The Features and Future Possibility of Community Business in Japan

Community business is one of type of social enterprise which is an active player of social economy. In United Kingdom in which community business is prosperous, it has an important part in solution of the social problems with unemployment circumstance. Community business was introduced to Japan in the 1990s and it was accepted as a favorite business model for the good image which the word “community business” had. There are many enterprises that are called community business but most of them are not profitable or their size is very small, and they do not necessarily relate to social enterprise.

I think that community business is influenced from an idea of shadow work (I. Illich), an idea of an intermediate technology (E.F. Schumacher) and a theory of the informal sector. I classified community business to three types.

1. Its aim is to start business.

The entrepreneur of community business has own social purpose and its goal is not to aim profit maximization. Community business is considered as the method of making a risk small. Part of entrepreneurs enters to the social welfare business - for example home nursing care service and community-oriented welfare facility - that can bring reward for nursing by the Long-term Care Insurance System founded in 2000. The feature of this type is that entrepreneurship appears strongly

2. It is based on the resources in a community.

The founder thinks a community important in business activity and uses the resources of the community (included a human resource such as a full-time housewife). It is expected to satisfy requirements of the community and to have an active role to strengthen own community’s tie. But the scale is small and many of these are not profitable adequately. This type often is called “business in community”.

3. It has feature of social enterprise.

The organizer thinks that community business is a method of solution for a social issue with supports of local government and residents and market mechanism.

I appreciate the diversity of community business in Japan. It has been developed originally according to the institutional systems, cultural and natural climate, and historical background in Japan. Besides the job creation of the urban area, in new town that was constructed at 1960’s there is community business as a means of reproduction of a community and in rural area where population decreases rapidly, community business plays a safety net for residents. I think many experimental tries have been done in the name of “community business” and the part of them made accomplishment better than that founder or residents expected. Community business will be expanded in near future based on the increase in the supply (e.g. baby boomer’s retirement) and the demand.

In Hyogo Prefecture, unemployment has risen after the big earthquake disaster in 1995; the support policy of community business was introduced for job creation. Afterward, community businesses that this policy supports increase, now the number of them is 149. In the questionnaire, 65 cases of 149 (43.6%) replied that business was expanded in the past three years. And kind of them is diversified, from the social welfare service to PR of protected species.