Hidden Resources
Think nonprofits have no money to spare for your company? Stop ignoring this $621 billion market.
Does it seem like every time you turn around, a charitable
organization is hitting you up for a contribution? You've
probably bought products, sponsored events and written checks--but
have you considered that these nonprofit groups might be potential
customers?
If you think "nonprofit" means "no money,"
think again. With more than 1 million nonprofit institutions in the
United States--schools, hospitals, human services agencies, arts
and cultural organizations, religious groups, and more--employing
nearly 15.1 million people and generating revenues in excess of
$621 billion, this is a market worth a good, hard look.
Growth in the nonprofit sector has mushroomed in recent years,
and although governments continue to reduce funding for social
programs, that growth is expected to continue. And beyond the
nonprofits themselves are their stakeholders--the supporters,
members and funding sources that may also be potential markets for
your business.
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What do they buy? Just about everything. For example, nonprofit
associations are a significant market for insurance, printing,
travel services and technology, both as end users and as the
conduit to sell such products to their members. In fact, working
through a nonprofit can be an excellent way to reach consumers.
Sandy Suarez Boutin knows this well: As the director of Great
Dane Rescue Inc. in Plymouth, Michigan, Boutin is always in need of
dog food but has a very limited budget. So she invites pet food
manufacturers to participate in her group's fundraisers. The
dog food companies get their names out in front of a big group of
prospective customers, and in return, they donate food for the dogs
in Boutin's shelter.
The most important point to keep in mind: Nonprofits consume the
same goods and services for-profit companies do, and for the most
part, they pay fair market prices for those products. Which is not
to say you should market to nonprofits the same way you do to
for-profit customers. While there are many similarities, there are
also some distinct differences between the two sectors--differences
that are important to grasp if you want to succeed in selling to
nonprofits.
Contributing writer Jacquelyn Lynn regularly writes
"First Steps" and "Your Business."
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