Somewhere in the midst of the separation of church and state and the American Dream, we’re raised to be philanthropic. To give when others have nothing. But running a business is about profit. So can you succeed if you’re busy giving? Can we also benefit from charity work? Is it kosher to donate for profit? Yes, yes, and yes. Plenty of small businesses flourish under a giving and receiving model. I spoke with a few small business owners who have prospered with a charity component and here’s what they get in return.
The do good-ery brings new customers. The visibility generates new and repeat business. Dr. Michelle Copeland, a New York plastic surgeon, has always donated her products to different communities and organizations and the result has been consistent: “We find ourselves with new customers and great relationships.” Copeland believes charitable involvement should be a part of every business plan.
The charity component allows high-revenue clients to spend money during recessionary times. Inside Sports Entertainment connects corporate entities with exclusive sport and entertainment events. The Lehman Brothers financial fiasco and the economic downturn both prevented companies from big client spending, and, consequently, Inside Sports Entertainment felt the burn. Adding a charity component turned business around. In 2008, the company arranged a concert series where they took control of all facets of the production. They personally hired stars like Bon Jovi, Dave Matthews, and Jerry Seinfeld; they rented out venues like Madison Square Garden and Nassau Coliseum; and they sold the prime location tickets and meet and greets to their clients while donating the bulk of the earnings to the stars’ charities.
“We found adding a charity component to anything made it easier to get clients to spend money again,” said Matt Haines, Senior VP at Inside Sports Entertainment. “Banks have been restricting companies on how much they can spend on clients and entertainment. There is no more $15,000 a head at the Super Bowl. But when a charity component comes in, the approval process is much easier. Plus, there are people benefiting hugely from a good time.”
It connects companies and employees to the community. As you get to know the community your business is in, fellow citizens embrace your business. Together, your company and the community improve and thrive as more people develop skills and operate their lives and professions more efficiently.
Scheck Outdoor is a mobile advertising company run by Jeff Scheck. He decided to donate ad space on his truck to Crimestoppers for an event sponsored by the Sheriff Department of Passaic, New Jersey. “I wanted to do something for the community and I wanted to get a lot of exposure,” says Scheck. “Three thousand people saw that ad, and a few hundred people were curious enough about my business to come to me and ask about how they could get similar reach.” Scheck realized early on in his new business that mobile advertising had a larger impact on communities versus static outdoor billboards. Plus, his truck could do it for a lot less money. Since donating the ad space, Scheck has since added Kenneth Cole and Boiling Spring Savings Bank to his client roster.
The new connections diversify relationships. Corporate social responsibility programs familiarize companies with nonprofit organizations, which can lead to sponsorships and partnerships. Such programming can then connect companies to difficult-to-reach segments of their community.
Goodbee & Associates, a local woman-owned engineering company in Denver, works with Habitat and sponsors for a few build days every year. “My staff not only participates in the build days with enthusiasm, we recruit other small business and clients to volunteer with us,” says Lisa Goodbee. “It has proven to be an excellent opportunity to demonstrate to clients and like-minded firms that not only are we top notch engineers, but we are also a great group of folks with our hearts in the right place. Our build days are the ultimate team building experience for staff and clients. Talk about subtle marketing!”
And, as result, a charity component widens networks. The more people associated with the company through a cause, the more opportunity the company has to be exposed to new ideas, strategies, and skills. (As needed, of course!)
As a member of Habitat’s corporate leadership team, Goodbee works with other small business leaders on various projects. “This is a perfect example of not just writing a check for a charity, but using your professional skill set to blend work and charity,” says Goodbee.
Goodbee’s company works with a local public involvement firm, Regnier & Associates, and a local land use firm, ArLand Land Use Economics, where they volunteer their time toward the project and the community.
“We meet regularly with local officials, we are developing a speakers program to help ‘spread the word,’ and we are enthusiastically hoping to see the fruits of our labor over the next decade,” says Goodbee. “Sure you get the ‘feel good’ side of things, but you also get concrete benefits for your business.”
Your company is admired and trusted. Small businesses rely on their reputation in their communities. “Prospective clients and employees have told us that they like our commitment to helping nonprofits; in some cases, it’s been the reason they’ve contacted us to explore working together,” says Sarah Rasmussen, of MGA Communications, Inc. in Denver. “We’ve received business and business leads as a result of our efforts and have enhanced our ability to provide exceptional service to current clients.”
Ultimately, “It is a boost to the company’s bottom line when our reputation includes quality engineering and caring as well as civic-minded employees making a difference in the local community,” says Goodbee.
