A simple change that saved a charity £20,000

Isn’t ‘FREE’ great? We all love a bit of ‘FREE’ stuff don’t we?

But is there such a thing as ‘free labour’?

After many many months of badgering we managed to make an appointment to go and talk to a charity about their mailshots. We knew that they were sending out a fair bit of stuff, so we thought that maybe we might be able to help them save a few quid, as we do.

What we found when we got to the office was quite remarkable. Rows of tables with lots of eager people stuffing letters, leaflets and magazines in to envelopes. Another set of eager people sticking on address labels, and finally a rather exasperated lady standing at a franking machine, franking envelopes one after another after another….

On first glance it all looked very efficient, they were all working very hard and actually looked reasonably happy in their work (except maybe the franking machine lady who looked a bit stressed). Tea and biscuits were aplenty. Happy days.

And so, in to the meeting with the membership manager. “You won’t be able to save me any money” he said, “that lot out their don’t cost us a penny, they are volunteers, you won’t beat free!” he said with a wry smile.

Fair point. Free is pretty difficult to beat. How could we as a commercial enterprise with all of our overheads and wage costs possibly compete with free?

So we did them an analysis of what their costs actually were, excluding the free labour. The envelopes, the labels, the postage.

And then we told them what we could do the job for, supplying the envelopes, addressing the envelopes, stuffing the envelopes and the postage, taking into account how many they would typically do over the course of a 12 month period. And we were £20,000.00 cheaper.

How? Our envelopes were a bit cheaper, we don’t use labels much, we inkjet names and addresses directly on to the envelopes (looks better than wonky labels). We use our machines to stuff the contents into the envelopes. And finally, the really big saving – the postage. By using our software to pre-process the data we saved them a whopping 50% on their postage bill. And that was compared to a franking machine, if it had been stamps the savings would have been even greater than that.

Oh, and what about the “free labour”?  What could they possibly do if they weren’t stuffing thousands of envelopes? Well, they could spend their time on far more meaningful activities designed to raise awareness of the charity and drag in more desperately needed donations, instead of sitting for hours on end stuffing envelopes.

You could almost argue that the ‘free labour’ stuffing envelopes was actually costing the charity money in lost potential donations.

Free? Hmmm… maybe not such a good thing all the time.