Remember that the most critical process for you is to evolve a simple transaction (a company buys a table at an event), make sure that it is reinforced by a relationship (a senior executive sits on your board), and develops into a true partnership (a mutually beneficial exchange involving promotion and co-branding and a number of people, including employees and volunteers, over time).
It’s important that when you open the doors with a business and begin to build relationships and create the groundwork for a long-term partnership, the dialogue doesn’t have to be re-initiated for every one of your nonprofit’s events or projects. Too many emerging nonprofits operate in the moment, hand to mouth, whereas businesses are more likely to have quarterly and annual plans. To credibly present your cause, don’t call a business owner and simply ask him/her to make a donation or buy a table at your fundraiser. You might get a yes, but this kind of interaction doesn’t instill a real relationship.
To ensure a long-range view and be able to offer value spanning at least 12 months, you need a written letter of agreement for the business owner. Don’t start with this kind of document–but have it ready “for consideration” when your conversations have covered mutual goals and interests. Be ready to customize it to reflect the unique needs or resources of the business, and expect to incorporate the comments of other marketing or community relations executive(s) before you’re ready to sign it together. These things take time, but the buy-in and clarification are invaluable.
A letter of agreement between a nonprofit and a business partner/sponsor should include the following:
- Why is this agreement being made? Start with a concise summary of your mission as well as your understanding of the pertinent marketing/PR or positioning goals of the business. State the value proposition.
- Who are the key players? Identify the point person in each organization, with titles and contact information.
- When is the agreement in effect? It should have a start date and a “renewal” date, like a contract. Skip the legalese, but protect your work and the relationship.
- How will the partnership be promoted? Be as precise as possible about the emails, printed material, media releases, banners, etc. where the business will receive recognition for its involvement.
- What is the specific wording and description of the main components, i.e., “ABC Healthcare presents the DEF Nonprofit Annual Gala,” or “Our 2011 Program Sponsor, ABC Healthcare.”
- How does the relationship play out month by month? You might want to include a calendar or timeline.
- What promise is made on exclusivity? Will you have promotional relationships with other companies in the same industry? This can be a deal-maker (or breaker) and must be defined in writing.
- What exactly does each entity bring to the table? Consider bullet points, i.e., “DEF Nonprofit will provide the following,” and the same for the business. Include dollar amounts along with in-kind contributions so there is no chance for misunderstanding later.
- Address certain graphics standards or branding issues that may be involved such as logo size/color, required taglines, and reciprocal web links.
- Establish a feedback and evaluation process. What does success together after 12 months look like? Do everything you can up front so that the partnership’s renewal in the future is a no-brainer for all concerned.