How is it that non-profit adoption agencies make profit?

Question

and if they do make profits then why are they caled "non-profit"

Answer 1

They are able to claim the title "non-profit" for one reason:  because there are no shareholders that make capital gains and receive dividends as in a for-profit corporation.  Instead, non-profit corporations (which these are) distribute their money to staff and directors in the form of salaries, wage bonuses, etc.  

Non-profit can still mean that the people involved can make a very large income from it.  Anyone can establish a nonprofit corporation, and if you can find an income source to bring in a large cash flow greater than your expenses, then you can pay yourself a large income and the corporation is still technically "non-profit."  Just because it comes in the form of a salary and not dividends makes little difference.

Agencies actually have very little in the way of actual expenses other than rent, wages, office space, etc.).   The hours spent on each actual adoption is minimal.  Plus they know that the more hours of "birthparent counseling" they provide, the more likely a mother will surrender her baby (a study by Cocozelli in 1989), so this is no big expense for them: instead it is an "investment."

Compare the difference:   $10,000 and up for a newborn white baby.  $200 in court costs to adopt back my son. The profit they make also goes into marketting to find more expectant moms and convince them that adoption is "the loving option".   Unfortunate, that's how the industry works.  

Answer 2

yeah they make most of there money through donations just like the ASPCA. But they usually charge people adopt adoption fees to help cover things like transportation, and paperwork and anything they are required to do by the government that have to do before passing them on to their forever home.

Answer 3

99% of all non-profits make a profit, that profit simply goes into the pockets of the ceo's, directors, etc..

They are generally called non-profit b/c they are religiously affiliated and are permitted to label themselves as such.

It means that the company was not established for the purpose of making a profit....NOT that they won't make a profit or that it can't be a secondary goal...just that profits aren't the reason the business was started. So, technically, anyone can call themselves non-profit. They get special tax codes and often get governmental aid for being a non-profit....so they are really reaping all of the benefits for being 'non-profit'.

Answer 4

Non profit does not mean that they work at a loss or that they must budget so that they make exactly what they spend.  Prudent business practices dictate that businesses, even non profits, make enough money to operate and that includes having enough reserves in the bank to provide for normal business expenses (rent, rent increases, employee salary, cost of living raises, insurance...) expansion plans and equipment replacement plans (new computers, office equipment...).  What they are not allowed to do is bank money to pay out stock holders who expect a return on their money or things like that.

My wife volunteers for a non profit pet rescue that currently has almost $200k in the bank ...but they are taking steps to build a dedicated building for their operation and not paying out share holders.  Since it's not considered profit because its being used for business plans and expansion they still have their non profit status and their charity number intact.  I'd suspect that even non profit adoption agencies work that way.  It's just prudent business planning.

Answer 5

All non-profit means is that you don't have to show a profit.

Answer 6

i was going to start one,an honest one to help pay for the expenses involved in real seashore clean-ups that i have been doing for the past 27 years but to become one here in ny one has to sponcer another,99% are friggin' crooks.so i put that off on the back burner so to speak.i do know a few board members from Healthy-Planet but our morals clash.

Answer 7

They make ridiculous salaries.  It's pretty d**n profitable when you're making 500K a year distributing children from poor women to rich women in exchange for money.  They can be called "non-profit" because in order to becalled "non-profit", you just have to not SHOW a profit.  If "expenses" don't match up with how much money is coming in, everyone gets raises!  Viola, instant non-profit.

Answer 8

It's very clever, isn't it?  People buy into the myth that these businesses making huge amounts of money and investments are actually charitable organizations.  They are far from that.

The links from the answerer above me make for very interesting reading.

Answer 9

Oh my goodness - Look I understand that you're apparently very upset about something but it's important to look at things rationally.

Non profits do NOT make a profit. I don't know why you think they do. Actually I'm afraid that you think they make a profit either because they charge fees or because they have operating budgets and revenue.

Non-profits do not amass profits. They have operating budgets, cover employee pay and generate funds to expand their programs. There is nothing in this world that can be done without capital. That is why the most successful charities in the world are constantly generating funds. If non profits do not generate significant funds they either operate perpetually in a very small arena or become defunct.

It is also possible that you may be confusing non profit agencies with bona fide businesses. Some agencies do strive to turn a profit. It is quite difficult in the current environment but there absolutely are companies that operate in the adoption business. They provide a service and charge a fee for that service and there is simply nothing wrong with that.

Answer 10

donation!

Answer 11

A great way to look at the profits that "non profits" make is through their 990 forms that are public online. Commonwealth Adoptions that is filing for bankruptcy paid their employees handsomely into the 6 digits, and they grossed over 8 million last year.

They only spent a couple million. Suddenly the money is gone, and theyre filing for bankruptcy,...interesting. Also interesting that they sent their employees to work for Gladney, and that theyre left over paps are now going to Gladney too. I wonder how much they were paid to go out of business by Gladney??? Of course, i cant prove that YET.

990 forms are free online:

http://dynamodata.fdncenter.org/990s/990...