Page 18 - Social Enterprise A New Business Paradigm for Thailand

Prayut Chan-o-cha in collaboration with the private sector across 76 provinces, shows that this
model has the clearest operational framework among all social enterprise types studied. The

findings include:

1) Provincial-level companies show wide disparities in revenue, with a Gini coefficient as high
as 0.79. Between 2019 and 2023, 43 companies experienced revenue growth, while 33
companies showed declining revenue trends.
2) Most provincial companies (62 in total) still face accumulated losses over the past five
years, indicating that they are not yet self-sustaining.
3) Only 14 companies out of 76 have achieved positive cumulative profits over five years,
more than seven years after their initial registration.

These figures underscore the reality that building a successful social enterprise, even with a

well-structured ecosystem backed by both the state and private sector, remains a difficult
undertaking. Effective and visible impact still requires time and persistent effort.

20. Determinants of financial sustainability
A comparison of financial sustainability, based on revenue and net profit data from 245 social
enterprises in the Department of Business Development’s database, reveals that enterprises
founded before 2014 are more financially sustainable than those established later. Social
enterprises with annual revenues over 10 million baht also exhibit stronger financial
sustainability compared to smaller entities. In addition, non–profit-sharing social enterprises

are more financially sustainable than their profit-sharing counterparts. This aligns with findings
showing that social enterprises that registered to receive tax incentives tend to perform better
financially than those that did not. When analyzing spin-off social enterprises with flexible
support structures, these entities demonstrate greater financial sustainability than general
social enterprises. This is attributed to early access to strategic business planning, the ability
to generate income from the outset, and the use of innovations that address social needs.

Conversely, the Pracharath Rak Samakkee group, despite having a comprehensive support
system, demonstrates lower financial sustainability. This is largely due to weaknesses in

business model design and the fact that most provincial-level staff are volunteers, leading to
low motivation and insufficient manpower to manage the companies effectively. Finally, in
predicting net profit margin performance, it was found that flexibly supported spin-offs and
limited partnerships tend to achieve higher profitability than other organizational models.

21. Challenges faced by social enterprises
The Pracharath Rak Samakkee group, which operates as a structured system, must find a
business model that aligns with the digital age, in which rural entrepreneurs and farmers can
now access markets through social media networks. The group’s original model, centered

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