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BizReport : Internet : March 28, 2019

4 Reasons To Incorporate Donations Into Your Business Model

Are you considering integrating charitable donations into your business model?

Charitable donations is a good idea to explore. Donating to charity is a solid strategy to build a reputation of trust and demonstrate social responsibility. Most major corporations know this, and either run their own non-profit organization or donate to others.

According to Business Insider, individuals and businesses donated a total of $410 billion to charity in 2017. Five percent of that total came from large corporations including Google, Goldman Sachs, and Wells Fargo.

Large corporations have more than enough income to donate millions of dollars each year, but disposable income isn't a requirement. A business of any size with any amount of revenue can start donating to charity.

Still on the fence? Consider the following benefits of making regular charitable donations:

1. Charitable activity will strengthen your brand

Your brand image is your company's biggest asset. Charitable giving strengthens your brand image in the public's eye. When your charitable activity is directly related to your industry, it shows you care extensively about the people in your niche.

For example, in 2017, Wells Fargo donated $287 million to more than 14,500 non-profits, and its employees volunteered two million hours. The company also donated $45 million to programs that help home buyers make down payments. This type of charity gives Wells Fargo a good name in the financial industry and undoubtedly strengthens their brand.

2. Donating your products to people in need shows the world you care

When people know your products are being donated to people in need, it makes a deeper impression than if you were to simply donate money to random causes.

A good example of a company doing this is kidpik, a monthly clothing subscription service for girls. They partner with the GOOD+ Foundation to send brand new clothing items to girls in need. Kidpik's business model allows customers to return items they don't want, or they can keep the whole box and receive a 30% discount. For those who keep (and pay for) the whole box, they can donate items to the GOOD+ Foundation with a pre-paid envelope.

3. Charitable giving can inspire you to build a better product

When Bombas launched a company that revolutionized the modern sock, they didn't set out to create happy feet. Their business model was founded on resolving an unmet need: getting socks to homeless shelters.

When Bombas co-founder David Heath learned that socks are the most requested clothing item in homeless shelters, he couldn't shake it. He was shocked to learn that socks are a luxury for some people. An entrepreneur at heart, Heath and his friend Randy Goldberg came up with the idea to launch a sock company that would donate one pair of socks for every pair sold.

The 1-to-1 donation model isn't new, but Bombas took it one step further. The company doesn't donate the same socks they sell. Rather, they engineered a special kind of sock that meets the specific needs of people who don't have the luxury of putting on a fresh pair of socks each day. The donated socks have reinforced seams, come in darker colors to hide wear, and get an anti-microbial treatment, so they don't need to be washed as often.

Bombas launched in 2013 and has donated more than 18 million pairs of socks as of March 2019.

4. You'll attract conscious employees and/or business partners

Many people prefer working for companies that donate time or money to charitable causes. By giving back to your community (or the world at large), you're potentially going to attract employees and business partners that want to be aligned with your causes.

What kind of giving program do you want to launch?

There are all kinds of philanthropic programs you can launch to give back, including matching programs, volunteer grants, scholarship contests, automatic payroll deductions, and employee product donation programs. If you're not in a position to start your own program, consider partnering with an existing non-profit.

What non-profits exist in your industry that you can donate to, or volunteer with? Find a non-profit that aligns with your values and intentions, and start building your company's brand through giving.


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