VOL. 123 | NO. 253 | Monday, December 29, 2008
Giving in Tough Times Balancing Act for Companies
By DAN SEWELL | AP Business Writer
CINCINNATI (AP) - She sat patiently in her wheelchair, as scurrying volunteers gathered ham, a turkey, canned goods, bread, and bags of potatoes, apples and pungent onions in a storeroom with sporadic drafts of frigid air from outside.
But Patricia Jordan had a warm feeling as she considered the bounty that would help feed her cash-strapped household of 14, including her disabled-veteran husband, their children and her sister's family. She, like others who flocked to the FreestoreFoodbank this week, were concerned about companies reducing donations this year because of the economy.
"I think a lot of us were worried about everybody cutting back, but so far it's panning out," Jordan said. "You can't ask for any more than that, that they're still willing to help."
The food bank opened 90 minutes early Monday, at 6:30 a.m., after workers found 200 people lined up, some waiting in below freezing temperatures since 4 a.m.
Across the United States, the needs are growing as the recession deepens and leads to more families struggling each day just to put food on the table. Feeding America, the largest domestic hunger-relief organization, says some 25 million people are going to such food banks, and the number is rising. And at the same time, many usual donors are facing their own budget problems.
FreestoreFoodbank expects to serve 16,000 households here this holiday season, and says demand has jumped 55 percent in the past two years, as jobless numbers rise and household budgets get stretched. But companies such as grocers Cincinnati-based Kroger Co. and Minneapolis-based SuperValu Inc.; Northfield, Illinois-based food maker Kraft Foods Inc.; and St. Louis-based bakery-restaurant chain Panera Bread Co., among others, have helped keep filling bags here.
"They get it," said John Young, the food bank's chief executive. "They understand that we're serving many more people this year. It's touching their customers, their communities."
Not all businesses are reacting in the same way, though. The New York-based Committee Encouraging Corporate Philanthropy found that about a third of companies surveyed cut 2007 charitable giving in the slowing economy, and there are indications of more reductions this year. Sectors that showed declining giving in 2007 were financial, health care and utilities.
"It's a conflict, no question. How do you keep giving when you have laid off employees and are making other cost cuts?" said Charles Moore, the committee's executive director. But he stresses to corporate leaders the customer loyalty and connection to community they can build through giving – benefiting business in the long run.
"You can be sure the community won't forget that the company stepped up," Moore said. "There is business to be gained at all levels by companies digging deeper in difficult times."
Companies have been hit by slower sales, volatile energy prices and higher raw materials costs, and some charitable organizations acknowledge that business leaders are under pressure to make profits, not give away money. Some ailing companies such as Ford Motor Co., which donates refrigerated vehicles to help get food donations to rural areas, have continued charitable programs, but at reduced totals.
Wal-Mart Stores Inc., the Bentonville, Arkansas-based retail giant that has seen sales continue to grow in a discount-minded economy, has increased its giving of cash and food this year.
"We've made an extra effort to stand shoulder-to-shoulder with our community partners and our customers who maybe need some extra help," Wal-Mart spokeswoman Deisha Galberth said. She said the company, which donated nearly $300 million to charity last year, will top that this year. Wal-Mart last week gave $400,000 in hard-hit Ohio alone, to help feed families and pay utility bills this winter.
Ross Fraser, spokesman for Feeding America, said companies have been creative in keeping up donations such as by diverting holiday gifts and year-end bonuses to charities. Kroger encourages customers to "round up" their bills at checkout to donate, and grocers are coming up with more in gleaning efforts, in which food that would be pulled off retail shelves because it's at sell-by dates or for other reasons is donated because it's still good to eat.
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