This is Part 1 of a two-part series about how to offer fundraising opportunities in your gym. Part 2 will be released on March 27.

 

With a new season about to begin, you may have had to increase your prices to meet the increased cost of competitions, staff salaries or even just to meet the expectations of your parents. Just recently our competitive tumbling parents provided some valuable feedback for us. They wanted team practice wear and more team bonding events. As I built the budget for the program, I realized that not only did their fees need to increase to meet the demands of inflation and rising staff costs, but in order to cover the season fees, some parents would need to fundraise. 

 

Ten years ago, I never would have said this. I firmly believed it was important to put a sport in your budget your family could afford, and that constant fundraising would burn families out. While I still believe in the burnout factor, I do believe there are families out there who rely on fundraising as the result of the rising cost or their family dynamics. Over the years, some of our families have had three or more kids in all star at the same time. Other families with one parent working and the other staying at home with small children have expressed the desire to add siblings to our program but didn’t truly have the availability for a job, so they relied on fundraising.

 

But this is where a lot of gyms get caught up. How do you truly allow fundraising without being a non-profit or having a booster club? Below, I’ve offered some options used by gyms in the Next Gen Academy. Some require more calculated operations and committed volunteers while others require the manpower of a gym staff member. Choosing what’s best for you may be limited by these, but ensuring you’re always fundraising while operating legally is a must!

 

Option 1: Sell sponsorships to “fundraise” as a for-profit entity. If you watched our Fireside Chat a few weeks ago about non-profits vs. for-profit businesses, you know this can actually be a huge advantage to local businesses. If you missed it, see the link at the bottom of this post! In fact, it’s even more advantageous for most businesses to purchase a sponsorship that markets their business for them than simply donating. This can be done as a for-profit gym. Here’s how it works. Perhaps you’re going to make t-shirts or hang banners in your gym. We’ve done both of these. Your athletes would canvas local businesses selling sponsorships for these. Ideally, you would have certain price points that equal the size or prominence of the ad itself. Perhaps a $100 sponsorship gets the business’ name on the back while a $500 sponsorship gets their logo on the back. Either way, the business specifically pays the business. As a business, you can choose to pass a percentage, or all of the fees onto the participating team or athletes. 

 

Pros: The standard tax deduction for an individual’s charitable donations for 2024 is $14,600. For married couples filing jointly, it’s $29,200. So, if you own the business yourself, you must donate $14,601 between business and personal donations in a year to itemize your deductions. If not, you may as well donate nothing, because you’re getting $14,600 as the standard. If you own a business jointly, you must donate $29,201. Ouch. I feel like we’ve been incredibly generous in donations over the years, but I’ve never donated $30,000 in a year. However, marketing IS tax deductible. So, while donating gives us a warm, fuzzy feeling, marketing is usually a better deal for businesses looking to help out a local group of athletes.

 

Additionally, there are some great businesses that may be very interested in marketing through banners in your gym – especially if those banners are present in an open lobby where parents are sitting for hours at a time. Examples of businesses that could really benefit include pediatricians, orthodontists, tutoring businesses, ice cream or frozen yogurt parlors, woman-targetted gyms like Curves or Blush Bootcamp, woman-focused boutiques, children’s resale stores, car dealerships, health food stores, and realtors. If you’re tech-savvy, you can even create a pop-up for anyone who logs onto your WiFi featuring the sponsor for that month! Talk about a deal on marketing!

 

Cons: You’ll need to consider how these sponsorships are paid. For example, you can provide a link to the gym’s Venmo or invoice the businesses. Both are legal as long as they’re accounted for in your income. But if someone pays you $500 for a sponsorship via credit, you’re likely going to lose 3-4% in processing fees. That equates to $15-20. Multiple that by ten sponsors, and now the team has made good money, but the gym has lost money. Additionally, if your staff is helping escort athletes to the businesses, sending emails, answering questions, designing or ordering the t-shirts, then you, as the owner, are paying someone to raise money for athletes. An administrative fee and a processing fee will need to come out of any sponsorship funds before it is applied to any athletes’ accounts. Additionally, unless you travel as a team, it can be hard for parents to use this money for travel. Years ago, I had a parent who had about $300 in credits at the gym from fundraising like this. She ended up having to pull her daughter out of cheer because they couldn’t afford the gas and hotel for an upcoming competition. We do not pay for parents’ gas or hotels as a team, so I could not reasonably give her that money. I was able to apply it to anything in the gym, so she could pay her tuition with it, and then use her tuition dollars to pay for travel, but by nature, people are not great with money…so that’s not how it worked out.

 

Additionally, one of the disadvantages here is that you’ll miss out on fundraising at some of those special events like NFL games or 501(c)3 required events. Tomorrow I’ll tell you how the booster club in my gym operates and my level of involvement in it.

 

Stay tuned for Part 2 of Fundraising 101, and make sure you watch our Fireside Chat episode where we talked about whether your gym should be a non-profit organization or for-profit business. 

 

Watch Fireside Chat in the All Star Coaches’ Group.

Watch Fireside Chat in the Owners’ Group.