In the words of singer/songwriter Randy Newman, ‘It’s a jungle out there’, and, as the song suggests, finding your way through the ‘confusion and disorder’ can be extremely worrying – especially if you’ve made the choice to go it alone in private practice.
This may strike a chord with more than half of BACP’s membership (60%), those who go where angels fear to tread. That isn’t to say doing so is foolhardy, not at all, but the self-employment path is often rocky and beset with obstacles. The cons are considerable, including financial uncertainty, fewer employment rights, the unremunerated time (spent doing accounts etc) and the isolation associated with working for days or weeks alone at a stretch.
Sure, client and supervisor relationships might help to stave off cabin fever, but what about those long hours of inactivity? There’s no opportunity for water cooler moments to discuss the TV or engage in the kind of informal social encounters that often help people through the day at work. Working alone productively requires incredible focus and discipline, as well as the ability to plan effectively. Assuming a person cracks that nut, they’re still left with the problem of juggling multiple competing demands. If you’re a champion multi-tasker, good; but for many, the reality is they can end up making real progress on nothing at all.
Certainly, there are pros too: freedom to work when, how and with whom you please, no line management responsibilities, you get to keep what you earn (after tax and VAT, of course) and, if you’re canny, you can build a strong portfolio of work. Not all bad then; there are swathes of nine-to-fivers who’d love the freedom and autonomy to work from home or at their own pace – especially when the temperatures rise and the aircon is on the blink (again). For those with entrepreneurial spirit, who aren’t put off by the income uncertainty, day-to-day hassles, hiccups and irritations of running a business, going solo can be incredibly enriching and rewarding.
Jane Travis has been a counsellor since 2005 and understands the difficulties around building a private practice. With Grow Your Private Practice, her online support platform, she’s helped hundreds of therapists to attract clients by showing them therapist-specific marketing advice that she describes as ‘simple, ethical and effective’. She challenges the notion that the market for therapists is saturated, arguing that where several therapists are offering services in an area, this helps to promote awareness of the profession, and in turn increases opportunities. Similarly, the presence of others in the market gives the therapist the chance to differentiate and develop a unique selling point or value proposition.
About collaboration, Jane reflects: ‘Working with other counsellors and adopting a “collaborative, not competitive” stance makes good business sense for private practitioners. For most of us, the thought of going it alone when approaching companies or holding events fills us with apprehension, so working together on projects combines skills and experience, provides support for each other and builds confidence. Not only that, but you can also refer clients to each other, helping combat feelings of isolation.’
For those who have built their private practice and are now able to explore growth potential, what are the options? One might be to consider the public sector procurement route. This is when a public sector body buys any goods, works or services in accordance with regulations that apply to all contracts over a certain value or ‘threshhold’. There are lots of attainable low-value public sector contracts out there, but do you have the capacity or skills to enter a new market? One of the main problems with public sector procurement is that smaller organisations often lack the capacity and scale required by tenders to bid for contracts, so are excluded from bidding.
Don’t let that deter you though; the UK Government currently spends almost £700 billion a year, making it the largest purchaser in many industry markets, and tenders are the only way to win most of this business. Moreover, as a result of the Public Administration Committee’s finding that public service markets are dominated by a handful of big companies, which are at risk of collapse, the Government has announced several measures to diversify the market for public services. But this research indicates that far more needs to be done to realise this ambition. How then to solve the capacity gap issue and gain a foothold?
The Public Services (Social Value) Act 2012 places a requirement on commissioners to consider the wider social, economic and environmental benefits to communities when procuring services. Indeed, most tenders advertised through the Government contracts finder portal indicate whether an opportunity is suitable for small- to medium-size enterprises and charities, community groups and voluntary community social enterprises (VCSEs).
Public sector procurement: how does it work?
For those unfamiliar with the language and process of public sector tendering, here’s a brief guide:
- Public sector procurement rules require that an invitation to tender (ITT) must be published to generate competing offers for contracts above a threshold of £10,000.
- There are four procurement procedures used to award contracts in the tendering process, the most common being open and restricted tenders.
- In an open procedure, advertised tenders invite interested parties to submit bids by a set date, which are then evaluated, and contracts are awarded to the winning party/parties.
- In a restricted procedure, there are usually two stages: a filtering stage, in which a shortlist of providers is identified, using a pre-qualification questionnaire (PQQ); and a second stage that follows the open procedure, with shortlisted contractors submitting bids.
