What Is a Purpose-Driven Business? STEP-BY-STEP GUIDE TO BAKING PURPOSE INTO YOUR BUSINESS (EVEN IF YOU ARE A BEGINNER)
I hope you have a cup of tea in hand because today we are going to talk about a heart-warming topic that I love: What is a purpose-driven business? (And how to bake more purpose into your business).
If you have been reading my blog, you know that I love to teach other passionate entrepreneurs on how to start and build a purpose-driven and profitable business.
I derive a lot of joy from seeing others getting started and winning in the business world.
However, there is something else that is bigger than that that drives me to continue putting more time into this blog (let’s face it, it is hard work to build a meaningful blog) – and that is the idea of purpose-driven businesses or social entrepreneurship.
STEP-BY-STEP GUIDE TO BAKING PURPOSE INTO YOUR BUSINESS (EVEN IF YOU ARE A BEGINNER)
(You can click on the links below to jump over to a particular session)
- Business as a force for good
- What is a purpose-driven business?
- Does purpose-driven business have to be a charity or non-profit?
- Why should you bake purpose into your business? Here are 6 solid reasons.
- Is it only for big corporations?
- How to add purpose into your business? Here are 9 ways.
- The Dos of starting a purpose-driven business. Here are 6 Dos.
- The Don’ts of starting a purpose-driven business. Here are 4 Don’ts.
- Final food for thoughts. With an inspiring quote from Margaret Weis.
- How can I learn more? Recommended reading to dive deeper.
Business As a Force For Good
I believe businesses can be unstoppable forces for good. Sure, businesses need to make profits to exist, but that doesn’t mean they should not make a huge difference in the World at the same time.
I believe that purpose-driven businesses is the future of business.
So in this blog post, we will cover what is a purpose-driven business and 6 solid reasons why you should bake purpose into your business. Plus, we will discuss why purpose-driven business is NOT privileged only for big corporations – it is actually something YOU can start today.
And, I will share with you 9 ways for you to bake purpose into your business (even if you are just starting out). Plus, we will talk about the dos and don’ts of starting a purpose-driven business. Last but not least, some ways for you to dive deeper into this topic.
Baking purpose into your business is not just some touchy-feeling idea, but it is actually very strategic and is an excellent way to build a business and make a difference in the World at the same time.
What is a Purpose-Driven Business?
OK, first thing first. You may have heard of the term “purpose-driven business” before. But, exactly what is a purpose-driven business?
Passion vs Purpose
Passion is about finding yourself. It is about following our interests. Sometimes, we fulfill that part of our lives with hobbies. In other cases, we end up doing what we love for work, and it can lead to very successful businesses or careers. While many of us may find our passions and build successful businesses or careers that we enjoy, not all of us find purpose in the work.
Purpose is about losing yourself— in something bigger than you. It is about wanting to make a difference and do for others—to help, to give, to serve. It is the legacy you are going to leave behind.
Ideally, you want your business to fulfill both your passions and your purpose.
Purpose-Driven Business – Definition
A purpose-driven business is a business that not only focuses on making profits, but also focuses on making a difference at its core.
It’s about doing your soul’s purpose work, be it creating amazing and functional products or providing top-notch services, while doing that work for an important cause.
For example, perhaps there is a cause in the World you care deeply about and you want to become part of the solution. Say, you care about environmental issues so you decide to start a blog on how to live an environmentally-friendly lifestyle. While doing that, you donate parts of the proceed towards environmentally-driven non-profits.
May be you care about the rising medical expenses in your country and you decide to start a business to teach others about healthy eating and alternative natural therapies. During your spare time, you also volunteer at the local community to teach others the same topic.
Or perhaps there is a group of people in the society you want to help the most. For me, I care about education for underprivileged children, so I donate parts of my business revenues to build schools and support educational programs in developing countries (see my Giving Initiatives).
To put simply, a purpose-driven business uses its business as a force for good and as a platform to help the cause it cares about.
Does Purpose-Driven Business Have to Be a Charity or Non-Profit?
One of the biggest misconceptions is that a purpose-driven business has to be a charity or a non-profit.
Contrary to common beliefs, being a purpose-driven business does NOT mean you have to be a charity, or a social enterprise, or even a not-for-profit.
It simply means that, at your core, you are using your business to achieve aims beyond the bottom line and as a force for good.
In other words, you can be a for-profit and still be a purpose-driven business.
Why YOU Should Bake Purpose Into Your Business?
There are many wonderful reasons why you should bake purpose into your business. Below I have listed 6 solid reasons. Let’s take a closer look at each of these reasons and see which ones resonate with you the most.
