Every Dunkin’ Donuts franchisee I’ve ever met talks proudly about the charitable donations their business makes to community organizations. Whether it’s supporting the girls’ soccer team, or buying an ad in a program book or selling car wash tickets for the Boys Club, a franchise owner has many choices for how to be a good neighbor.
And, therein lies the problem. We receive hundreds of requests for money or sponsorships every week. Some of them are from people I know personally; others are blind emails asking for donations. I’m sure most all are legitimate, though, some clearly are not.
When I first got started in this business, I found it hard to decide which group or friend would get the donations. You can’t give money to everyone. So, I asked people I knew within the Dunkin’ system and other friends who owned small businesses how they handled this. What I learned is that you need to establish processes for responding to solicitations, determining what causes you want to support and keeping records.
By no means is our system the only one. There are many best practices that apply in our circumstances, but which may not apply for other franchisees. The majority of our stores are in densely-populated, urban locations except one restaurant in the town where my wife and I both have spent most of our lives—meaning we are often approached by personal and family acquaintances as well.
If there is one piece of advice I want to share it’s this: Remove the emotion from the equation. It’s hard not to be moved by someone’s emotional appeal, even ones that arrive in the mail from people you don’t know.
So, we decided we would no longer consider unsolicited letters sent to the stores. We figured if you can’t take the time to come in and introduce yourself and your cause, why should we divert funds to you. So, we developed a policy whereby all requests are sent to our corporate email account for evaluation.
When we receive a request from a verifiable cause, we automatically send them an email reply so they know we will evaluate their request. We tell them we receive hundreds of requests throughout the year from many needy and deserving groups and we regularly donate goods, money and sponsorships across all of our stores and at the corporate level. We list several of the recurring groups we support and we remind them that we are an independent franchise and that the DDBR Community Foundation has donated over $4.4 million to various causes since 2006; we even give them a link to the website.
One other thing we include in that email – and while it may seem obvious, we didn’t do it at first – is a request that they send a copy of the organization’s 501(c)(3) certificate, proving their non-profit status and, if available, a picture, program, or flyer from last years event. This tends to weed out the fraudulent groups immediately.
Here are some examples of how we determine who gets what:
We generally turn down requests to sponsor groups or provide coupons. We have a couple of groups that we have sponsored for years and if we are to continue with those, we can’t get involved with new ones. As for coupons or special offers, because there are so many local Dunkin’ shops outside our network that can’t accept those offers, we don’t want to be the cause of any confusion—on the part of a store employee or the consumer.
If people are holding an event and want gift cards, we explain how gift cards really work and why we don’t donate them. But, if it’s an event we want to support, we will donate a few dozen donuts and a few boxes of Joe (or more if necessary) so the volunteers can be fed and we can have our product visible to people who attend. It doesn’t hurt when the volunteers tell guests that the coffee and donuts were donated.
We will allow groups that we’ve vetted to post a sign in our window, as long as we can review it for content. We post the signs for one week prior to the event and rotate to the next one.
We allow one booster’s group per month to solicit for donations outside our shop, so as not to overwhelm our guests. I personally speak to the organizer and explain that there must be at least one adult present at all times, the kids must be in their uniforms, have a sign clearly stating the reason for the solicitation, limit the number of kids to two at any one time. Typically we suggest they not directly ask for a donation, but, instead, open the front door and say, “good morning” to the guests walking in or out. That technique tends to raise more money without shaming the guests into donating.
Regardless of the donation, we have a specific procedure for recordkeeping. If the donation is sponsorship or cash, we keep a copy of the cleared check and we request the recipient group provide us with a receipt as well as a copy of the brochure, flyer, or program. This is handy particularly if you are audited.
If we are donating food and beverage – or providing a discount over the retail price – we send an invoice to the organization. The invoice contains the group’s tax exemption number, the event name, the list of goods delivered and the retail costs. After the line indicating the total value of the products, we have an additional line labeled “Donation by our Company” with the corresponding dollar amount, either full or partial.
The invoice reflects the true value of what the group is receiving as well as our generosity. It’s handy if the IRS chooses to question the discrepancy between cost of goods dollars and sales dollars. Invoices also serve as backup documentation to your Radiant (or other POS) records if Dunkin’ conducts an audit.
Non-profits are trying harder than ever to raise money in the wake of a continued economic downturn and cuts to municipal budgets. If you’re like me, you find it easy to sympathize with the many causes and personal stories. And, you enjoy giving your money to support worthy charities. So, do yourself a favor and put policies in place so you’re not letting your heart decide how your money is allocated.