The business benefits of working with charity

The rewards and perks of working in the craft beer business are quite great: beer; good camaraderie; fun; more delicious beer; and, hopefully, some profits. It is hard work, but definitely worth it. What happens when it comes time to share those rewards with others, specifically charity? The altruistic, feel-good tingles aside, a part of you may be asking, after scraping together the cash for startup and working harder than you ever have in your life, “Why should I share what I have worked so hard to earn?” Cash is important to the survival of your business. You need it to pay for your staff, buy materials, keep the lights on and, hopefully, pay yourself at the end. Giving it away seems like the last thing you should do.

Looking at it that way, if working with charities was only about that personal, feel-good emotion, fewer businesses would be doing it. The business benefits of working with charities are there, but you need to be strategic about your giving in order to support your business goals. There’s more to giving to charity than just handing over cash.

Why should my brewery work with charities?

Besides giving back and tax deductions, one of the main reasons for working with charities starts with the same reason you sell good beer… people want it! Surveys show that consumers are willing to reward companies that give back to society by buying their products, even at a higher premium. This trend is particularly true with the Millennial generation and attitudes among Generation X are shifting to this view as well. This is particularly important as these two generations appeal most to craft beer (49 percent of Millennials and 40 percent of Gen Xers). Marketing is knowing what your target consumer’s interests are, and their interests are supporting businesses giving back to the community.

Another reason for working with charity is that giving back to the community can improve employee engagement. It is hard to believe that sometimes people in the beer industry become disengaged with their jobs, but it does happen. In a Gallup poll of 350,000 employed people, 52 percent were disengaged with their jobs and 18 percent were actively disengaged; Gallup estimates that actively disengaged employees cost the economy a total $450 billion to 550 billion per year. By creating volunteer programs with your brewery staff, you can increase employee engagement that then reduces turnover and can help attract new higher talent. In a survey by Net Impact, 53 percent of workers want a job where they can make an impact. By having employees volunteer and work with charities, a brewery can actually see turnover costs decrease.

Finally, in an industry that is flooding with new entrants every day, working with charities can help improve your brand image and gain a competitive position. Craft breweries are supportive of one another; no one wants to see another brewery fail. However, you are running a business and everyone at your brewery needs to take actions to be sure the brewery succeeds in the long-run. By working with charities, you can add affinity groups outside your normal target audience to gain new customers for your brewery.

For example, in the Denver area more than 90 breweries exist. These breweries rely on certain assets: location, food sales, and having a niche selection of beer styles. However, as more breweries continue to open, not all breweries can count on these assets. Working with charities can build stronger relationships with customers to make them more passionate about your mission.

Getting involved with charity … and not with your cash

As established earlier, cash on-hand is thin and designated ahead of time to go to several different places. Getting involved with charity does not mean you give away your money. There are several initiatives that do not require breweries to give away money, such as collecting items, allowing a charity to use taproom space for free to host their event or informing people of volunteer opportunities.

When starting to work with the community, one of the first things a brewery needs to do is set a goal of gaining credibility with the community. This means you need to be able to show that you understand issues going on in the community. This means knowing in-depth why the problem occurs and what is currently being done to solve it. Being able to demonstrate your knowledge of the issue and creating purposeful solutions with a charity makes a larger impact and proves that you are a credible community member.

Aiming for this goal means you should only focus on two or three charities as core causes. Establish long-term relationships with these charities and ensure the causes are something that brewery ownership is passionate about and/or has a good fit with your brewery’s brand. Choose charities that fit and work in your same community. Bigger charities have a larger total number of supporters and resources which can help share your brewery’s partnership to a larger audience, but ensure the charity has a local presence. You can also choose to work with a larger charity if your goals are to expand in similar regions. A smaller, local charity may have a more passionate, involved support base which can provide your brewery with a better understanding of local issues and a deeper relationship. The main goal of a relationship with a charity is to make the relationship long-term, so you can expect long-term mutual benefits.

Many breweries have monthly events where a new charity is picked every month. These initiatives are great for exposing the brewery to new audiences, but the impact for those charities is minimal and short-term. As a brewery, you should utilize both types of initiatives to make small and big impacts.

When it comes time to give away money, view it as you would any other item you are spending money on. Set a budget, track and ask “What returns are we getting out of this?” It appears that most newer breweries do not have an established marketing budget for the year; it seems to be more of a “we will see” type of decision-making. Many of the activities that breweries conduct with charities are events and targeted marketing. Find out what your return on investment is for your monetary and in-kind donations. By doing this, you can actually see the measurable benefits to your business.

Working with charity: Is it just tooting your own horn?

No, it is just like taking pictures of the newest batch of your IPA and posting them to Instagram. Your followers are interested in all aspects of what is happening at the brewery, including how you give back. Your fans cannot follow and be involved with your work with charities without you telling them what is going on.

Promoting and reporting are important. Create S.M.A.R.T. – Specific, Measurable, Assignable, Realistic and Time-related – goals around the impacts you want to make for the cause. Then, make the goals public and track your progress. When the brewery has made a major achievement in contribution, let people know. It is important to keep messaging around the cause, understanding the issue, and what the brewery is doing to help. The messaging should not be about how good you are as a brewery because you donate money or volunteer; that is when it becomes tooting your own horn.

“Charity work” is more than just giving money away, it is working with charity. Treat it as seriously as any other responsibilities of running a brewery. View it as an investment in your business, which is a part of the community and the people that support it. Create interdependent relationships with shared values and benefits.

Brian Phipps is a Colorado native and passionate about helping the community. He learned the importance of volunteering and giving back through organizations, friends and my family and has worked in the nonprofit world for 10 years with several corporate partners to obtain donations, as well as publicize and report returns on those contributions. For more information about Confluence LLC, be sure to check out the company’s website.