Charitable Giving Can be a Valuable Business Tool

Many businesses look at charitable donations as little more than a tax deduction. However, there are many good reasons for a company to give a portion of its hard-earned profits to deserving nonprofit organizations among them are establishing good will, enhancing its image in the community, maintaining customer loyalty and even pumping up sales.

More than Money

You’re running a business, and you feel like you should be giving back to your community. Your first move should be to determine exactly what you are able to do to help a charity. It doesn’t have to be all about writing a check every now and then. There are other ways you can pitch in and lend a hand.

• You and your employees can volunteer at nonprofit events.
• You can sponsor an event for charitable organizations.
• You can donate your products or services.
• You can donate a percentage of your profits on a specific day. For example, if you are running a restaurant, you can give 10 percent of your gross sales on a particular day or even regularly, such as the first of each month.

A Good Match

Unless your business has the resources of Wells Fargo or Walmart, the two companies that gave the most to charity in 2012, according to the Chronicle of Philanthropy, you’ll have to decide which nonprofit organizations are most deserving of your attention.

Here are some things to consider:

• It’s probably a good idea to connect with a nonprofit that relates to your business. For instance, if you sell or manufacture ladies’ clothing, an organization that raises money to fight breast cancer might be a good match.
• If your customers are mostly local residents, a local charity might be a good fit. If you sell your products or services nationally, you might be better off giving to a nationwide organization such as the American Heart Association or the American Diabetes Association.
• You might want to donate to an organization that is personally meaningful to you or one of your employees. For example, if a relative of yours died of cancer, you might choose the American Cancer Society.
• Your employees will feel a whole lot better about helping out if you give them a voice in deciding which organization you will donate to and how big a role your company will play.

Check it Out

You should do some research before you decide which charities are the best match for your company. You can find out a lot of what you need to know on the internet.

For instance, determine which charities earn top grades in various areas:

• Finances
• Transparency
• Results for serving the people they claim to serve.

Of course, you also can find out which charities do not perform well and which ones spend more on administration and marketing than they do serving their core purpose. You might want to stay away from these.

Keep Them Informed

It’s also an excellent idea to let your customers play a role in your charitable endeavor. After all, if they know what you’re doing to help those who need your help, they’ll probably be inclined to send some business your way — especially if they support the same charity.

Here are some things you can do to get your customers involved:

• Let your customers know about your activities by highlighting what you are doing on your website, on your Facebook page, through Twitter and in your newspaper, magazine advertising and direct mail pieces.
• Encourage your customers to volunteer with your employees on a specific day.
• Keep your customers updated on events you are sponsoring.

Don’t Shun Publicity

We realize that your major motivation for making charitable donations is to do the right thing. Nevertheless, you shouldn’t pass up the opportunity to publicize your efforts.

• Contact local media outlets and send them a press release, with photos, when you donate goods or services to a charity.
• Highlight your activities in your print, radio and TV advertising, and see if the charitable organization will mention your company when it sends out its own promotional materials.
• Publicize your connection to the charitable organization by displaying brochures in your store or office and encouraging your employees to wear pins or buttons highlighting the organization. You also can offer special deals to people who work for or with the charity.
• If you attend the charitable organization’s meetings and events, you might be able to make new contacts with people who support the same cause. This in turn could lead to new business for you.

Donating goods, services or cash to a charitable organization is a great way for a company to feel good about giving back to the community. But it also can serve as an excellent method of adding to the business’ bottom line.

Myrna Vaca is the Head of Marketing and Communications at Lyoness America, where she is responsible for marketing, communication and business development efforts. Lyoness, an international shopping community and loyalty rewards program, sponsors the Lyoness Child & Family Foundation (CFF) which is actively involved in supporting children, adolescents and families worldwide, especially in the field of education.