In the late 70s of the last century the pace of economic growth was reduced, and unemployment grew. The social model of countries is insufficient to ensure benefits to all, and it becomes impossible to overcome growing inequality and social exclusion. This situation dictated expansion of some voluntary organizations that gradually become social enterprises.
In 2002, the British government published the following definition in its official document "Social enterprise is a business with leading social objectives whose surplus is reinvested back into the business or in the community rather than be guided by the need to maximize profits for the owners of capital or shareholders."
Social enterprises have all the hallmarks of traditional enterprises, producing goods and services; use inputs that have a clear cost; are autonomous; take significant level of economic risk.
Their business has a social aspect: pursue a clear social purpose; serve the public or a particular group of people in disadvantaged social position; do not seek to maximize profit to distribute it among the participants in the capital of the enterprise.
The most important feature of social entrepreneurship is pronounced social impact, which is reflected in the use of revenue generated to support target groups; participation of the target groups in business / employment creation / and provide services unattractive for businesses to disadvantaged people; creating opportunities for professional and social integration; create social value and saving social costs.
The social economy is both part of the real economy and of the civil society in which individuals and legal entities engaged in business activities in the public interest and reinvested earnings to achieve social goals.
The social economy includes all economic activities of enterprises, mainly cooperatives, associations and societies for mutual aid, whose ethics follows the following principles: putting public service before profit; autonomous management; democratic decision-making; advantage of people and work over capital in distribution of resource.
The model of social economy leads to a number of social benefits: integration and employment of disadvantaged people; contribution to the process of social inclusion of disadvantaged people; contribute to more balanced use of local resources; new jobs for disadvantaged people - minorities, single women, people with disabilities and others who are excluded from the ability to generate income.
The model of the social economy makes economic effect that results in saving public money for social benefits and saving additional funds to compensate the social costs of long-term unemployment.
In Bulgaria there are several models of social enterprises:
1. Model for creation of employment and workforce development - economic logic of the venture is based on the ability to create jobs for disadvantaged people. This model is associated with the so-called. "Sheltered employment" where social enterprise employs people with disabilities.
2. Entrepreneurial model where social enterprise is an intermediary between the disadvantaged and the market. In this model, in the form of occupational therapy, people with disabilities participate in the production of products for which the social enterprise seeks market and is committed to marketing and distribution.
3. Model of direct service - this model is most closely associated with social service providers. In his social enterprise provides social services against payment to external customers and at the same time is a provider of social services for its members and the payment becomes a contract with the municipality or the state. It is important to note that in this model, social enterprises develop the same services, but directed to different users and clients.
Social enterprises in Bulgaria exist as companies, cooperatives and companies with non-profit purpose. They all have important social outcomes for vulnerable groups. The most popular form is NGOs.