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Feeling Good About Doing Good

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Feeling Good About Doing Good

The season of giving may be a good time to evaluate how charitable contributions figure into your company’s business model

By By Jim Cory December 21, 2017

A November, 2017 story in The Post-Crescent out of Appleton, Wis., called attention to a project by Tundraland, a home improvement company located in nearby Kaukauna. Tundraland technicians remodeled the bathroom of an elderly Korean War vet who was increasingly experiencing mobility problems. 

They did the work for free. 

Tundraland is one of ten home improvement companies around the U.S. participating in a partnership program called Baths for the Brave, which this year provided about $100,000 worth of installation services free of charge in an effort to make the bathrooms of disabled veterans accessible. Companies who have signed on so far include some of the industry’s largest regional players, such as Reborn Cabinets in Anaheim, Calif., Hullco in Chattanooga, Tenn., and West Shore, in Mechanicsburg, Pa. Brian Gottlieb, Tundraland’s founder and president, is spearheading the effort to build a nationwide network of partner companies aiming to ultimately provide a million dollars a year worth of services to veterans. “As an organization consisting of mostly small, family-owned-and-operated home improvement companies,” says the Baths for the Brave website, “we understand the value of service. For us, success means creating a quality product and providing friendly service to keep our customers coming back.”

Giving and Getting 

Giving back has its own way of giving back. Businesses benefit from community involvement in any number of ways. A big one is employee morale. Marketing consultant Molly St. Louis, in an article at Inc.com, cites studies, such as one by Deloitte in 2016, to make the point that “employees respect companies that care for their community—it simply makes employees feel good, and increases the emotional attachment to their employer.” This is particularly true, she notes, in attracting and retaining millennial employees who, according to the study, were twice as likely to rate their corporate culture as very positive if their company participated in workplace volunteer activities. The Deloitte study St. Louis cites in her article concludes that “corporate philanthropy and volunteerism help businesses attract, develop, and retain talent.” 

Another benefit is tax deductions. Businesses that donate money or property (goods or materials) are eligible to deduct up to 50 percent of the value from their adjusted gross income. (For a list of what’s deductible and what is not, see SBA contributor Caron Beesley’s article “Understanding the Charitable Giving Tax Deduction – What Can Your Small Business Write Off?”

Establishing Corporate Character

But likely the biggest benefit for a business organization engaged in philanthropic giving is the enhancement to reputation that results. Companies known to do good are perceived to be good. “In the social media era, charitable companies will earn a reputation as being ‘good’ companies, and people will be more likely to want to buy from them,” says the blog at Kabbage.com, a company that provides loans to small businesses. Think about an industry such as roofing, which is regularly tarnished in media stories about roofers taking deposits and never showing up for work, or ignoring government safety mandates, or getting busted and going to jail for preying on elderly customers. Among this pack of pirates, the roofing company engaged in charitable giving instantly sheds that onus.

Which is why, well before there was Baths for the Brave, the roofing industry created No Roof Left Behind, a program launched in 2009 that now involves many roofing companies and backing from big roofing products manufacturers such as GAF. The formula is simple: Individuals without means but in need of a new roof are nominated (or can nominate themselves); via online voting, a winner is selected from among four finalists. 

There is no shortage of homeowners who need a roof and can’t afford to buy one. Take, for example, the story of Joe and Cindy Condron. When the Texas couple's uninsured home was heavily damaged by fire in 2014, they received a free new roof from Lon Smith Roofing, a No Roof Left Behind program member. Lon Smith Roofing also operates Lon Smith Cares as well as Roof for Vets, a program similar to No Roof Left Behind, except it aims, like Baths for the Brave, to assist veterans of the U.S. armed forces. 

A Causal Link

Home improvement companies have little to no control over the activities of a small minority of companies engaging in unethical or even criminal practices. What they can work to control is their own image. All politics is local. If the public’s sense of residential contracting is that of an industry rife with lowlifes and scammers, then a local home improvement company engaged in philanthropic work, whether through donations of funds or free services, becomes a standout.  

But the question is: does making a difference in the community make a difference on a company’s balance sheet? Business owners and academics have gone back and forth on that question for years. And the answer, according to Pam Laughland, Director of Strategic Partnerships at the Network for Business Sustainability, is yes. She cites academic research at New York University and the University of Texas at Dallas showing that “appropriate corporate giving programs help firms attract and retain satisfied customers, leading to higher revenues in future years.” This wasn’t true for every type of business, researchers noted: “For firms in retail and financial services, a $500,000 increase in charitable contributions generated $3 million sales. In industries characterized by large business or government customers, the same effects were not present.” Researchers concluded that charitable donations or philanthropic activity  that “improve a company’s reputation, can attract new consumers or make existing consumers less likely to switch.” 

The irony, of course, is that companies engaged in charitable giving improve their bottom line by standing for something more than the bottom line. “If there’s a shared sense of compassion and empathy with a charitable cause you support, customers will feel a genuine connection with your brand,” writes Jane Ashworth, CEO of Street Games, an organization that brings the benefits of sport to disadvantaged communities. “In fact,” she notes, “research shows that 88 percent of consumers say they are more likely to buy from a company that supports and engages in activities to improve society.”

written by

Jim Cory

Senior Contributing Editor

Philadelphia-based writer Jim Cory is a senior contributing editor to Professional Remodeler who specializes in covering the remodeling and home improvement industry. Reach him at coryjim@earthlink.net.

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