Regarding any charity group, it is safe to say that there are efficent ones, not efficient ones, and then scoundrels. Specific to this recent report on charities serving veterans, it is important to note that a least one of the charities, Disabled American Veterans, which is given a "D" by this article, is in the Top Ten best run charities with Charity Navigator (along with Fisher House),
was selected in May 2007 by USA today as the only veteran charity to be listed in that papers 25th year highlights... and is a charity that companies no less than Harley Davidson and GE have donated millions after extensive financial study.
So who should the public believe: A reporter... an benchmark %, or real accounting figures which reflect the ACTUAL?
It said that liars figure and figures lie. I'm not calling anyone a liar. However, I am about to show how figures CAN BE (may not be... remember there are scoundrels running bogus charities) misleading.
If one's only benchmark is the percentage of dollars delivered to the charity's target over the total amount of money raised is the sole criterion, then there will surely be a distortion -- and most likely a failing grade for any charity which attempts to raise money through ACTIVE business-type efforts. Here's why.
Just as it cost money for commercial endeavors to build awareness, perceptions, and preferences... it costs money for a charity -- no matter its nobility -- to come to the fore of the public's consciousness.
Of course, if the first step is a charity bake sale where all goods are donated... DOLLAR ONE IN can also be DOLLAR ONE OUT for there are no costs (assuming no overhead in this simple model). However, if the nacent charity does not have volunteer organization and decides to get to "market" through a legit direct mail solicitation, that charity begins its fundraising IN THE HOLE... with not only the cost of production and postage... but the same realities of direct mail response rates. Clearly, in this this model, DOLLAR ONE IN cannot go to deliver benefit to the target of the charity, but it must go to pay for the legitmate costs of production.
Moving forward, it gets more interesting, for charities, which fear reports such as the current, learn the "game." DON'T SPEND MONEY.
Instead they rely on volunteers and donations that are garnered through volunteers. The end result of this entire process often has been that many charities allow themselves to becomed "pimped," where they allow themselves to become oblivious to the how the overall money is raised... so long as the money that they receive DOES NOT COST ANY OUTFLOW OF CASH... just the use of their name. If one studies the financials of such charities, one will find EXCELLENT ratios (assuming no scoundrel is in the midst), for every dollar that comes through the mailbox had no cost other than the use of its "brand name." Is this noble? Is this reflective of the charity? Is this reflective of t
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