Working Paper 11: Abstract

Balancing Margin and Mission: Nonprofit Competition in Charitable versus Fee-Based Programs

Competition in the nonprofit world has intensified in recent years, and nonprofit managers are challenged to devise strategies that will serve both organizational needs and public interest.  We propose a framework for thinking about nonprofit competition based on the intersection of two dimensions:  the domain of competition, which can be either fee-based or donative activities; and the competitive strategy, which can be either price- or differentiation-based.  The experience of the American Red Cross, a prominent nonprofit organization facing competition in both fee-based and donative domains, provides data for the elaboration of the framework, and for tentative conclusions about the implications of nonprofit competition for both margin and mission.