This week’s Fundraising Success online featured the rather startling story of a vendor that was scolded, and ultimately let go, by a client who felt the vendor hadn’t “donated” enough to the client’s cause. (See the Story Here)
When an agency provides a service that helps a non-profit raise money or carry out its mission, those two organizations have engaged in a straightforward fee-for-service contract. The agency has a responsibility to provide the best possible service and in return may charge a fair rate for its services.
Where in that simple equation is there an obligation for the agency to then give extra money to the non-profit just for the privilege of retaining its business? In any other business arena they’d have a name for this kind of transaction: it would be a kickback (which Webster defines as “a return of a part of a sum received often because of confidential agreement or coercion”) and would be considered unethical or even illegal.
The fact is that most agencies, including ours, frequently give extra time and manpower, and discount fees to their nonprofit clients, because we understand that non-profits are margin-sensitive, and that most of them are doing good work in the world.
So if, within that context, the agency chooses to support its client’s cause out of a sense of good corporate citizenship, that’s great. What rankles though, is the expectation that somehow an agency owes it to their clients to simply give them money above and beyond the fair value of their contract.
As to the Foundation that so rudely strong-armed its vendor: the vendor is almost certainly better off without them.
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