Community businesses are crucial to local communities, creating employment, offering goods and services and increasing trade for other firms, says a report from Plunkett UK.
Plunkett, which supports rural community businesses, has released its Impact Report 2025 which finds that the sector has, on average, a five-year survival rate of 99% – much higher than the 39% survival rate of private small and medium enterprises.
The charity adds that it has supported 828 community businesses through launch, with nearly another 800 in the pipeline, and 30 openings each year.
In 2024, the report says, Plunkett worked to raise awareness, reaching “an estimated total media audience of 15 million people with coverage in national and local TV, radio and print channels”.
In terms of practical support, it assisted 302 community groups with community ownership advice via its accessible phone line and delivered 44 training events.
And it responded to six government consultations and took part in 11 national campaigns and alliances.
Plunkett’s report also outlines the impact of community businesses on local communities.
“Thriving where others fail, many offer more than basic services,” it adds, “acting as multi-service hubs that proactively reach out to support people most vulnerable.
“We estimate 2 million people across the UK benefit from rural community businesses, of which 25% of beneficiaries are likely to be aged 65+ and more vulnerable to poverty, isolation, and loneliness.”
There is also a knock-on effect for other local firms, says the report. “Community businesses tend to source goods and services locally, creating a circular economy in the places they exist.
“For example, in 2024, community shops sourced from an estimated total of 13,000 local suppliers, with many helping other new business start-ups who used their local community shop as a first step to market.”
In terms of job creation, “many community businesses actively employ people who face barriers to work, such as those with caring responsibilities, disabilities, or limited qualifications. There are a total of 25,000 volunteers in community businesses; it is something that is equally important for younger and older people – an opportunity to be part of something and feel valued.”
There are also environmental benefits, the report argues, with rural community businesses investing time and resources into initiatives that have a positive climate impact. “It is integral to the way they do business, not an add-on, and they do it for the greater good, not because it translates to sales. More than eight in 10 community businesses have either installed or are considering installing energy saving measures.”
And in terms of equality, the report says that rural community-owned businesses are “naturally inclusive as a result of their democratic ownership structure”.
It adds: “They are gathering places that foster social connections and a sense of belonging, regardless of background, age, or ability. A third of them offer employment to people for whom it was their first paid job.”
Harriet English, Plunkett’s deputy CEO, said, “It’s a simple act such as placing a chair near a till for a spontaneous cup of coffee and chat that demonstrates community business commitment to being welcoming and inclusive places for all, especially to those in need of a sense of connection and belonging.
“We are very proud of our impact for rural communities across the UK, which we would not be able to do without the support of philanthropic trusts and foundations, corporate partners and organisations in the placemaking sector. Working in partnership and collaboration with others ensures the community business sector will continue to go from strength to strength, creating thriving, resilient and inclusive communities for generations to come.”
