Tuesday, May 21, 2013

The Hidden Cost of Online Donations

One of the big takeaways from Frontline's recent story on the looming crisis in retirement accounts is that for all the efforts spent on deciding proper asset mix and risk tolerance, it is sometimes the little things that count most.  In that case, the "little things" were the fees passed on by actively managed funds that can quickly erode returns without employees even realizing it.  When watching that episode, I could not help but think of the similarities to small costs eroding charitable activities.  In this case, for all the concern about what charities do with donor money (which is, of course, justified), there are hidden costs that actually limit what donor funds even reach charities.  In this case, the important "little things" are credit card and processing fees that slowly cut into donations.

Friday, May 17, 2013

On the Locks of Love Scandal

Recently, the group Nonprofit Investor released a report on the well-known charity Locks of Love (which collects donations of hair to make wigs for underprivileged children with hair loss).  The scathing report accuses the organization of having over $6 million in unaccounted for hair.  The report makes some good points, but there are also some clear flaws.  I will discuss both.

Wednesday, May 15, 2013

The Big Three of Professional Fundraising

As discussed in this blog many times before (see here, here, and here), the inefficient use of professional fundraisers is unfortunately quite common among nonprofits.  As it turns out, there are three groups of organizations that are particularly notable in this regard: police & firefighters, children's cancer, and breast cancer.


Tuesday, May 7, 2013

The American Cancer Society's Bold Move on Direct Mail

In a surprising and bold move, the American Cancer Society (ACS) recently revealed that it is drastically cutting back on its direct mail activities aimed at soliciting donations.  The full details of this move are excellently described by FundRaising Success Magazine.  My focus here is on the financial aspects leading up to this decision and its possible ramifications.