SMEs failing to realise the business value of local community relations

Results reveal that almost half of SMEs do not support their local community, despite the fact that most recognise that community relations increases staff morale and makes their business more attractive to potential customers and employees.

The RIBI ‘Community Matters’ report, which surveyed more than 500 senior managers in small and medium sized businesses and 1,700 members of the general public, also found that companies are failing to understand the business opportunities that local community engagement can present. More than a third think ‘giving back’ is the main benefit, with just one in ten spotting the opportunity for business development.

John Minhinick, RIBI President, said: “With more than half of consumers more likely to buy from a local business that supports local organisations, businesses have a real opportunity to benefit from their community support.

“While ‘giving back’ is an important element, businesses are missing out on the other commercial benefits such as raising brand awareness, meeting new contacts and employee development. Choosing a route that makes business sense will result in a stronger and more long-term commitment to the chosen cause, thereby benefitting all those involved.”

While almost half of SMEs do not support the community in any way, 52 per cent of respondents think their company could do more, citing lack of money and time as the main barriers.

John Minhinick added: “Rotary provides a link between businesses and the community, enabling companies of all sizes and functions to get involved in local projects while ensuring they maximise the opportunities such engagement brings. If businesses have a better understanding of how they can make their community support work for them on a commercial basis, then any money outlaid on a particular cause can be justified and will result in a more planned, strategic and beneficial commitment.”

The research also showed that the public believes businesses should be responsible for filling funding gaps left by the government and other third parties post-recession. The business response post-recession has been positive, with almost a fifth increasing their community support and just 10 per cent making cuts.