(1) It Brings You True Happiness
As Mark Zuckerberg shared in his May 2017 Harvard commencement speech, “purpose is what creates true happiness.”
How Does This Relate To You?
If you’ve read this far, my guess it that you are looking to start a business (or a blog) that not only fills your wallet but also your heart.
So, taking it from Mark Zuckerberg, starting a purpose-driven business may just be the answer you are looking for.
(2) It Gives You More Motivated and Engaged Employees
A recent Harvard Business Review study found that employees who derive meaning from their work, report almost twice the job satisfaction and are three times more likely to stay with their organization to fuel business success.
A study by PwC also found that Millennials who have a strong connection to the purpose of their organization are 5.3 times more likely to stay.
As you can see, having a purpose-driven business can give your employees deeper meaning from their work, therefore, helping them to stay motivated and engaged. In return, your company will also have lower employee turnover rate. And, you are also likely to attract better talents.
How Does This Relate To You?
May be you are just starting out and you are not thinking about hiring any employees yet. However, just knowing that your purpose-driven business will likely help you attract better talents and have more motivated and engaged employees down the road is probably reassuring.
(3) It Gives You Better and More Loyal Customers
In this cut-throat competitive world for profits, having a business with purpose allows you to stand out and becomes a secret weapon.
According to New York Times bestselling author Simon Mainwaring, 91% of consumers would switch brands if a different one was purpose-driven and had similar price and quality.
Customers view purpose-driven brands as being more caring and, as a result, are more loyal to them. Cone and Porter Novelli consumer research showed that 67% of people feel companies with a purpose care more about them and their families. 79% said they’re more loyal to purpose brands, and 73% said they would defend them. Another 67% said they are more willing to forgive such a company for a mistake.
As you can see, not only does having a strong purpose engage employees, it also helps attract better and more loyal customers.
How Does This Relate To You?
We all want to have better and more loyal customers, and starting a business that is purpose-driven can give you a competitive edge.
And, this is true no matter what size your business is – a solopreneur business, a small business, or a huge corporation, the same principle applies.
(4) It Gives Better Business Performance
With more motivated and engaged employees, and better and more loyal customers, it is not surprising that purpose-driven business also have better business performance.
Recent analysis of purposeful companies by the Corporate Board/EY Global Leadership Forecast has the most compelling financial evidence – suggesting that purposeful companies outperform the stock market by 42%.
As you can see, purpose-driven businesses also have better business performances.
How Does This Relate To You?
May be you are just starting out and you have no intentions of ever making your company publicly-traded. That is totally fine! But knowing that purpose-driven businesses tend to have better business performance is probably reassuring.
(5) IT POTENTIALLY GIVES YOU TAX-BREAKS
Baking in some sort of social give-backs in your business can potentially give you some tax-breaks.
Tax laws are complicated and can change from time to time, so please consult with your tax advisor on this point.
(6) It Helps You Make Tough Decision
This is a big one.
When you are clear on your purpose, it helps you to make tough business decisions. To demonstrate this point, I want to site a story about Starbucks from the article Why Purpose Matters:
The StarBucks Story
“Two years before opening stores in Japan in 1996, Starbucks asked some consultants for advice. At the time smoking at coffee shops were the norm in Japan; non-smoking coffee shops didn’t exist. As a result, the consultants advised Starbucks to allow smoking in the stores if they wanted to succeed.
What would you do if you were the CEO of Starbucks?
They had a tough decision to make, but they had a purpose-inspired framework to help them. Recall that an essential element deeply connected with their purpose was their passion for coffee.
Starbucks prided themselves on the wonderful aroma of coffee in their stores. Imagine if people were smoking in the stores… The smoke would wipe out the coffee aroma.
Starbucks ended up opening non-smoking stores in Japan, contrary to what the consultants advised. If you’ve visited Tokyo in recent years, you’ve probably seen a lot of Starbucks coffeeshops. They have a big footprint and have significantly changed the coffee scene in Japan.”
How Does This Relate To You?
Running a sustainable and successful business is no easy task. There’ll inevitably be many difficult decisions to make. And having a clear purpose, gives you a guiding star when you have to make those tough decisions down the road.
It’s Not Just for Big Corporations
Now that you understand what is a Purpose-Driven Business and why starting a purpose-driven business is not only good for your heart but also for your wallet, are you ready to dive right in?
Having purpose baked into your business is something you can do even when you are just starting out. And, it is NOT something that is only privileged for large corporations.
In fact, everyone can use his/her business as a force for good and make a difference in this World.
