Can a Nonprofit Charge for Services and/or Sell Goods?

charge for services or sell goods

A nonprofit can sell goods and services, but you need to be aware of some restrictions. In this article, we will explore what those restrictions are and give examples of merchandise and services that nonprofits can sell.

 

Can a Nonprofit Sell Goods and Services?

So, can nonprofits sell goods and services? Yes, you can! Though nonprofits cannot make a profit, you still need to make income in order to support your cause. Merchandise, goods, and services are great ways for a nonprofit to increase revenue. Therefore, nonprofits can sell goods and services as long as you use the money to fund your programs without providing any profit to stakeholders.

 

Restrictions on Selling Services and Merchandise

There are a few restrictions that nonprofits need to be aware of when selling goods and services. First, as we mentioned before, the goods or services must be related to the mission of the nonprofit. Additionally, nonprofits can only sell goods or services at reasonable prices. You cannot charge an exorbitant amount just because you have a nonprofit. Furthermore, your nonprofit cannot use your goods or services to unfairly compete with for-profit businesses. Lastly, any revenue generated from selling goods and services must go back to your nonprofit to support your programs – it cannot be distributed among stakeholders.

 

Ideas for Nonprofits in Selling Merchandise and Services

Now that we know what restrictions there are to selling goods and services, let’s explore some ideas for merchandise and services that nonprofits can sell.

T-shirts:  T-shirts are always a popular item, especially if they have a catchy phrase or design. Nonprofits can sell t-shirts to both supporters and the general public. All of the proceeds should go back to the nonprofit.

Toys: If your nonprofit works with children, selling toys can be a great way to generate income.

Coffee or Tea Mugs: Like t-shirts, coffee mugs are popular and can be sold to supporters and the general public.

Programs: If a nonprofit offers programs, they can charge a fee for these programs. For example, if a nonprofit has an after-school program, they can charge parents a per-day or monthly fee.

Training: Nonprofits can also sell training sessions. This could be anything from cooking classes to financial literacy courses.

Consulting: Nonprofits can provide consulting services to other nonprofits or businesses. This can be a great way to generate revenue while also helping others.

Events: Nonprofits can also charge for tickets to events that they host. For example, if a nonprofit hosts a gala, they can sell tickets to the event.

 

Conclusion

There are many different ways nonprofits can sell merchandise and services.  The important thing to remember is that the income generated must go back to the nonprofit and cannot be distributed among stakeholders. Selling goods and services is a great way for nonprofits to generate income, support their programs and fulfill their mission.