Introducing Amazon Business Solutions for Nonprofits

There has been a lot of talk about the impact of the pandemic on businesses and consumers. However, the pandemic’s impact on the nonprofit sector has not gotten sufficient coverage. Due to cancellation of in-person events and lack of access to donors, fundraising is the chief concern. In a survey conducted by the Nonprofit Finance Fund, 60 percent of the nonprofits interviewed indicated that they are experiencing conditions that risk their long-term sustainability, and 64 percent expect this trend to continue in the months ahead.[1]

Even before the pandemic hit, nonprofits followed a predominantly manual procurement process, with globally only 23 percent of nonprofits reporting that they have long-term vision for technology modernization.[2] In a survey of four hundred nonprofit organizations conducted by the consulting firm Levvel, 26 percent of respondents used procurement automation as compared to 34 percent for all other industries.[3] The pandemic has provided an opportunity for nonprofits to rethink digital adoption, including use of online procurement tools. They recognize this opportunity to make changes that will pay long-term dividends in terms of cost and time savings.

To help nonprofits make this transition to digital procurement, we are announcing the launch of Amazon Business Solutions for Nonprofits—a one-stop shop for your purchasing needs with tools that simplify purchasing at your organization.

In our conversations with nonprofit customers, we learned that they seek time-saving tools, cost-saving measures, compliance, and transparency. We will describe below how our Solutions address these needs.

Time Savings

Amazon Business facilitates purchasing from hundreds of thousands of selling partners in one place and eliminates the need to expend time finding and negotiating with multiple suppliers. Your staff can order the items they need online the same way they would shop on their personal Amazon account. If your organization uses a purchasing system, Amazon Business integrates with that system so your staff and volunteers can obtain easy and secure access to Amazon Business. You can even create a list of items your staff purchases frequently, so they do not need to repeatedly spend time discovering and purchasing the same items. Your staff can easily reorder items from this list in any quantity and share these lists with other staff members and volunteers, thus saving them time as well. In addition, your organization can maintain control of spending by setting up online purchasing workflows that kick-in if an order doesn’t adhere to your policies. This ability to define guidelines that reflect your organization’s principles and set up seamless approval workflows saves time for staff and volunteers, as they don’t need to deal with paper approvals. No more waiting for weeks to receive approvals and get your staff the items that they need.   

Your organization can also choose to become a Business Prime member, which will enable staff to obtain unlimited free two-day shipping on hundreds of millions of items, as well as one-day shipping on millions more. In addition, some nonprofits are also eligible for tax exemption on their purchases. By enrolling in Amazon’s Tax Exemption Program (ATEP), your organization can make tax-free purchases on eligible orders. This enrollment also eliminates the need for your staff to call customer service centers to obtain post-purchase waivers.

Overall, the less time your staff spends on purchasing means the more time they can spend on your mission, thus reducing your administrative overhead.

“Things like approving invoices and reconciling receipts for expenses used to take five to seven days, and now it takes two. What used to be a manual process that took up much of our time is now almost entirely automated. This reduces processing times and allows us to provide autonomy to center directors to get what they need more quickly and efficiently.” —Rick Quaintance, Senior Director of Procurement and Contracts Management, USO

Cost Savings

Consolidation of purchases on Amazon Business can help you save money in the long run. Your organization can save more with Quantity Discounts: these discounts apply when, during a single purchase, your staff buys at least two of the same goods from a selection of over 60 million items. In addition, eligible nonprofits can obtain Business Prime memberships at up to 65 percent discount. Cash flow is also an important consideration for nonprofits. Amazon Business offers Pay by Invoice, which enables your organization to buy now and pay later at no interest on 30-day payment terms. Your organization may even be eligible for extended payment terms of 45 or 60 days, if you are a Business Prime member.  Less money spent on purchases and increased ability to manage your cash flow means putting your donors’ money to better use by investing in your critical initiatives.

