Doing good feels good and that applies to small businesses too. When you help those in your community by choosing to support a local charity, not only do you improve your mood and well-being, but you extend those benefits to your community and to your employees and customers, too.
Ready for your small business to support a local charity? Read these considerations first.
If you’re wondering how prudent it is to give away products, services, or money to a local charity when your focus is on saving money and growing profits, we don’t blame you. That’s a fair question. Ultimately, your decision will hinge upon several factors, including the size of your business, the level of involvement and your overall financial situation.
Beyond these basic considerations, here are a few others to address as you decide whether if involving your small business with a local charity is right for you:
- Return on investment. As a small business, you should weigh the costs of any charity involvement against the potential benefits. For example, if your business expects to gain increased visibility, goodwill and customer loyalty, the investment may be worth it. However, if the costs outweigh the benefits, it may not be a wise financial decision, at least not at this time.
- Alignment with brand values. Does being involved with a charity align with your brand values and mission? If your business is genuinely committed to supporting a particular cause or organization, the time and financial investments could be worth it, even if there is no immediate financial return.
- Available resources. Before offering your help, take time to evaluate whether you have the financial and logistical resources and bandwidth to support a charity effectively. For example, you may not be able to donate a large sum of money but you could still support a charity through volunteer work, in-kind donations, or other forms of support. It’s important to not overextend yourself or employees.
The benefits of partnering with a local charity
If connecting with a local charity still sounds like a good idea, fantastic — let’s talk about how getting involved can benefit your small business:
1. Boost employee morale and retention
You may be surprised how important it is for employees to work for a company that does good. In a global study, 75% of workers said they wanted to work for an organization that makes a ‘positive contribution to society.’
Working for a small business that supports a local charity can be motivating and a source of pride for your staff. It’s likely they (and you) are a part of that same community and will appreciate the opportunity to help make their ‘backyard’ a more equitable and positive place.
The advantage of connecting with a charity local to your business also means it’s easier for your employees to see firsthand the impact of their time and efforts. As a result, morale and employee retention rates can climb.
In fact, employees who are proud of their company's contributions to the community are more likely to stay with the company long-term, according to a survey which found that employees who believe their employer has a positive impact on the community are 3.5 times more likely to feel that their job is meaningful.
Before arbitrarily choosing a charity in the community to support, involve your employees. First, determine what needs exist in your community and then find out from your team what interests them. Once you have those two pieces of information, then you can match community needs with employee’s passions to find a charity that aligns with both.
2. Build brand awareness and increase visibility
Building awareness for charitable work isn’t reserved only for big-name brands. Small businesses can also secure coverage for good deeds whether that’s in local media or just sharing your acts of kindness on your website or in marketing materials.
One of the most effective ways to increase visibility is to simply show up and help. Whether you lend support to a single, local charity or spread your involvement around the community, most any day of the week — and particularly on the weekends when people are out of their homes — you can find a volunteer opportunity that incentivizes business involvement.
Possibilities include helping serve food at an event, donating your products or services to a non-profit auction, participating with employees in a clean-up effort of a public space. Your business incentive? The name and logo of your business on your shirts, printed on flyers or posted on the event website (before and after) and across social media channels — all of which are ‘free’ advertising and exposure.
Being visible like this in the community is an excellent way to increase foot traffic, inquiries and ultimately, sales. The more often your local community (a key source of business) sees your brand helping out, the more likely it is that they will remember you as a company that cares. And when potential and existing customers trust your business, they’re more likely to continue using your products and services.
3. Maximize marketing and public relations opportunities
Once you’ve involved your business with a local charity, let that work, work for you. We’ll explain: as you participate in community events and initiatives with your chosen local charity, use that involvement to catch the attention of local media outlets.
Local journalists count on press releases and leads to know what’s going on in the community and to decide what’s worthwhile of their reporting. Local media often do ‘roundups’ and likely, there will be a list your business belongs on.
Collaborate with your charity to create a joint press release about your efforts, then email it to local news and radio stations. If it involves an event, make sure to get the word out to popular community calendar groups or bloggers. Local parent groups are usually a great source for no-cost, word-of-mouth marketing.
Max out marketing opportunities by amplifying your own campaigns with those of the charity you’re helping. Sure, your local charity may not have a huge marketing budget (but you never know), but they can certainly spread the word about your involvement with their members and supporters. If you are offering or donating your products and services, make sure that is communicated via their marketing efforts. This is a cost-effective way to get your name in front of potential new customers.
4. Gain customer support and grow their loyalty
To keep customers coming back, loyalty is essential for any organization, but none more so than small businesses. You’ve likely heard that holding on to current customers is more cost effective and profitable than landing new ones.
This is important and financially impactful, so let’s dig into the customer retention vs. acquisition figures. They break down like this:
- Acquiring a new customer can cost five times more than retaining an existing customer.
- Every little bit helps. Increasing customer retention by 5% can yield an increase in profits from 25-95%.
- The success rate of selling to a customer you already have is 60-70%, while the success rate of selling to a new customer is 5-20%.
When you show you care, you are making a commitment to the community. This is profound and will earn the trust and respect among local customers. In fact, 78% of people believe that companies that are involved in community activities are more trustworthy than those that are not.
One way to gain customer loyalty is to make a compelling offer. Create incentives for customers to do business with you to help support your charity partner. For example, if you own a bakery, you could donate $1 for every cake sold to a local food bank. Or, if you own a bookstore, you could host a book-signing event and donate 10% of the ticket sales to a literacy nonprofit. If you own a pet-grooming business, you could donate $5 to a local animal rescue group for every dog you groom.
Getting the community involved with your charity work can make even stronger connections. Invite your customers to join you and volunteer together. You can also involve them at the point of purchase. If your business is already donating a percentage of profits, give your customers an opportunity to choose among 2-3 charities they’d like their purchase to benefit. This allows them to shop their values and affords your business another cross-marketing opportunity.
5. Tax advantages and deductions
Besides creating goodwill in the community, tax advantages are just another reason to get involved with a local charity — and this one benefits your bottom line. More than likely, your small business can receive tax deductions for supporting charities and nonprofits. Typically, donations of cash, volunteered services, inventory, or sponsorship of a charity event are eligible for a tax deduction. You’ll want to check with a tax advisor or your accountant to determine the tax benefits you’re eligible for and to ensure you comply with all the necessary tax requirements.
A final word on supporting a local charity: do your research
As you decide which local charity to support, do your research. While there are millions of charities in the U.S., not all meet the federal thresholds to be considered as such. You can easily verify their status on the IRS website.
Take time to have conversations with leaders, key staff and board members; review their marketing materials; confirm they are able to meet their overhead. The bottom line: do your due diligence and make sure you are impressed enough by their reputation, work and mission to associate your business with theirs.
Doing Good Is Good for Business
More than ever, people want to support local small businesses that share their values and benefit their community. If your business gives back to others, you have a huge selling point to offer customers. Follow the tips above and make sure to communicate that - you’ll be on your way to doing good while doing well.
We want to hear from you. Has your small business been involved with supporting a local charity? If so, congrats - how did it go? Are you considering supporting one?
Share your experiences with the Community below. We want to hear about (and support) all the good that your small businesses are doing and want to do.
Stephanie has worked in the B2B tech space for more than 20 years for brands such as IBM and Oracle, as well as on the agency side at Uncompany, The Favorite Co., Ogilvy and Mather, Leopard and other agencies. Stephanie believes in putting the reader first and won't rest until she's communicated a motivating, "Why should I care?" message. When she's not writing on behalf of her freelance clients, in her spare time, Stephanie's working on a novel and the occasional poem.