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Non-profits are making a profit, and its a good thing

Non-profits are making a profit, and its a good thing

Article · By Jarkko Oksanen on October 13, 2016

Just like with any business, a non-profit has products, customers, sales, costs and profit.

The donation sector around the world is growing by large numbers each year, and more and more donations are done online.

Let me entertain you with an analogy.

Dream is the product

Non-profits business is to reach the funds it can get to do the impact it wants to do. They are selling us a dream.

Dream that we pay money for to see happen.

Buy my dream for $ 20 per month? - Non-profit outsourced freelancer fundraiser who gets paid $50 per signage

Just as with any product, marketing can be intentionally misleading.

Non-profits need to make a profit to make a difference

Employees of non-profits make money. People in these businesses are making money in almost all positions.
We all need to live right? In average in Australia a CEO of a non-profit organisation earns from 80k to 170k per year. This is definitely less than of the for-profit business CEO’s but still something we need to consider.

All people employed by a not-for-profit need to be paid, just as in any business. In many cases volunteering covers a lot of work, but this is just a small chunk of the work.

This means the non-profit must sell enough of its dreams to customers or the government to cover its running costs.

The stakeholder is the cause

All stakeholders want their money when it is due, but just like in business, sometimes this is not the case.

The stakeholder is the cause in the case of non-profit. Dividents are paid only if other costs dont get too high.

A good example of this is the donations in Haiti by the Red Cross that lost practically all of its 500+ million in dreams sold to the costs and different bad structuring. http://www.npr.org/2015/06/03/411524156/in-search-of-the-red-cross-500-million-in-haiti-relief

What you were buying was a dream to a healthy Haiti, but got instead a happy consultant.

Now after the recent hurricane, the cycle is repeating itself. Instead of donating to the first choice, remember to do a slight bit of research. Unfortunately we are missing clear reviews of the ‘dream’ as products.

http://hopeforhaiti.com/

Conclusion

Non-profits around the world are doing great work. But lets remember that everything needs to be sustainable to build something sustainable.

Is it enough to rely on selling dreams to get donations from individuals and government?

Article by:

Jarkko Oksanen
on October 13, 2016

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