Sometimes, the best businesses are ones that give it away — to charity that is. If you make charitable giving a priority, you may find it can benefit your reputation, your soul, and, ultimately, your bottom line.
Goodwill giving is good for business. Donating to charity — either your money or your time — on behalf of your home-based business can improve your financial performance, enhance brand image and reputation, increase sales and customer loyalty, and improve your ability to attract and retain employees.
Here are 10 smart ways to make charitable giving a priority in your home-based business.
- Set a budget. United States citizens contribute an average of 2.5 percent of their personal income to charitable causes. Some businesses with giving programs set aside up to 5 percent of their pre-tax income for contributions. Decide how much money and time you want to devote to charity.
- Make a plan. Don't just donate haphazardly; create an organized plan for charitable contributing. However you decide to allocate your donations, you can't afford to do it randomly. Make a plan, and stick to it.
- Look for the right charity. Think strategically when you select a charity to contribute to or work with. Many businesses seek to align community involvement with their strategic business goals. Look for charities that you believe in and with which you have some affinity and that will give you meaningful exposure to a large number of influential people.
- Perform your due diligence. You probably already get contacted by numerous charities looking for donations. But you can't afford to start giving money to the next charity that contacts you. Make sure that the time, energy, and financial support you are giving truly makes a difference. Check out charities thoroughly before you send a penny. Your local Better Business Bureau can help you ascertain whether or not the charity is legitimate. You can also consult the American Institute of Philanthropy for more information on specific charities.
- Question everything. It's widely known today that some charities, although legitimate, use only a small percentage of donations for their stated goals. These charities "eat up" much of their donations with internal expenses. To make sure that your dollars go where you want them to, request written material that describes precisely how donations are spent, with percentages used for internal operations such as employee and management salaries, overhead expenses, mailings, and solicitations.
- Partner with your chosen charity. If you partner up with a charity, both organizations will benefit. Charities, like businesses, are interested in building their membership bases. The best way to do this is to market to specific niches that are inclined to develop an affinity with your charity of choice.
- Spread the good news. Don’t be shy about publicizing your community involvement efforts. Sharing your efforts publicly will help educate and remind others about the charity or cause you support as well as inspire people to get involved. Tell your local media, customers, and employees, and use your customer newsletter or Web site to get the word out.
- Network. Perhaps the biggest advantage, from a business standpoint, to being involved with a local charity is the opportunity to network with other like-minded professionals. This can turn into a great new source of business for your firm.
- Reap the PR rewards. Clients and customers like to associate themselves with businesses that support worthy causes. Your involvement with the charity can translate into increased sales and goodwill in the community.
- Reap the tax benefits. One of the benefits of supporting a worthwhile cause is the ability to take a federal income tax deduction in some cases. Consult with your tax and financial experts to ensure that you get the maximum benefit from your donations.
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