In Creating Awareness in the Business Community we talked about how you can raise your nonprofit’s visibility to the business community. In Helping Business Professionals Meet Their Goals we discussed ways you can help meet their marketing and net income goals, on which they spend millions of dollars. Now let’s look at the most common ways businesses give to nonprofits and how you can incorporate taking advantage of their offerings through your agency’s programming.
Dollars gotten that do not require a quid pro quo on your part are philanthropic dollars, that is, those donations made for charitable giving purposes. And, most often, company charitable giving means grants. Many businesses, particularly large corporations, have company foundations associated with them. Those foundations must give away 5 percent of their corpus, just like all other foundations. When you are deciding which businesses you want to target, you may want to look at which ones are associated with foundations. Then coordinate with your grant writer which corporate grants he or she will apply for. If you are a small nonprofit and don’t employ a grant writer, you need to weigh the time investment of writing the proposal with the realistic chance of getting funded from that particular business prospect. Your chances are probably going to be higher the stronger the ties your nonprofit has with that company. For example, the company may be a vendor of yours, or you offer volunteer opportunities for their company employees. To get a corporate foundation grant, you probably also need a well-developed public relations plan for letting the community know of the charitable gift. ReOn member, associating themselves with reputable nonprofits is a business strategy. Companies are in business to ultimately make money. If they give away money, there has to be a valuable reason why.
The downside to grant writing is that it is time intensive, very competitive, and usually restricted funding. Restricted grant funding must be used according to the terms outlined in the proposal. It cannot be used for anything else.
Employee Volunteer Programs
Employee volunteer programs are a great vehicle through which to develop relationships with businesses. As we pointed out in Creating Awareness in the Business Community, nonprofit volunteer opportunities pay off for businesses who take advantage of them. As we have seen, volunteer experiences help reduce a company’s recruitment, training, and retention costs. In addition, employee volunteerism is a form of charitable giving. If a company’s employees are giving to a nonprofit, the company can benefit from the branding associated with a reputable charitable cause.
Volunteers Reduce Costs
One payoff for you is that volunteers help reduce costs you incur in delivering goods or services to clients. Volunteers can be used at any stage of program implementation: promoting programs, gathering goods, preparing goods for delivery, or delivering goods or services. In times of declining resources, volunteers can be a godsend. Just make sure you follow labor laws and regulations regarding volunteer service and reduction of paid staff.
Volunteer Time has Monetary Value
You can use relevant volunteer time as income in grant applications. Volunteer time does have monetary value. Monetary contributions from local businesses show good community support, something important to grant reviewers.
If they fit IRS requirements, you may also be able to show the value of volunteers in your financial statements. According to the IRS, though, not all volunteer time qualifies to be listed in your nonprofit’s audit and 990 (tax return). Your auditor can give you more information about what volunteer time can and cannot be included in financial statements.
An added plus to offering volunteer experiences to company employees are the dollar-for-doer type programs some businesses have where the nonprofits receives a stipend based on the number of hours that employee volunteers for you. Tells you how valuable these volunteer experiences are valuable to companies.
In addition to placing volunteers in operational roles, volunteers in administrative or support roles such as assisting in a large mailing. Clerical experiences, however, are not very valued by companies with smart employee volunteer programs. They put much more value, with the accompanying stipend, on leadership roles, such a board service.
An often-overlooked volunteer role is that of coach or consultant. Many business professionals are experienced in marketing, branding, strategic planning, and current management best practices. They may also have access to technology that is too expensive for a nonprofit to buy. Opportunities to use and sharpen those skills are very valuable to companies. Ad you get expert advice and access to resources you don’t pay a dime for.
Publicizing Volunteer Efforts
If a company has an Intranet, this is the perfect place to submit pictures of company volunteers at your agency or with your clients performing volunteer work. You can also submit pictures and notes from clients expressing appreciation to the company and its employees. Or post a testimonial that shows how the client’s life has changed as a result of the company’s involvement with your organization. The branding opportunities and resulting reduces costs motivate the business to keep giving. But it is your mission that motivates the individual employees to give. The blog … will give you more insight into individual motivations for giving.
Volunteer opportunities are perfect human interest stories for use in press releases, radio and TV spots, newsletter articles, annual report content, and social media posts. Even it you can’t catch them in the act of volunteering, you can still talk about what they did and tell their story of why they became involved and what they got out of the experience.
Sometimes businesses give away tangible things, like computers, printers, or office furniture. They get the tax write off and you get equipment you couldn’t otherwise afford, Sometimes businesses are willing to donate merchandise to a fundraising auction in exchange for the publicity and community goodwill and you get to keep the funds raised. Sometimes companies provided branded item for client use reducing your operation costs, like canned goods, either to clear excess inventory or again, for the publicity and community goodwill. Sometimes companies provide the materials their volunteers use in carrying out the volunteer activity they participate in, again reducing your operational costs. In our experience, smaller, local businesses are often more willing to donate a piece of merchandise as opposed to making a monetary donation.
Employee Giving Programs and Matching Gifts
Employee giving programs are where companies take voluntary portions of employee wages and forward them to the nonprofits they support. Sometimes companies will match those donations, up to a certain amount. Companies that have matching gift programs will also match spontaneous gifts from employees (and often retirees), so be sure to ask your individual donors if their companies have matching gift programs and to credit the company for those gifts when they are received. Always ask the businesses you approach if the they have employee giving program and/or match employee gifts. Also ask if there is a company Intranet where you can contribute information of interest to employees. You get great visibility if you are featured on a company’s Intranet. It is an easy way to encourage donations. And report back on how those donations were used.
