how do you make money if it’s a non-profit organization?
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Generally by taking a salary. The company itself can’t make profit to distribute to share holders like a normal corporation does but nothing is stopping them from paying thier staff well like any other company does.
This may be different in other country jurisdictions, but usually, the “non-profit” part of the title just has to do with what the organization does with its revenue. The organization can sell products or services to raise money. It can pay employees a salary or wages.
It’s just that whatever money is left over at the end — the profit — can’t be distributed to owners or shareholders as would happen in a company. It has to be retained by the organization and reinvested into furthering the goals of the organization.
A non-profit organization doesn’t mean that money doesn’t come in, and that employees aren’t paid. It means that the organization is not allowed to pay out any excess money they have to the ownership or give arbitrary unstructured bonuses to employees.
Non profits have budgets and the employees of the non profit get salaries. You then raise money to fulfill that budget. But you don’t have an excess of money raised that’s then given to any of the employees of the non profit above and beyond their already established salary.
Non-profit just means there are no dividends to shareholders and the business must spend all the money they make on furthering their mission.
This includes paying their employees.
Their mission is the reason this company was created and unlike for-profit company the answer isn’t to turn profit for its founders.
How is having shareholders then better? It would seem to me that being able to pocket all the profit yourself is better?
I am a non-profit employee. Everyone in our company takes a salary. When we get close to the end of the year, the company figures out the amount that would be “profit” – basically, income minus expenses – and pays that out to employees as a bonus. Zero profit, happy employees, company keeps going.
Not for profit is a misnomer – you can make a profit (revenue – cost) in not for profits. Their goal is usually to benefit a specific cause and be close to breakeven.
I work for a state funded program for blind and handicap but we sell solar and mining hooks to hold wires, has been in business for year’s because it gives mentally disabled individuals a place to work and have a normal life since most places wouldn’t hire.
We have a certain amount of individuals that the state gives which makes us non-profit. Granted they can pay regular employees and get bonuses and all that but it’s mainly for the individuals and we make money along with that as I started above our products. The extra we make is put back into the company to grow, we can have some saved to my knowledge but only a certain amount each year.
Hell last year we got to go to idle wild like 500 people that company paid for including us regulars was great!. This year it’s a Zoo trip.
You beg others for money, or you send some people out to beg others for money, also you can ask business for money so they can do tax write off.
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