Charity Begins At Home
Whenever celebrity DJ Carl Williams is asked to perform for a fundraiser or non-profit, he only asks one thing in return: That he receives the rights to all branding and exposure.
“If the event is advertised in print or online, then they have to display my logo,” explains the New York City-based jock. “If the event will be on TV, then I request that they show my image at the event.”
Williams says he receives many requests to do charity events—he recently flew into Orlando for the Camp Boggy Creek fundraiser and fashion show, the second consecutive year he was asked to be the executive music producer and MC—but sometimes he simply has to turn them down.
“Doing four charity events per year is my quota,” he says. “However, if a special corporation or individual wants to sponsor me to perform then I’ll definitely exceed that quota.”
We asked mobile DJs from throughout the country how they respond when a potential client or non-profit asks them to do a no-cost gig. How do they gauge whether the freebie will benefit their business? Are there particular tax benefits? Or is donating occasional jobs just their way of “paying it forward”?
Up in South Portland, Maine, Mark Mahoney of M&M Entertainment says his company does a lot of charity work, so they’ve developed a set of guidelines to help determine how it works.
The first rule is to make every attempt to at least get paid a little something. “I always charge for them, and I push to be worth every penny,” Mahoney says. “If it’s a devastating personal situation, I may very well donate my payment back to them, but those are extremely rare—and I don’t let them know ahead of time that I’ll be donating back.
“This is much different than doing something for free, as I don’t want to set an expectation. I’ll say something to the effect of, ‘I’ll be happy to donate my time; however, I need to charge for use of the equipment.’ This is a significantly reduced rate, but it does in fact cover my costs.”
Mahoney says that a donated DJ is often a lose-lose proposition. “A donated DJ will generally play music and do nothing more—not because they don’t want to, but because they don’t know how,” he explains. “I do get paid for the charitable events I do, and my reasons for doing so are threefold:
“First of all, while I may be fully committed to the cause at hand, I may not be able to be there in person for the event due to any number of unf oreseen issues, including illness and Acts of God. As a professional, I’m obligated to make sure that, despite any failing of my own, an event will still be a success. So, should someone need to fill my shoes, I’m no longer just donating time, but actual money to use all the equipment it takes to make an event a success.
“Secondly, a good DJ will make a fundraiser-client more money—that’s what we do. We work with our clients to design activities to raise money. We help market an event so that it gets maximum exposure, advise on things such as cover charges, photo opportunities, selling swag to make you more money, and drawing attention to your cause by getting mascots and other sponsors to get involved.”
Mahoney says that, while a successful event with a donated DJ might net a group $1,000, the same event with a seasoned charitable event professional should net an organization more than three times that amount.
“Thirdly, I give the potential client a price range based on the scope of what they’re asking me to do. Depending on the size and scope and date, they’ll likely be looking at somewhere in the $150-300 range.”
Of course, Mahoney says there’s always an exception. “I do have one event I donate to every year that pays me $1,000,” he says, “but that’s a three-day event on a weekend smack in the heart of wedding season. So, as I see it we’re both getting a deal.”
Down in Birmingham, Ala., Geoff Carlisle of JAMM Entertainment Services says his company is asked by numerous non-profits for donations for their events, whether it’s an item to auction off or an entertainment element for an event they’re hosting.
“We pick one non-profit that we donate services for each year,” he says. “This donation is done for just the idea of ‘paying back’ for all of the success that we’ve had for the year.”
Carlisle says if there’s an opportunity for another non-profit or organization that he can donate to or for which he can provide a discount, he might create a special package.
“For example, a local PTA wanted us to donate a DJ package for their auction,” he explains. “We agreed that we’d do it if we could also bring our photo-booth, which allows us to instantly upload the photos to our Facebook page. Allowing everyone to tag themselves on our Facebook page—along with the instant printouts with our logo—made that a win-win for us.
“But we also made a deal that we get all of their school events for the next year if we donated to the auction, so that actually turned into a win-win-win.”
Carlisle says that every non-profit/organization and their events is different, so it’s important to evaluate the exposure, the type of crowd, the marketing opportunity and the cost of the service his company will provide.
“Also, sometimes the groups will pay you to provide certain items that they need,” he says. “They may need décor lighting, a PA system, etc. They’ve rented from other vendors, but it’s up to you to ask what all is needed at their event. The person who’s in charge of the entertainment may not know the needs of the other chairpersons, so dig a little and you can discover the perfect scenario.”
Carlisle is quick to agree that a simple tax write-off isn’t what some people think. “I’ve been told,” he says, “that you can only write off the actual hard cost—labor, product usage, etc.—and not your normal retail value of the element.”
Jerry Bazata of Jaz Music & Entertainment in Ogunquit, Maine, says it’s important to balance the feel-good aspect of giving with the actual cost of donating the services of your business.
“Consider these pros and cons of donating your time and talent,” Bazata explains. “You have hard costs associated with performing at the event, which can include travel, business insurance, wear-and-tear on your equipment and laundry. This may be $100–$200 out-of-pocket expenses.
“For tax purposes you can only deduct the actual mileage to and from the event, overnight accommodations and meals. You’re not permitted to deduct what you normally would charge for a general event as a fee.”
Bazata says it’s important to consider the potential lost revenue because we committed to a freebie and passed on other events for which we would have been paid.
“DJs sometimes commit months in advance to a gratuitous event during prime season, such as a Saturday in June, only to find they had to turn away weddings or proms,” he explains. “Donating your DJ services will not automatically generate referral revenue for you. Many of us have the false perception that people attending the event will book us for future events because our time was donated. But veteran mobile DJs will tell you that less than 1-percent of non-profit function attendees will book a DJ service because they were a good citizen and donated their time.
“The greatest risk factor is that you could have been paid for the event, but were too quick to donate your time.”
Bazata explains that over the past six years he’s assisted a local nonprofit organization with an event that annually raised thousands of dollars. The first year he donated his services, but as the event (and the demands on his own time) grew, he was able to negotiate a fee for his services, which compensated for his travel expenses, six to eight hours of meeting time, wear-and-tear on his equipment, etc.
“But this past year, a young and energetic DJ who was new to the market offered his services ‘gratis’ to a new member on the planning committee,” he says. “After much debate, those long-standing committee members who trusted in me were out-voted and the organization went with the new DJ.
“The DJ may or may not have known that the organization had paid for service in the past; however, what he left on the table was $2,000 for his services.
“The lesson? Don’t be too quick to donate 100-percent of your services. A little investigation about a client’s budget just might put some dollars in your pocket for the hard costs you incur.”
Bazata has lots of advice for DJs considering a donation to a non-profit event, and he says the most important thing is to plan ahead. “Be willing to negotiate a fee for your time outside of the event, and set a minimum fee for nonprofits to cover the hard costs you incur,” he says. “If you offer during a prospect meeting to donate back part of your fee, I guarantee you 90-percent of the time they’ll book with you.
“Ask up-front if the organization has a budget for your services—99-percent of the time they do and are willing to pay. It may take some negotiation, but in the end both you and the client will benefit from the negotiation.”