- Tenders are advertised through public contract notices found on commissioning portals. Each of the UK’s home countries has their own portal, which publish tenders.
- Some public sector bodies, including local authorities, publish tenders on their own websites.
A note of caution, however; recent analysis by Tussell, on behalf of Social Enterprise UK,1 the leading global authority on social enterprise and the biggest network of social enterprises in the UK, found that the number of social enterprises winning public sector contracts has fallen to its lowest level for two years. Moreover, even those contracts deemed suitable for social enterprises and charities are not being won by them on a large scale, with only 11 per cent of contracts deemed suitable being won by VCSEs. That doesn’t mean it’s a closed shop, more that would-be contractors need to be aware there are no guarantees.
Charlie Wigglesworth, deputy chief executive of Social Enterprise UK, offers this for consideration: ‘I think the most important mind-set for a social entrepreneur is “know your limits”.’ That isn’t to say ‘limit your aspirations’ but be clear about what you can and can’t do, what you’re ready for right now and where you want to be. That kind of clarity comes from planning effectively and, as part of that, identifying what you need to know and who might help you get to where you want to be.
There are many benefits to collaboration: it can increase the geographic scale of an existing business, create synergies with what other organisations do, build a more seamless client journey, add niche aspects to existing services and provide access to social investment. Additionally, commissioners and other funders value collaboration, as it can limit duplication of provision in an area, and offer increased value for money with better services. Collaboration also allows businesses to pool resources, skills and knowledge to be more effective in meeting existing market demands and innovating.
Collaboration’s what you need
There are several ways to collaborate, of which forming a consortium is just one. These include everything from a loose network to a full merger. Consortia building offers a solution and has been commonly used in public sector procurement for some time, particularly by third-sector organisations that come together to better serve local need. Staying with the consortia building approach, there are numerous operating models that can be applied. These include:
- The managing agent model (MAM) – where a lead partner secures a contract and sub-contracts the delivery to other providers. The managing agent (MA) doesn’t deliver services, instead they specialise in providing a contract winning and management function.
- The managing provider model (MPM) – like the MAM, but the lead partner both sub-contracts and delivers services.
- The super-provider model – by far the most common model, in which a group of individuals or organisations come together to set up a separate legal structure, which embodies collective ownership and control. Through this structure, many separate providers (or individuals) effectively become one large provider, usually with a central ‘hub’ concerned with scoping and bidding for contracts, developing key relationships, managing contracts and recruiting and managing membership.
The consortia model chosen should reflect how your enterprise intends to meet needs, unmet or otherwise. If you’re an established provider, with a solid track record of delivery and good infrastructure in place, the MAM might be better for you. For example, utilising a network of associates or affiliates to deliver a contract on behalf of a commissioning body or other organisation. This approach is more resource efficient as overheads are reduced and the MA top-slices a percentage of any contract to pay for the management of sub-contractors. The potential downside is that the MA is not involved in delivery and is accountable for ensuring that quality standards and performance are maintained. This is fine if you have a penchant for performance management, but reporting to commissioners can be an exhausting and thankless task.
Regardless of the model, a consortium will need to have an appropriate legal structure in place, which is straightforward, depending on your intended purpose and scope of activity. For social enterprises, operating in the public or community interest, there are several options, including registering as a limited company, community interest company (CIC) or charitable incorporated organisation (CIO).
Why set up a separate legal entity? Creating a separate organisation is a method of formalising the way the shared work is managed. It helps isolate risks and can encourage greater clarity in governance and finance. A new legal entity can have the benefit of being a venture jointly owned by all partners. It can also give a separate identity to the work and create a useful perception of distance between the collaboration itself and the partners.
Each different legal structure has its own set of requirements, and their respective fitness for purpose will depend on how your consortium will operate and to what aims. More detailed guidance on legal structures can be found on the gov.uk website. The Charity Commission and Social Enterprise UK (SEUK) offer a range of free support resources for their members.
Success factors: doing it right
What are the key ingredients of a successful collaboration/ consortium? In truth, they are numerous, and will depend largely on the situation and context it has been developed for; however, some of the key factors include:
- Get the right advice – there’s so much support out there, including your Local Enterprise Partnership, and the BACP online resources.
- Choose the right partners – a group that has people with complementary skills, experience and shared values is far more likely to succeed.
- Use the right structure – the partnership needs to operate within a structure that works, is fit for purpose and suits the needs and aims of the consortium.