A few years ago, I came across this short poem below, and I think it has beautifully demonstrated this point.
How To Change The World?
(By an unknown monk 1100 AD:)
“When I was young, I wanted to change the world.
I found it was difficult to change the world,
so I tried to change my nation.
When I found I couldn’t change the nation,
I began to focus on my town.
I couldn’t change the town and as an older person,
And I tried to change my family.
Now, as I’m old,
I realize the only thing I can change is myself,
I realize that if long ago I had changed myself,
And I could have made an impact on my family.
My family and I could have made an impact on our town.
Their impact could have changed the nation,
and I could indeed have changed the world”.
We All Have the Power
We all have the power to change the world and you are never too “small” to make an impact!
Dream big, start small, act now. Pour your heart into something you believe in and start a business that serve the people you most care about. With that, profits will follow and you can have a business that not only fills your wallet but also truly fills your heart.
Below, I’m gonna share with you 9 ways to actually add more purpose into your business, so you can get started today.
How To Add Purpose Into Your Business?
When it comes down to it, creating businesses that take on a single or multiple causes is one of the most important things we can do as passionate entrepreneurs.
We are living in this day and age that with a laptop, the internet, your passion and your heart, you have the opportunity to truly make a difference in this World, all the while earning soulful abundant money.
So, below, let’s talk about 9 ways you can easily add purpose into your business today.
(1) DONATE A PERCENTAGE OF YOUR TOTAL SALES/PROFITS
Donating a percentage of your total sales or profits to a cause or non-profit that you care about is a simple yet powerful way to get started.
Depending on your profit margin, you may choose to donate a percentage based on your total sales or your profits.
This is what I have been doing with my business. And thanks to all my customers, over the years, together we have donated and built 3 schools for underprivileged children and have been supporting women entrepreneurs in developing countries. Check out our social missions here.
This is something you can set out to do today!
Think of the causes and non-profits you want to support and set a goal to donate a certain percentage of your total sales or profits towards that cause/non-profits.
Don’t feel pressured. When you are just getting started, your business may not be bringing in too much sales or profits yet. However, please know that it is not about the absolute amount. It is about just getting started in giving!
As your business continue to flourish, you can contribute more.
(2) RUN TIME-BOUND PROMOTIONS WHERE A PORTION OF PROCEEDS GO TO CHARITY
If you’re just starting out and feel that donating a fixed percentage of your total sales or profits may be too big of a commitment, you can start off with running time-bound promotions where a portion of your proceeds go to charity or non-profits.
For example, you may be launching a new eBook or an online course. Within the first 3 days of your launch, you can donate 15% of your sales to charity. Or, you can pick a certain day of the month, say the 15th of each month where you will donate 10% of your sales towards a non-profit. You get to set the rules.
This is a great way to add purpose and giving into your business. Moreover, when communicated right, this is also an excellent way to drive sales.
(3) GIVE YOUR PRODUCTS OR SERVICES
Giving money is usually the first thing we think about when we want to bake purpose into a business. However, depending on what your business is, giving of your products or services can also be a great way to add purpose into your business and make a big difference. Let’s look at a few scenarios.
Let’s say you are a blogger about personal finance and you have just published a book. You can give free copies of your book to your local library. Or you can do a charity book sale where you give out your books for donations. And the money goes to support a charity of your choice.
Or may be you run a clothing shop online. Perhaps you could outfit unemployed single moms who are trying to interview for a new job. Or perhaps there are some local families whose kids could really use a couple of awesome outfits to make them feel great at school.
At the end of the day, adding purpose to your business comes down to two major things: creativity and resourcefulness.
What help can you offer to the world? Get creative and be resourceful. And you’ll find that there are a thousand ways you can make a difference with your business.
(4) GIVE YOUR TIME
Perhaps you are just starting out and you have more time than money. Or you simply don’t want to deal with doing the research needed to give your dollars responsibly, then, giving your time can be a great option.
Remember, the type of help you give doesn’t have to be related to what your business does. You could run a health and wellness business but decide to clean up local parks or provide support to veterans in your free time. Or you can sign up for an annual cancer awareness walk. It really comes down to who you want to make a difference in this World.
For example, I have a passion in protecting the environment and yet my business is not related to that. So over the years, I have been organizing clean up of local beaches to help make a small difference in this World in an area that I am passionate about.
Again, get creative and be resourceful. There are really many ways you can add purpose into your business and make a difference in your daily lives.
(5) GIVE YOUR KNOWLEDGE
One of the most important assets in today’s economy is knowledge. It’s no wonder the information industry is booming. People need knowledge and skills almost more than anything else to compete in today’s ever changing job market. This makes giving your knowledge an excellent way to give back to the society.
