Economics of Charity Walks

Factual Questions
1

This past weekend, my wife signed our family up for a 5K walk for charity. This is my first time attending one of these things, and I was kind of boggled by the whole affair. Her company apparently raised about $3000 for their 60 walkers in the event and matched it, for a total of ~$6000 going to the charity.

Now, we all got team t-shirts provided by the company. When we arrived, we parked about 2 miles from the event, and were bussed on a shuttle bus to the site. At the site, we received a 2nd T-shirt from the event organizers, then hit the food tables, where there were piles and piles of fruit, cookies, bagels, hotdogs, yogurt, trail mix, sausage sandwiches, water bottles, chips, cotton candy, hot pretzels, granola bars, etc, etc. all free for participants.

Then the kids hit the “kids’ tent” where there was face-painting and sand art to be done.

Finally the walk started, and we got about 2K into the 5K when the kids started complaining and it started pouring rain, so we called it a day and took the shortcut to the finish, grabbed some food for the road (they had so much surplus they were practically forcing it on us), passed through the vendor tent where we were given goodie bags of band-aids, robitussin, rubber bracelets, etc., got back on the shuttle bus, and drove home.

I came away from it all very cynical. How much of the donated money could possibly have made it to the charity? (Not even talking about the charity’s overhead and such once the day is over and the net income is actually in their account) And how much went to pay for the busses and food, and tents, and sound system for the announcements, and racing bibs, and tshirts, and police presence and cleanup crew. OK, yeah, the food and goody bags were probably donated by local vendors but still…

Was it really less than $100 per walker?

I wonder how much more good could have been done if everyone just stayed home and wrote a check.

Is this a usual occurrence? Is there any data on how much a charity nets for holding these things? Or is the value in the “awareness” of the cause (which I also find dubious, since people are more likely to curse the inconvenience of a closed road than look into the reason for it.) Is this a uniquely American phenomena, or does it happen elsewhere? (because watching everyone chow down on a few thousand calories before walking 3 miles sure felt very American…)

2

Many of the goodies and services you got may have been donated to the event rather than paid for by the organization running the event.

But regardless of the bookkeeping practices, I’m sure that the total dollars actually going to fund the … cancer research, or whatever … is only a tiny percentage of the money spent on the event, and there surely ought to be ways to increase the percentage.

And sure, if everyone contributing to the event would simply write out a check to the charity, it would be tons more efficient. The question is how many of them WOULD write that check without being enchanted by all the hoopla and the experiences of being part of an event.

3

Here is a five-year-old article from Market Watch about charity walks. A person who organizes such walks suggest that the costs might eat up half the revenues, so the charity only gets 48% of the money.

4

But a lot of people who contribute to a walker will become life long donors even without walking events. Around five years ago I sponsored someone in a marathon and have continued donating to that cause ever since. Sometimes the hoopla to get someone to give once pays off in the long run.

5

Alternately, though-can you get a higher yield with a straight request for money minus all the hoopla? If not, then this “imperfect solution” may be the best one available.

6

[QUOTE=gonzoron]
I wonder how much more good could have been done if everyone just stayed home and wrote a check.
[/QUOTE]

It’s all about the engagement factor. Writing a check is boring. If you just ask people to write a check to the Stomp Out Icky Diseases Fund, well, good luck. If you tell your friends and co-workers that you’re participating in a 5k or whatever walk to benefit SOIDF and would appreciate their support, people are much more likely to open their wallets as you’ve put a face on the thing, especially if you can say that your mother/sister/kid’s teacher/etc has Icky Disease and is hoping someone finds a cure. Your friends are much less likely to tell you no, compared to getting a postcard in the mail asking for a donation and tossing it immediately into the recycle bin.

As others mentioned, there’s a huge dependence on “in-kind” donations to make the actual event work well. Tshirts are cheap in large amounts, especially if you’re not picky about using a “premium” brand like Hanes Beefy-T and you keep the design simple. All of the food and swag bag stuff was almost certainly donated by local businesses. A good event planner is worth their weight in gold and will know at least half a dozen people who have and are willing to donate the use of sound systems, lighting, generators, easy-up canopies, etc.

