Why Higher Fundraising Profits Won’t Guarantee You More Money

We’ve seen it time and time again. Fundraising groups that are more organized, offer better ideas that motivate their students and work hard to promote their sale will almost always out-perform those schools that are primarily focused on what fundraising profit they are able to obtain.

We talked with a school yesterday who was especially interested in receiving a 5% increase in their profit but were not interested in offering any additional fundraiser incentives above and beyond the basic prize program that would motivate more students to participate in their sale. This is what this school failed to comprehend:

• Above Average Results: Profit + prize program + additional incentives
• Average Results: More Profit + prize program

What this school failed to realize is that even with a higher profit, the total amount of money that they will bring in will probably be lower because they are not doing enough to increase student participation with just the standard prize program. As a result, they will probably end up making a higher percentage out of a smaller money pot. In other words, they should be focusing on ways to make their fundraiser stronger.

Content with the Status Quo
Most fundraising companies are all alike. Instead of attempting to offer better and more effective school fundraising programs that motivate more students to sell and that bring in more customers, they continue to market average quality products with the same mediocre price programs but, as a tradeoff, offer more profit. This is what schools have come to expect. Yet the result often leads to customers being dissatisfied with the quality of the product, students who are disappointed with the prizes and schools that are achieving average sales results.

Unsustainable Results
Many schools have found that even though their sales may have been acceptable in the beginning; over time, fewer customers buy due to a lack in product quality and older more savvy students cease to participate because they become accustomed to how the fundraising system works. Therefore, less students participating and fewer customers buying can only lead to one thing, lower sales.

False Illusion
Some school sponsors feel that if they get a higher profit percentage then they don’t have to work as hard on the sale. We’ve seen this time and time again. Sell the same amount of items and make more money without having to put the time in. Plus, they think that even if they don’t sell as much, they can still make up for it by receiving more from the items that they do sell. The problem with this mindset is that it often leads to fewer students participating in a less desirable fundraiser.

The bottom line is that your students are the engine that drives the success of your fundraiser and they don’t care about what profit the school makes. They want to know what’s in it for them. So, how can schools really make more money? Increase fundraising participation by offering better products in their fundraiser brochure and a stronger incentive plan even if they have to accept a lower profit percentage up front. We’ve been witnessing great results from schools that have believed in this approach for years.