its reach by targeting new geographic markets, developing online sales channels, or partnering with existing retail outlets.
2. Secure Sustainable Funding:
- Impact Investing: YB should explore impact investing opportunities to attract investors who are interested in generating both financial and social returns.
- Social Impact Bonds: YB can partner with government agencies or NGOs to create social impact bonds that provide funding based on achieving specific social outcomes.
- Social Finance: YB can explore social finance options, such as crowdfunding or community bonds, to raise capital from a wider pool of investors.
3. Enhance Marketing and Brand Building:
- Targeted Marketing: YB should develop a targeted marketing strategy that focuses on reaching socially conscious consumers and investors.
- Social Media Engagement: YB should leverage social media platforms to share its story, connect with customers, and build a loyal following.
- Strategic Partnerships: YB can partner with NGOs, government agencies, and other businesses to expand its reach and increase brand awareness.
4. Improve Operational Efficiency:
- Process Optimization: YB should implement lean manufacturing principles to streamline production processes, reduce waste, and improve efficiency.
- Technology Adoption: YB should invest in technology and automation to improve production efficiency, inventory management, and distribution.
- Strategic Sourcing: YB should develop a strategic sourcing plan to secure high-quality ingredients at competitive prices.
5. Strengthen Social Impact Measurement:
- Develop a Framework: YB should develop a robust social impact measurement framework to track and quantify its impact on women's empowerment, community development, and environmental sustainability.
- Collect Data: YB should collect data on key metrics, such as the number of women trained, jobs created, and income generated.
- Share Results: YB should share its social impact data with stakeholders to demonstrate its value and attract investors.
5. Basis of Recommendations
These recommendations are based on the following considerations:
- Core Competencies and Consistency with Mission: The recommendations align with YB's core competencies in social entrepreneurship, community development, and ethical supply chains. They also support the company's mission to empower women and create sustainable livelihoods.
- External Customers and Internal Clients: The recommendations address the needs of both YB's external customers (consumers and investors) and its internal clients (employees and beneficiaries).
- Competitors: The recommendations help YB differentiate itself from competitors by focusing on social innovation, sustainable business models, and a strong social impact.
- Attractiveness ' Quantitative Measures: The recommendations are expected to improve YB's financial performance, increase its social impact, and enhance its long-term sustainability.
- Assumptions: The recommendations assume that YB has a dedicated team, a strong social mission, and a commitment to continuous improvement.
6. Conclusion
By implementing these recommendations, Yangon Bakehouse can achieve a balance between its social mission and financial sustainability. The company can leverage its strengths in social entrepreneurship, community development, and ethical supply chains to create a sustainable business model that benefits both the company and the local community. This approach will allow YB to scale its operations, expand its impact, and become a leading example of a successful social enterprise in Myanmar.
7. Discussion
Alternatives Not Selected:
- Focus solely on financial growth: This approach could lead to neglecting YB's social mission and alienating stakeholders who value its social impact.
- Remain solely reliant on donations: This approach makes YB vulnerable to funding fluctuations and limits its ability to scale its operations.
Risks and Key Assumptions:
- Market Volatility: The recommendations assume that the demand for bakery products in Myanmar will continue to grow. However, economic instability or changes in consumer preferences could impact demand.
- Competition: The recommendations assume that YB can successfully differentiate itself from competitors through its focus on social innovation and sustainable business models. However, intense competition could make it challenging to gain market share.
- Regulatory Changes: The recommendations assume that the regulatory environment in Myanmar will remain supportive of social enterprises. However, changes in government policies or regulations could create challenges for YB.
8. Next Steps
Timeline with Key Milestones:
- Year 1: Develop a hybrid growth strategy, implement social impact measurement framework, explore impact investing opportunities, improve operational efficiency.
- Year 2: Launch new innovative products or services, expand into new markets, secure funding through impact investing or social impact bonds, strengthen marketing and brand building efforts.
- Year 3: Evaluate the effectiveness of the implemented strategies, refine the business model, and continue to scale operations while maintaining a strong social impact.
By taking these steps, Yangon Bakehouse can position itself for long-term success while making a meaningful contribution to the lives of women and communities in Myanmar.
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Case Description
Based in 2017, the case describes the entrepreneurial journey of a social enterprise (SE), Yangon Bakehouse (YBH), in Myanmar. Established in 2012, YBH's primary objective was to address the socio-economic development issues of disadvantaged women in Myanmar. The enterprise was based on a self-sustaining model, and ran a revenue-generating restaurant and catering business to help support its social mission. YBH recruited minimally educated women who lacked stable income for a seven-month multiskilling training programme that provided culinary skills for employability, and life skills related to healthcare and financial decision-making. The apprentices were also assisted in securing placement across cafes, restaurants and bakeries. The restaurant and catering business served a dual purpose by providing on-the-job training in a practical setting, and generating income to sustain the training program. The enterprise was a success, and by 2017, YBH had managed to train and place 91 women. Additionally, it ran two kiosks, one café, a centralised kitchen, a training centre and an office. However, sustaining this growth was proving to be a challenge given the highly skewed real estate market, restrictive loan policies, and lack of legal recognition of SEs in Myanmar. Furthermore, with three of its four partners' being expatriates, the longevity of the enterprise was under question. Would YBH be able to transition to local leadership and management? Most importantly, would the social enterprise model continue to be relevant in the changing Myanmar?
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