- Look beyond a single opportunity – yes, we all aspire to landing that juicy Clinical Commissioning Group contract, but don’t develop tunnel vision; cast the net a little more widely.
- Begin now; don’t wait – inertia is one of the biggest killers in any domain. While you’re pondering the perfect decision, someone else is getting on with it. Just do it.
Ready, steady… go?
If you’re convinced that collaborative working is the way for you, and the prospect of setting up a consortium to bid for contracts excites you, then make a start on identifying who you want to approach, with a view to bringing partners together afterwards. There’s no ‘one size fits all’ here; it really will depend on the scale of your ambitions and the sort of opportunities you want to bid for. Your enterprise will need capital, so get together seed corn finance or bid for grants if you’ve chosen a legal entity that allows it.
You’ll need a good business or project plan, both to articulate the aims and objectives of the enterprise and to help influence would-be investors, grant makers or commissioners. Define your outcomes and interventions; what will your consortium achieve? How will you measure this? If you’re going to operate a social enterprise, you may need to think about the social value or ‘social return on investment’. Will your service support a range of mental and physical health outcomes, improve community cohesion, help people back to work or challenge social injustice? It’s likely you’ll tick all those boxes, so be clear about the value you will be adding and promote this.
Finally, develop and write bids – lots of them. There are several ways to access public sector contracts, with many advertised through online portals and, with lower value contracts, it may be possible to go directly to a commissioner or organisation, such as a school or local authority. There is a wealth of support online to help with bid writing – whether that’s to apply for grants or contracts.
Hopefully, as you’ve read this far, you may be inspired to develop a consortium and start bidding for contracts. Indeed, you may already be doing this but want to explore growth potential, or you may be taking your first steps and are looking for guidance. Wherever you are in your journey, help is at hand. A selected list of useful links is provided and my inbox is always open to enquiries. Finally, Russian revolutionary (and anarchist) Peter Kropotkin was quoted as saying, ‘Competition is the law of the jungle, but cooperation is the law of civilization.’2 Kropotkin was right, but then so was Randy Newman. It really is a jungle out there; but it’s easier to get through it together.
NOW* set up as a small therapy centre, offering a whole service to schools that supports children, parents and staff. The service is designed and run by two BACP members with a track record in school-based counselling, but more importantly the desire and willingness to make a difference. Rather than accept the market conditions or bemoan a lack of paid employment opportunities, these members took things into their own hands. They identified a gap in the market, designed a service to meet need and approached schools directly with their offer.
Lydia, co-creator of NOW, offers a different perspective on the counselling landscape, one that offers hope to others: ‘I’ve never seen so much opportunity for counsellors to create services that are needed. We created a service that provides real value for money. So far, we have one contract in place, but we believe it’s the start of something exciting.’ Moreover, Lydia came into contract delivery with little experience, stating: ‘I was totally new to this, so have written everything for my model myself, and, with the help of a colleague, we are now looking to collaborate with other therapists who can buy into our vision for NOW.’
Lydia has traversed considerable challenges in her own life but hasn’t allowed negativity to hold her back. She’s used her experiences to help motivate and inspire her, and her model is rooted in a desire to provide ‘something positive for people’. She understands the benefit of collaboration and has started to look at how her model could be shared by others working in therapeutic settings.
Having the right mindset has been key to Lydia’s success. She concedes that while she isn’t ‘academic’, she possesses other qualities, like tenacity and an ability to think outside the box, that have proven valuable. Indeed, among the most critical successful factors for any entrepreneur are imagination, creativity and the willingness to keep going in the face of adversity. Lydia is looking forward with ambitions for growth, one day hoping to employ others to expand her enterprise: ‘I’m tentatively starting out on a troublesome but exciting journey to be a small independent service provider, championing the positive power of therapeutic services. We are small and at the beginning, but I hope and plan it to be a great and worthwhile journey that encourages and brings others on board.’
* Commercially sensitive information has been changed or withheld at request.
Kris Ambler is the BACP Workforce Lead. Formerly, he has worked across the sectors in business development and management consultancy roles, with expertise in social enterprise and fundraising. Email: firstname.lastname@example.org
1. Social Enterprise UK. Social enterprises winning public sector contracts falls to lowest level for two years finds new research. [Online]. https://www. socialenterprise.org.uk/social-enterprises-winning-public-sectorcontracts-falls-to-lowest-level-for-two-years-finds-new-research (accessed 17 June 2019).
2. Kropotkin P. [Online.] https://www.azquotes.com/quote/1023038 (accessed 23 July 2019).