Many times the question is posed to me whether A Labor of Love Adoptions is "non-profit" or "for profit". There is more to the answer than you might think. I have served on non-profit boards, as well as for-profit boards. The term "not-for-profit" is defined as "a legally constituted organization whose objective is to support or engage in activities of public or private interest without any commercial or monetary profit". That means, at the end of the day (or year) there is no extra money to disburse to owners or shareholders. Most "non-profit" organizations do indeed make a profit, so what makes them different than a "for-profit" organization? When an organization designates themselves "non-profit", they generally have a 501(c)3 status. This enables them to solicit funds from donors, have fund-raising events, and accept cash donations. They are governed by a board of directors and decisions affecting the organization must be decided by the board. So, if someone is hired or fired, the board must approve. If an event is planned, the board must approve. As far as profits go, many non-profits make more in the way of true profits than non-profits. The difference is, whatever profit is actually realized must be put back into the organization (thus, there is no profit). This can be done a number of ways. State of the art computer systems and phone systems can be purchased. Office renovations and upgrades can be done. Real estate can be purchased. Staff and officers can take the added funds in bonuses or pay raises. 401Ks for staff members can be set up.
For some reason, when people hear the word "for profit", they automatically think that those who work in a for profit situation are greedy or "aren't in it for the right reasons". This couldn't be further from the truth. In actuality, our "for profit" facilitating service costs adoptive families much less than a full service non-profit agency adoption. Part of that is because simply by being an agency, the costs go up (added insurance costs and requirements by the state which are passed on to the adoptive parents). The other part is that when running a "for profit", the owner or owners make the decisions. Day to day operations aren't governed by a board, but rather someone who is in charge. If that person is experienced and doing a good job, the costs can be kept down.
For the entire first year that my company was in business, I didn't take a salary from my "for profit" corporation. I put as much as I could back into the business, doing extra advertising. That couldn't continue forever, but in our case, we spend operating funds on items such as office rent, phones, salaries for staff, and other office overhead. After that, everything goes into advertising. Our clients get the most for their advertising dollars.
The two most expensive adoption operations that I am aware of are both "not-for-profit". I won't name names here, but you can find them fairly easily if you start looking into adoption. They charge 35-40K per adoption, almost triple what our families end up paying for their adoptions. In one instance, the agency requires birth mothers to get on medicaid (this is traditional), but then charges each family for a "medical pay", which is almost never needed. Where does that extra money then go? Into their "non-profit" pockets. Of course, not all non-profit organizations do this. I know plenty who are doing what they do for the right reasons and are very diligent about where they spend their money. Just be aware that the designation "non-profit" or "for profit" shouldn't be interpreted to mean exactly what it sounds like.
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