The study entitled “Is Doing Good Good for You? Yes, Charitable Contributions Enhance Revenue Growth” found that for every dollar spent 2 to 3 dollars is returned in sales. The study looked at 251 corporate donors from the years beginning in 1989 and ending in 2000. Professor Baruch Lev at Stern School of Business states that even though corporate giving is a profitable endeavor most companies spend very little doing it.
Sales increase because your business develops “goodwill” where consumers feel that you are a good corporate citizen. This positive impression helps customers to have a positive impression about your business and the products you are selling. If you had a choice between a company that doesn't care about others and one that does, you are most likely to choose the good corporate citizen.
Small businesses can engage in corporate goodwill by sponsoring local events, charities and scholarships. For a small business, a $500 dollar donation can go a long way if you get the chance to speak at a dinner function, have your business posted as a charitable organization in the local newspaper and have a nice placard built in your honor. Your local little league team will love you as they advertise your business each and every time they charge out on to the field. Let us not forget that a small park refurbished with your business's name posted on the fence will be seen by hundreds of local residents.
The second advantage small businesses receive is through the feelings that others hold about the business. People who work for businesses that give to their neighborhoods and communities feel good about the jobs that they are doing. They are doing more than a paycheck as they engage in these wonderful events. The status of your business in the community, the feelings of your employees and the amount of work you have to do to get a sale make small business giving a positive investment.
Ideas for small business giving:
- Local charities.
- Local sports teams.
- Parks, buildings and other places of disrepair.
- Holiday donations for the poor.
- Scholarships and educational materials.
- Local political campaigns.
- Environmental works such as “Ducks Unlimited”.
