From failure to success: rethinking business model design for community-based enterprises

Purpose Community-based enterprises (CBEs) offer a promising strategy for facilitating sustainable local development, yet many experience failure or underperformance. This study aims to explore the concept of community-based business model (CBBM) as a tailored approach to CBE success, analyzing the configuration, development processes, challenges and key factors that contribute its success. Design/methodology/approach Using a multiple case study approach, the authors investigate five leading CBEs in Indonesia, each located in different provinces and include various businesses such as agriculture, farming, tourism and crafts, ensuring a broad representation of CBE business models. Findings The study identifies key characteristics and design elements of CBBM, providing a structured approach on how “successful” CBEs create, deliver and capture value. It also examines the development processes, challenges and key success factors that enhance CBBM effectiveness, offering insights into what drives the development of a “successful” CBBM. Practical implications The concept of CBBM offers an important implication for organizations engaging in CBE that they should shift from generic BM to a more customized BM to enhance the likelihood of creating sustainable and impactful CBEs. Originality/value This study advances the literature on CBE and BM by conceptualizing CBBM as a distinct BM tailored for CBEs. It provides theoretical and practical insights into how BM design can enhance the effectiveness of CBEs, laying the groundwork for future research on BM design in CBEs.