There are a ton of ways to give your knowledge, and you certainly don’t need to have a degree in education to get started. Here are just a few ideas to spark your imagination:
- Create free YouTube videos that can help others in a topic you are familiar with
- Help immigrants to learn your language at local community centre
- Offer one hour per week of free yoga lessons for underprivileged family in the community
- Spend a day and use your business acumen to help a non-profit improve their marketing plan
(6) OFFER SCHOLARSHIPS
Businesses and individuals can give out scholarships to a population in need.
You get to set the requirements for the scholarship. For example, you can offer scholarships to students who are doing community service and making a difference at the university you are an alumni of.
Or perhaps you are launching a premium online course on how to become a virtual assistant. You can ask your audience to submit applications. And you select 5 deserving individuals who meet your criteria to get your scholarship and enroll into your premium course for free.
(7) ENSURE THE PRODUCTION, PACKAGING AND SHIPPING OF YOUR PRODUCTS IS ETHICAL & SUSTAINABLE
If your business involves sourcing and selling physical products, you can choose to only work with vendors who are committed to ethical and sustainable practices. Or may be you are an interior designer, choose to use more sustainable or ethical decor and fabrics in your designs.
Look for products and packaging that are made of sustainable or recycled materials and keep a light carbon footprint as much as possible.
(8) EMPLOY INDIVIDUALS FROM POPULATIONS IN NEED OF MEANINGFUL WORK
If your business is in a position to hire, perhaps you can employ individuals from community or populations in need of meaningful, well paying work.
When I lived in Singapore, I used to visit food stalls run by Dignity Kitchen. In Singapore, only 5 out of every 100 with disability are employed and this rate is among one of the lowest in developed societies. So this is where Dignity Kitchen comes in. It is one of the few social enterprises in Singapore that trains, find jobs for, and hire people with disabilities, intellectual and social challenges.
Also, check out SamaSource, a company that provides technology and training to help underprivileged women in developing countries to make a living through dignified digital work and earn a living salary.
(9) CREATE A HEART-DRIVEN COMPANY CULTURE
If your business is in the position to hire, consider creating a company culture that respects and elevates your employees’ quality of life. This can be done through fair compensation, employee benefits and time off. Or perhaps give your employees paid time off to volunteer and give back to their communities.
I hope these 9 methods of baking purpose into your business above can spark some imagination for you and your business.
THE DOS AND DON’TS OF STARTING A PURPOSE-DRIVEN BUSINESS
OK, hopefully by now you are seeing why starting a purpose-driven business is an awesome idea and how you can start baking purpose into your business.
Below, I want to give you some additional tips on the Dos and Don’t of starting a purpose-driven business.
THE DOS OF STARTING A PURPOSE-DRIVEN BUSINESS
DO # 1: TELL YOUR STORY
Having a compelling story to tell your audience and potential customers is key for any successful business. However, this is even more so for any purpose-driven business.
Your story enables you to communicate the purpose of your business – and answer the question: WHY does your business exist and what matters to you the most.
A compelling story can help you become memorable to your audience and help you to stand out from your competition.
So, have an ABOUT page that shares your compelling story and include a page for your giving back initiatives. That way your audience and potential customers can get to know you and see the impacts you are making in this World through your business.
DO # 2: CREATE AND MARKET QUALITY PRODUCTS
It doesn’t matter your cause, if the products you create or market do not actually solve a problem or they are not of the highest quality.
Fundamentally, every business exists to solve a problem and deliver value – purpose-driven or not. So don’t neglect the basics of good business, whatever your mission.
Make sure that every product you create and/or market are excellent and can truly help your audience and customers.
DO # 3: BE GENUINE
Be genuine and congruent in what you say and what you do. Nothing creates emotional distance between the customers and a business as much as the customer feeling that a business is being dishonest and only supporting a cause merely for marketing purposes.
If you say you would donate a portion of your revenue to a charity or non-profit, follow-through on it. If you are a designer and support environmental initiatives, then reflect that core beliefs by choosing sustainable or recycled materials in your designs. Always follow the core values of your business and treat your customers and supporters genuinely.
DO # 4: SUPPORT A CAUSE YOU CARE ABOUT
One of the simplest ways to add purpose into your business is by supporting a cause you care about. What group in the population do you want to make a difference to in this World?
For example, I care about education for underprivileged children and I support women entrepreneurship, so I donate parts of my business revenues to build schools and fund programs for underprivileged women entrepreneurs in developing countries (see my Giving Initiatives).