I was one of the organizers of a fundraiser a couple of years ago and once you wave that magic “We’re a 501(c)3 charity” at businesses, you’d be amazed what they’ll donate. I got several “Midnight Sun” mobile light poles with generators, a PA system, tables and chairs donated by a rental company without even trying hard. For the cost of sending someone to fetch them on the day of the event, I got free pizzas, and a local shop donated a new $400 sewing machine as a raffle item.

7

I work for a charity and run my own walks and I tell you, we run cheap. Looking at your list:

  • Team tshirts
    We get these pretty cheap, but admittedly, we don’t run individual team tshirts. When you say that, do you mean that they had your company’s logo on it? We do provide team tshirts to the site sponsor, one company that gives the most money. Instead, we run shirts that all have the same logos and give them to people who raise a certain amount.

  • Busing
    We get bus companies donating their time and money or maybe charging us a minimal amount, or they sponsor the walk to be able to get their name out there.

  • Food
    One of my walksites has 100% of the food donated. The other probably gets about 85% donated. This includes all kinds of things, including water, soda, treats. We don’t give out a second tshirt here, though!

  • Kids tent
    Our charity is all about kids and we encourage kids to come, so we do try to have something for the little rugrats to do. We try to get the kids tent sponsored, but this is one thing we do often eat the cost. The facepainters donate their time, and the entire event is staffed by volunteers.

  • Goodie bags
    The only time I have ever had goody bags is when they were sold as a sponsorship. So, for like $150 you could get a sign on the walk. For $250 you could get a sign and add a thing to the goody bag. Even my bags were donated by a sponsor. Volunteers put them together.

  • Sound system
    We have an exclusive media sponsor that donates all that and sends one or two out of their DJs at every event.

  • Police
    Sometimes we have to pay for the officer’s time. Sometimes they come to support the community.

  • Tents
    We do pay for these and try to look for lowest price.

  • Bounce House
    We only have it if it’s 100% donated.

Our company returns about 80 cents of every dollar to the mission. We run lean and mean. People don’t know how much work goes into every walk, how many freakin phone calls we make to get everything donated, how much asking we do. I don’t know if your charity is like this or not. All I know is charities are under a ton of scrutiny at all times and we’re all very careful.

Also, no, people don’t just write a check. They want to come out and make it a community event. So we have to have the hoopla.

8

I wouldn’t have worked for me. If my neighbor’s kid hadn’t run in the Boston Marathon I’d have never given a cent to The Jimmy Fund.

9

No cites but my business professor told me that events like this are useless in terms of money. They do however create awareness of course.

10

Lots of people do simply write checks. I’ve sponsored every neighborhood kid that comes to the door and everyone’s kids from work. I’ve “participated” in lots of walks and never been to any of them.

11

But, it’s the kids participating in the walks that got you to write those checks. In the context of this discussion, the question is: would people “simply write checks” to the charities involved in the walks without the impetus of the event (i.e., would you have made a donation to that charity anyway)?

12

I understand. My point was simply that many (if not most) of the people “participating” in the walk are not actually there and aren’t eating the food or getting t-shirts or costing the charity anything in any way. The economics of it all are not necessarily transparent.

13

I don’t think it matters that a bunch of people only wrote checks, as it still costs a bunch of money to operate a charity walk, and those costs can consume half or more of the amount raised.

14

If the expenses to put on an event really consume half of the proceeds, I’d like to see the accounting.

The event I produced back in 2013 raised a bit over $5,600, and we had “hard” costs against the event of just under $100. Of course there were countless “soft” costs like paper and ink for printing tally sheets, etc. on my home printer, phone calls, gas to drive out to pick up donated items, and so on that individually aren’t worth the time to log.

15

I guess I must be on everyone’s ignore list?