Percentage of Sales
Some companies are willing to donate a percentage of sales over a specific period of time to a nonprofit. This often popular with restaurants, beauty shops, and other businesses that want to increase their traffic while helping the community. Usually the exchange in these types of relationships is you drive traffic to where their products are and, in turn, they give you a percentage of sales. Sometimes you must also provide some sort of service in return, like gift wrapping or providing information to customers. The company benefits by increasing the market visibility, acquiring new customers, and the branding opportunity. In addition to the financial donation, you also benefit from increased community visibility.
Most nonprofits are familiar with event sponsorships. A nonprofit, however, can realize sponsorship income from more than fundraising events. Sponsorships can also be programmatic in nature. Or they may focus on your communications. Or the whole agency can be sponsored. How much of what kinds of sponsorships you offer depends on the preferences of your donors and what you as an organization can provide. That’s why it’s so important to know your constituencies’ group characteristics. Make sure you take an inventory of exactly how many of who you reach through each different activity you conduct. If you know how many people share what characteristics, you’re way ahead of the game. Because once you know that, all you have to do is tier the amount of exposure a company gets to each of its target groups to the amount of the requested sponsorship. Don’t go by what others do. Know your worth and price accordingly.
Don’t forget to invite businesses to the events and program activities you host. Particularly if there will be legislators or industry regulators there. They will appreciate you for it.
Event sponsorship levels will break down the event into its smallest parts, offering more of the separate parts the bigger the sponsorship request. For example, the lowest level of sponsorship may be a half page ad in a program journal or playbill and an annual report listing. The next level up may include a full-page ad, signage at the event, four tickets to the event, and an annual report listing. Then maybe offer a center spread ad, a banner hung at the event, six tickets, and an annual report listing. And so on until you have everything “sold.” To see sponsorship components your business community is familiar with, sign up for a business association event, peruse their sponsorship opportunities, and then go to the event to see how things work.
And it doesn’t need to be a fundraising event. It can be a conference or workshop. Or even a volunteer training. It all depends on the type of events your agency holds and who attends them.
In addition to events, companies can sponsor programs. You go through the same steps as you did with the events – breaking them down into their smallest parts and then dividing them into several tiers. The biggest difference in program sponsorships as opposed to event sponsorships, is the time factor. Program sponsorship opportunities can offer businesses exposure over a longer period of time. Investment in one-time events gets one-time exposure. Investment in a series of events, which continuous operation of a program is, gets multiple exposures over a period of time.
Things you can do to promote your programs and the businesses sponsoring it include press releases released around a mission-oriented observance for your nonprofit like Earth Day or Suicide Prevention Week or Women’s History Month. You can also publish social media posts that feature client stories brought to you be their program’s business sponsor.
If a company sponsors a program as opposed to a fundraising event, they are probably looking for brand visibility. Think of how the business can get brand exposure and be associated with their program over the course of the year.
And don’t think you will raise enough money to cover all your program costs. You probably won’t. You wouldn’t want to put all your eggs into the corporate sponsorship basket anyway. The more diversified your revenue streams, the more stable your long-term funding will be.
The advantage a program sponsorship has over a grant is that sponsorship monies can be used for anything you want as long as the terms of the agreement are met. Grant monies must be used as outlined in the grant proposal.
You can also have what I call media sponsorships. Media sponsorships use your communication vehicles to highlight the sponsor. For example, a business may sponsor so many editions of your newsletter. Or a year’s worth of interactive surveys of the month posted on social media.
Don’t forget about your website and its pages. When you design or re-design your website, you can incorporate placements for sponsor logos into your design. You can have sponsors featured on your homepage and/or the subpages. Target businesses that have something to do with or are somehow related to the page on which they appear. For example, your car donation page may be sponsored by a car dealership. Or your page about your tutoring program may be sponsored by a education testing firm. If you run an animal shelter, pet food and supply companies may work for you. Just make sure that you don’t waste time pursuing a competitor business, like a tutoring firm sponsoring your tutoring program.
You may even think of a high-priced agency sponsorship. An agency sponsorship can include any or all the components of the components of your events, program operations, and communication vehicles. Offering agency sponsorships may be good options if you are a small nonprofit with limited staff time to pursue multiple companies or a limited number of activities you conduct.
If you do, however, offer multiple types of sponsorships, make sure that the agency sponsorships actually offer and cost more than lower-priced combinations. For example, you want to avoid offering a $15,000 program sponsorship that can be combined with a $5,000 media sponsorship that ends up offering the same as or more benefits than a $25,000 agency sponsorship. Your goal, after all, is to raise the most money as possible.
Wrapping It Up
There are many ways for-profit businesses give to nonprofits including grants, employee volunteer programs, in-kind donations, employee giving programs, matching gifts, percentage of sales, and sponsorships. Take advantage of as many or few that your nonprofit can handle. Do remember, however, that businesses make up only 5 percent of charitable giving pie. And about 80 percent is given by individuals. Don’t put all your eggs in the corporate giving basket. Nonprofits with the most diverse revenue streams are the most sustainable.