Giving back should be a part of every small business’s agenda. It’s their corporate social responsibility (CSR), which isn’t required by law but highly encouraged nonetheless. Socially responsible businesses enjoy marketing perks. Consumers today factor values into their purchase choices. They’re willing to pay more for a product or service made by companies that give back.
But if your small business isn’t philanthropic, that doesn’t automatically make you socially irresponsible. There are other ways to fulfill such responsibility, after all. Adopting sustainable practices, like ditching plastic packaging, for example, is also a form of social responsibility.
The goal of CSR is to be a positive force in society. Hence, as long your community doesn’t suffer because of your operations, your business is considered socially responsible. But still, donating money leaves a bigger impact. It actively changes lives and teaches selflessness to your team.
The Advantages of Giving Back
Aside from changing lives and learning selflessness, your small business can also receive tax benefits from donating. Charitable contributions to non-profits can qualify for tax deductions. Provided that, the non-profit you donate to is registered.
However, claiming your tax deductions may present some challenges. In the U.S., for example, the Tax Cuts and Job Act of 2017 can stand in the way. Thankfully, there are ways to get around it. A donor-advised fund is one way. It allows your small business to donate a particular amount of money in one year so that it can be eligible for tax deductions while the donor-advised fund withholds the money. Your business can then distribute the money from the fund over the course of several years.
In addition, your philanthropic commitments can encourage your customers to buy more. For example, if you sell a pair of socks, you can start a program in which a bundle of socks can result in a donation. As such, customers would buy a bundle instead of a pair. This way, their money goes to a product they want and a person in need.
Ways to Increase Your Impact Without Spending More
Many small businesses worry about losing profits to charity. But that shouldn’t happen at all. Committing to philanthropy doesn’t take away your right to enjoy your profits. Focus instead on the impact of your donations rather than their amount.
Consider these cost-effective ways to increase your impact without spending more:
Donate Goods Instead of Cash
While donating cash allows non-profits to fund their programs, in-kind donations can immediately go to a community. As such, it may change lives faster. There are many communities that can use in-kind donations right now. Among them are the victims of typhoon Rai in the Philippines. The typhoon struck on December 16, 2021, but until now, the victims are still recovering. Many have been homeless since Christmas. Humanitarians are worried that this will increase the malnutrition rate in the Philippines. Hence, your small business can donate cans and packs of food to the victims.
Start a Volunteer Program
Volunteering allows you to donate your time instead of your money. Of course, there would still be monetary costs involved, but your greatest investment here would be your time. Consider visiting a disadvantaged community and tutoring its children, for example. You can also hold free livelihood seminars for impoverished communities. Visiting an orphanage, animal rescue center, or mental health facility is also an amazing idea. It can teach invaluable life lessons.
Start a Donating Matching Program
In this program, your employees make donations to a particular charity, and your company matches it. That way, you can double your contributions without spending more. Use donation matching software to keep accurate records of your employees’ donations.
Make a Donation For Every Product Sold
Take inspiration from STATE Bags, which fills a schoolbag with school supplies for every STATE bag sold. The filled school bag is then given to a local student in need at the “Bag Drop” rally. The company also raises awareness about certain social issues and movements like mass incarceration, Black Lives Matter, and the Flint water crisis. It’s part of their #WhatDoWeTellTheKids initiatives.
Partner With a Local Charity
Partnering with a local charity allows your business to donate and volunteer consistently. You can participate in the charity’s events, for example. If they’d hold a feeding program, your company can help distribute food to a community. The initiative can also come from your end. You can start a fundraising event, with your partner charity acting as the facilitators.
Note, however, that donating will always involve a small sacrifice. No matter how much you try to minimize costs, you can’t change a life without giving something in return. So don’t focus on what you’re losing. Remember that giving back returns blessings ten-fold.