A Bike-athon Looks at the ‘True Cost’ of Raising Money
By Drew Lindsay
Senior Editor, Special Projects
February 29, 2016 | Read Time: 1 minute
Pelotonia, a bike-athon in Columbus, Ohio, that raised $24 million for cancer research last year, aims to increase merchandise sales to raise both awareness and revenue. But before this push, it set out to gain a better sense of its return on investment.
Starting point
The organization, which previously sold chiefly T-shirts and race jerseys, knew little about the items’ true costs. It bought the T-shirts for about $6 each, for example, but had never analyzed the costs of staff time involved in designing logos, and for packaging and shipping.
Key move
Pelotonia President Doug Ulman hired Chris Williams, a retired 37-year veteran of the retail industry, as a consultant. “My background is all about return on investment and what margin we’re making,” she says. “That’s the way I’m wired to think.”
New gear …
The organization is expanding its merchandise line to include sweatshirts, hats, and other items that can be worn year-round, not just at the August race. For each piece of merchandise, Ms. Williams and staff are identifying all costs of the product, not just what Pelotonia pays for the raw material.
… And a new approach
Pelotonia is also seeking underwriting to cover individual steps of the process; one company, for instance, is selling the organization a garment at a discount and handling the graphic design. “That’ll give us more return in the long run,” she says.
High expectations
The expanded merchandise line debuts in March. “We see this as such a growth area that it should pay for itself and more,” Mr. Ulman says.
