Why This Small Social Enterprise Failed

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July 18, 2013; Grand Forks Herald


In October, Prairie Harvest Mental Health, a nonprofit serving adults with serious mental illness, will close one of its employment and revenue-producing schemes, The 4th Street Eatery. The Eatery is a small café that served homemade lunches, mostly to employees of the building in which it was situated.

According to Executive Director Debra Johnson, the enterprise has lost too much money and exhausted too many resources—but still, she said,closing “it was really a hard decision for us.”

The county, whose building the eatery was in, provided the facilities free of charge to the group and reportedly its view of the Red River was a draw especially during flooding but the café, which is staffed by Prairie Harvest clients, could not turn the corner.

For your information, should you be considering a similar venture, these are the problems that were cited in a letter the organization sent to the county:

  • “Consistent and considerable losses.”
  • “Difficulty with supplies purchasing. Vendors did not deliver to the café because of low volume,so staff members were required to shop for and transport supplies.”
  • “The eatery operation was more like a sheltered workshop for clients, rather than an opportunity for them to work in independent positions in the community.”
  • “The continual struggle to find supervisory staff that not only had social work background, but also restaurant experience.”

Prairie Harvest still operates other endeavors,such asthe Home Place Thrift Store, located in the Town and Country Mall. Of its 100 clients, the eatery employed 10.—Ruth McCambridge