Policy Compliance

We recognize that every dollar represents a choice between funding critical staff, operations, and programs versus administrative overhead. With staff and volunteers wearing multiple hats (including purchasing), it is important that nonprofit organizations like yours have mechanisms in place to track and monitor spending. With Amazon Business’s Buying Policies and Approvals, your organization’s Amazon Business account administrators can define different types of buying policies. For example, administrators can identify preferred products or sellers (for example, sellers that participate in ATEP or accredited local, small, or diverse sellers to benefit the community). Administrators can also block restricted sellers or categories and define spending limits. Furthermore, they can identify approvers for any of the policies, so volunteers and staff can easily understand who to seek appropriate approvals from, when required. This process is all done online and has a clear audit trail, thus offering you the visibility and control you need to ensure that donors’ money is spent judiciously. This feature also offers you the flexibility to fully decentralize purchasing decisions and know that the process is in place to mitigate unintended spending. In that spirit, Amazon Business’s Budget Management tool helps decentralize purchasing decisions and offers staff the freedom to purchase what they need by allocating a time-bound preapproved budget that they cannot exceed.    

“What we’ve done is allow each center director to manage their own regional budgets, and all purchases go to the center director to review and approve. So for example we have ten centers in Southwest Asia, and have identified ten approvers, creating a self-service model for our centers.” —Tina Stockov, Procurement Manager, USO

Transparency

Tied closely to compliance is the fact that donors seek transparency and accountability for the money that is spent by the organization. Any order on Amazon Business can be easily tracked, just like your staff would on their personal Amazon account. In addition, we offer Amazon Business Analytics, which compares the order and payment history with your records, through the use of reconciliation reports. Your organization can identify trends by tracking purchases made by individuals and groups within your organization, thus using this information to further optimize spending. If your organization has Business Prime, you have access to Spend Visibility dashboards, which help identify purchasing patterns in a visually appealing manner to help management use insights to make quick decisions.

“With Amazon Business, it’s been such a breeze. Everything just ships from Amazon and my agencies can view all of the order information in one place.” — Heather Jones, Executive Director, Toys for Kids

In the continuing spirit of enhancing transparency, we have now introduced a feature called Donation Driver, which enables nonprofits to create wish lists of items the clients they serve seek. Instead of donors having to purchase items in these wish lists and ship to themselves and then to the recipients, this feature enables donors to purchase items, integrate with the nonprofit’s Amazon Business account, and ship the items directly to the recipients. This reduces the burden for donors and also helps clearly track items from donors to recipients through Amazon Business.

“Prior to creating our wish list platform through Amazon Business, the donation process for both donors and domestic violence programs was so time consuming that it deterred a great deal of giving. Now we’ve made the giving process easy. Donors just visit DomesticShelters.org and with a few clicks, they can select a local shelter, buy the items needed, and have the items shipped directly to the shelter. As a result, 5,789 items worth over $165,000 have been generously donated to domestic violence programs across the United States. Our partnership with Amazon Business’ innovative technology is truly making a difference in the lives of victims and survivors of domestic violence.” —Ashley Rumschlag, VP of Digital Services at DomesticShelters.org

Speaking with nonprofits, we recognize that they seek to be diligent in spending time and money on activities such as procurement that are important yet peripheral to their mission. However, nonprofits face the dual challenge of sourcing consolidation and shifting to a digital procurement system. We are committed to helping nonprofits address those challenges with our new Amazon Business Solutions for Nonprofits. In the US, we currently serve 75,000 nonprofits and 30 of the nation’s largest charities, and we’d like to extend our services to more organizations to help them further their missions.

“Amazon Business ensures National Association of Nonprofit Organizations & Executives (NANOE) members save money, work easier, and have the supplies they require to accomplish their important missions. Simply put, Amazon Business for Nonprofits is a matter of financial stewardship—it allows charities to keep more of the dollars their donors so generously share. We can’t recommend it enough.” —Jimmy LaRose, Co-Founder, National Association of Nonprofit Organizations & Executives

_{[1] Nonprofit Finance Fund Survey conducted among 465 nonprofit respondents in the US between March 18 and 23, 2020.}

_{[2] Nonprofits trends report published by Salesforce in 2020.}

_{[3] Survey conducted by Levvel Research in 2017 among 400 organizations across a variety of industries (including nonprofits) and market segments in the US.}