Charities, associations limited by guarantee and unincorporated associations can all, if done correctly, benefit from entering into partnership with commercial partners. Commercial partnership will be when a charity/association enters into a partnership agreement with a commercial company with the goal of either raising money for the charity/association or to raise its awareness. It will typically often allow the company to use to use names or logos, for the company to associate with the charity/association and in return the charity/association will receive a proportion of the income or some other benefit which related to the promotion. 

For organisation related to sport commercial partners will often appear in the shape of sponsorship agreements, where commercial companies pay for the right to associated with some valuable assets own by the charity/association such as national teams or events etc. Working with commercial partners can, especially in charities but also in limited companies and unincorporated association leave ethical questions to be dealt with, and it is recommendable that organisations consider establishing an ethical policy which should be incorporated into the organisations wider fundraising strategy. The ethical policy will have to include types of companies which the organisation don’t wish to work with and should be linked to an organisations values (see Strategic Plan) but also Marketing (see Marketing) as some partners might create bad publicity and damage the brand of the organisation and its future ability to generate commercial income.  

Entering into a commercial partnership, charities/associations will have to make sure that a suitable contractual environment is present and to make sure that its commercial interests is protected. An written signed contract is, therefore, of major importance with important items included such as:

• Date of contract.
• Names of parties involved.
• Details on what will be received and what should be provided.
• Details on payment: how much and when.
• Important deadlines: e.g. when certain services should be provided.
• Expiration dates.
• Renewal terms, if applicable.
• Damages for breach of contract,
• Termination conditions.

Downloads:

Maximising income generation.pdf

A guide inteded for non-profit organisations who wish to raise commercial income.