If you need ideas, here are a few amazing organizations to check out:
A purpose-driven business uses its business as a force for good and as a platform to help the causes it cares about. Think of who you want to make a difference to and start there!
DO # 5: HAVE A GIVE-BACK STRATEGY
How do you want to make a difference in the World? What are the changes you want to see? Who do you want to impact the most? Have a strategy or plan in place to add and reach your purpose goals for your business.
Refer back to the 9 ways to bake purpose into your business above and select one or multiple ways that best suit your business.
DO # 6: TELL YOUR CUSTOMERS ABOUT THE IMPACT THEY’VE MADE
People want to be a part of something bigger than themselves. Letting your customers know how they have made an impact on a cause. This leaves them with positive feelings toward purchasing your products or services and facilitates a relationship in which they are likely to do business with you again.
You can communicate with your customers on this through your About Page. Alternatively, have a separate giving initiative page on your website/blog or communicate through your emails/newsletters to your customers.
Let your readers and customers know. They will be delighted to know that they are making a difference in the World through your business.
THE DON’TS OF STARTING A PURPOSE-DRIVEN BUSINESS
DON’T # 1: DON’T CONFUSE YOUR CUSTOMERS IN YOUR MESSAGING
As important as your cause is, your customer still needs to understand your products and services.
Therefore, make sure that your business model is clear and that you’re not just showcasing your cause. Also, remind customers that you are not just a charity, but a business they can purchase great products and services from while making a difference in the World.
DON’T # 2: DON’T CUT CORNERS
Nothing beats amazing quality and excellent customer experience. Production and materials may take longer or cost more in the beginning for purpose-driven business, but always strive to create and deliver outstanding products or services you can be proud of.
At the end of the day, the core of a business should be to solve a problem and serve its target audience.
DON’T # 3: DON’T END YOUR RELATIONSHIP AT CHECKOUT
Two-way communication is the core of any long-term sustainable business. Stay in touch with your supporters, potential customers and actual customers who have bought from you.
Ask for their feedbacks, continue to find ways to serve them better and let them know the impacts they have made through supporting your business.
DON’T # 4: DON’T WAIT TO GET STARTED!
So many people seem to think that they need to be making a ton of money in their business before they can start adding purpose and giving into their business. And that my dear friends, is simply not true. In fact, I highly recommend you to start giving from the very beginning.
Giving is both a habit and a mindset. And it is something everyone can do, all your need is your heart of giving. Just start now – you won’t regret it.
Final Food For Thoughts
As we wrap up on this blog post, I want to leave you with an inspiring quote from Margaret Weis.
We all have the power to make a difference in this World, no matter how insignificant that may seem. It is really up to us to take a stand and use our business as a force for good and start leading that change we want to see in this World.
DIVING DEEPER: RECOMMENDED READING
Disclosure: The below contains affiliate links, meaning, at no extra cost to you, I may earn a commission when you purchase through my links. This is how I’m able to keep most of my content free and support my social missions. Thank you for supporting my blog! Please read my disclosure for more info.
If you are interested to dive deeper into this topic, here are a few books I recommend.
- Start With Why: How Great Leaders Inspire Everyone To Take Action. This powerful international bestseller by Simon Sinek is a great book on why we must always start our business with purpose.
- Make Your Mark: The Creative’s Guide to Building a Business with Impact. This powerful book has so many golden nuggets and will help you transform your business.
- It’s Not What You Sell, It’s What You Stand For: Why Every Extraordinary Business Is Driven by Purpose. The insights and case studies in this book will inspire and help you discover your business’ purpose and help you proclaim it to the world.
- Start Something That Matters. The incredible story of the man behind TOMS Shoes and One for One, the revolutionary business model that marries profit and social good.
- The Promise of a Pencil: How an Ordinary Person Can Create Extraordinary Change. This New York Times bestseller tells the story of Adam Braun. While traveling, Braun met a young boy begging on the street of India, who after being asked what he wanted most in the world, simply answered, “A pencil.” This small request led to Braun founding Pencils of Promise, the organization he started with just $25 and has since built more than 250 schools around the world.
- Delivering Happiness: A Path to Profits, Passion, and Purpose. This #1 New York Times bestseller tells the story of Zappos and how concentrating on happiness of those around you can achieve success.
I wholeheartedly hope that you have enjoyed this post.
Now it’s your turn. What is your biggest takeaway from this article? Have you started your business? And how are you planning to bake purpose into your business? Please comment below! I would LOVE to hear from you. I read all my comments and will get back to you.
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