How Nonprofits Generate Income

Mar 23, 2023 By Kelly Walker

The Christmas season (and the year-end tax deadline for charitable contributions deductions) makes December the busiest month for charitable giving, which is crucial for the survival of nonprofits that focus on helping others. Hence, during the other 11 months of the year, nonprofits must grow resourceful to survive.

Charities and nonprofits may collect money and make their efforts go further in five primary ways: through the help of volunteers, large-scale fundraising events, the sale of products, the provision of event sponsorships, and the deployment of advertising.


Charities get monetary contributions, but the time of their generous donors is often more valuable to them. The American people also are entirely giving up their time. According to AmeriCorps's latest Volunteering in America report, 30 percent of U.S. residents offered their time in 2019, contributing 5.8 billion hours.

This sum is approximately $200 billion as of April 2022, according to statistics from AmeriCorps and the most current Current Employment Statistics from the Bureau of Labor Statistics, with the value of a volunteer hour equaling $29.95. Nonprofits can find groups dedicated to helping other charities get the most out of their volunteer forces.5

Formal Occasions

Galas are held annually by several organizations to generate money for their causes. Although the initial investment may be high, the financial windfall might be substantial. The off-Broadway York Theatre Company's Oscar Hammerstein Award Gala, held annually since 1988, is only one such event.

Dinner, speeches, award ceremonies, and entertainment are all part of the plan. A charity can raise significant funds from a gala by selling expensive tickets and receiving corporate sponsorship. Donations of food and alcohol are common from local stores. Donations of services and goods from local companies can be auctioned off in silent and live auctions to raise even more money.

Marketable Goods

Several organizations raise funds via the sale of merchandise associated with their mission. Consider the popularity of Girl Scout cookies and Boy Scout popcorn each year.

Since a Girl Scout unit in Muskogee, Oklahoma, started selling cookies to earn money in 1917, the organization has made millions. In 1922, the notion spread throughout the country.

Eighth, the annual Girl Scout cookie sales revenue is nearly $800 million. The Girl Scouts, according to the World Economic Forum, earn more money from cookies than the makers of Oreo.

10 Membership fees are easily outpaced by cookie sales, with an estimated 2.5 million girl and adult members worldwide and a yearly membership price of only $25. The West Side News & Greece News, which serves the suburbs of Rochester, New York, said in 2020 that 9,000 boys in five counties sold an average of $1.2 million worth of popcorn annually.

More than $600,000 in cash and prizes is raised yearly through the sale, held in 16 counties in South Central Wisconsin and Northern Illinois by the Boy Scouts of America Glacier's Edge Council.

Shows and Events

Although charitable organizations rely heavily on the support of the rich, gala events also need to draw a sizable crowd. Not-for-profit arts organizations have the upper hand in this respect and can stage plays, ballets, and recitals.

Those who aren't artistic shouldn't give up hope, either. lists car washes, silent auctions, cook-offs, shoe drives, and walks as some of the most popular ways to raise money for a good cause.


Sometimes, even nonprofits need to spend money to bring in donations. The reach and awareness of a charity among potential contributions may be increased through advertising and marketing. Advertising, like volunteering, doesn't bring in money but can result in donations; a high-profile supporter can significantly amplify the effectiveness of a drive to raise money.

To What Extent Do People Give of Their Time to Nonprofits?

AmeriCorps reports that in 2019, 30% of Americans volunteered 5.8 billion hours to various causes. AmeriCorps increased the value of a volunteer hour to $29.95 and the total sum to approximately $200 billion in 2022.


Charities are among the most effective of the numerous types of organizations that exist only to collect donations. There is a wide variety of revenue-generation opportunities for nonprofits, including product sales and fundraising activities.

Donations seldom pay operational costs and the job a charity exists to perform. Thus many charities and nonprofits need to generate enough cash to maintain longevity.

That's why it's common to hear nonprofits talk about how they "make money" or "generate income"; charities need to think and act like businesses to stay in business.

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