Why we’re done with charity businesses {hint: unsustainable}, by Hoboken411

If businesses charge more to cover their charitable activities, aren’t they requiring customers to pay for those activities? From Hoboken411 at theburningplatform.com:

I can think of really only one of the “charity businesses” from back in the day. And that was Newman’s Own products. Their big selling point was donating all “after tax profits” to charity.

To put that in perspective – Newman’s Own had $600 million in sales last year and donated $30 million to charity (their own charities, naturally.)

That, of course, includes salaries of everyone involved. And whatever “cooked books” accounting. Some would say a 5% “leftover” seems to be a bit low of a profit margin. But then again, companies like Uber are losing $700 million a quarter (or something like that).

But charity businesses is the flavor of today

Fast forward to today. It appears that EVERY OTHER BUSINESS out there has some kind of “charity” link. Take a better look at all the packaging of food, for instance.

“We donate X% of our profits to kids in need!” seems to be the common mantra. You can expect cooked books accounting in all these companies, too.

And then there are companies like TOMS Shoes – who donates a pair of shoes for every pair that is purchased – to someone “in need.”

TOMS is now in jeopardy of going BANKRUPT.

If companies are so charitable – maybe you’re paying too much?

I understand Newman’s (to a degree).

But all these other companies are practically riding that “socially acceptable” coattail to have a positive light shined on them. I mean, who can bash a company for “helping” others?

Well – there are several problems with this whole thing.

I think for one, they build the “cost” of their charity into the price of the goods. Wouldn’t you rather have THE OPTION to pay LESS for the product instead? What if you didn’t like that charity? Or were having money problems yourself? These companies – regardless of their (artificially perceived good intentions) don’t realize that not everyone is so pliable.

To continue reading: Why we’re done with charity businesses {hint: unsustainable}


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