16

Sure it costs a lot to operate the walk, but as indicated above, most of the food, transportation, tents, table, etc. are donated by businesses. If there is wasted money, it is the businesses wasting the money. But they donate to help the cause and/or support valued employees who support the cause. Their contributions are a key component in the entire process. I understand someone thinking that effort and money is “wasted” as not going to the charitable cause, but the fact is asking for money without a walk/run/auction fundraising event doesn’t get the same results.

I have seen cards mailed out which ask for $50 for a stay-at-home charity dinner, explaining that it’s better because there is no dinner to go to, so no need to dress up, hire a babysitter and waste an evening. You get to put on sweats and stay at home, and mail in a check. Sort of clever, but I suspect that it doesn’t raise as much money as an actual dinner/auction type of event.

17

No, you wrote a very helpful, insightful post.

18

Perhaps these things are donated. Or perhaps, as in the article I linked to, these costs are borne by the charity organizers and these costs eat half or more of the money raised.

19

Thank you, I was mostly just teasing. :slight_smile:

20

I can’t seem to make the link work, though I’ll keep trying. But there is no doubt that some walks just fund it all. It very much depends on the company environment. Plus there’s the feeling that you do need to spend some money to make some money. I am in charge of walks, and the walks run cheap. We also run a sort of Gala and we spend a lot more on that, though we still try to run as cheap as possible. For example, for the Gala:

  • we rent the space
  • We will probably pay 50% on linens, if the space doesn’t have it
  • We get an exclusive valet sponsor, so we don’t pay for that.
  • We probably pay 50% on the silverware, if the space doesn’t have it.

For the walk, I can get all of my paper products donated - I don’t need fancy metal ones. But the gala is a dressup event. People expect class, and we market it to a different social class.
Ah! I got the link to work. Please note that runs and walks are vastly different beasts. Runs are much more expensive. More on that in a moment. From the link:

2% Toilets (one $40 port-a-potty per 50 racers) and cleanup

  • I don’t rent toilets unless I have to, and we get a 50% discount from the company. Cleanup? HAHAHAHAH! I clean the site myself and maybe I’ll have volunteers.
    • 2% Online fund-raising commissions
  • We actually have this great thing now where you can add a little extra money to your donation to cover credit card fees. That’s new for this year. But yes, we do need to pay the online fees.
    • 3% Signage; start and finish lines
  • Signage is basically sponsored by the company. A sign that the company buys for $150 probably only costs us $10. BUT what you are getting is full of value: access to our constituents.
    • 5% Pre- and postevent furniture (tents, tables, chairs and a truck to haul them)
  • Yes, we do rent tables and chairs and tents, if we need them. As I said, I am constantly looking for the lowest bottom cost.
    • 6% Entertainment ($750 for an event emcee; $1,500 for a venue rental and a sound system)
  • I don’t pay for any of this. It’s all 100% donated.
    • 6% Event T-shirts (prove you were there!)
  • Tshirts are purchased, but they are given to participants who raise a certain dollar amount, so it’s worth it.
    • 6% Water and snacks ($3 a head)
  • I don’t pay for any of this.

Ok, here is where it gets expensive for races. I don’t have any races so I have no idea if this stuff is even necessary:

• 7% Race gear (for each runner, a $3 tracking microchip and a 15 cent bib)
• 7% Fences and barricades (to keep spectators from straying onto the course)
• 8% Permits and security (think 20 cops at $40 an hour and a $500 backup ambulance)

  • Again, this is the cost for a RUN. I hire a security guard at my two biggest walks and they cost about $600 TOTAL. I don’t have security guards at the others. I don’t have a backup ambulance. One of my walks is sponsored by the local ambulance company, they are always on site. The other? We will call the local 911.

But you know, we are a WALK. A 3-mile walk, meant for families. I don’t get a lot of accidents worse than a cut or a scrape. Once a lady tripped on a sidewalk. Ten years go! And it was the City’s problem.

Runs are a whole different kettle of fish…which is why they make you pre-register and make a minimum donation. I have neither of those requirements for the walk!