Page 1 - SPLS 1 04_Assessment Task 1_M.Loots

Michelle Loots Assessment Task 1: Essay SPLS 1 04: Sport Structures & Sporting Bodies
Profit vs. Non-Profit
Organisations

Non-profit sports organizations combine having a passion for the sports within a community outreach as
well as personal development. Non-profit organizations often use a variety of sports to help support a
specific cause or to try reaching out to the groups typically that’s not able to take part in sports, such as
athletics (Allison & Kaye, n.d.). A for-profit sport structure is usually an organization that operates within the
private sector setting aims that will help the organization itself. This type of an organization creates shares
of ownership that is made available to the general public to buy. This type of organization primarily exists to
generate a profit (taking in more money than it spends). The profit could either go to the owners
themselves, or they could spend some/all of the profit on their business – they can also decide to share
some of it with their staff through the payment plans (McNamara, n.d.).

For-profit and non-profit organizations have some distinct differences. For-profit suggests that a company’s
goal is to make money, non-profit suggests that a company doesn't make money, they actually seek to
produce a revenue to serve specific organization missions, transferring most of the profit to the community.

Their biggest differences lying in organization oversight and management. Both the for-profit and non-profit
organizations should maintain a separation of their assets and liabilities between their employees and the
executives. Both of the entities are obligated to vote for and annual board of directors which holds their
regular meetings where they review the progress as well as the direction of that company.
Non-profits tend to have a board of directors that might consist mainly of voluntary members that brings in
their resources to help increase that organization's community outreach as well as help the fundraising
efforts. The volunteering labour force is quite distinct to the non-profit organizations sector, whereas the for-
profit organizations have paid employees and contractors to perform specific duties. The bigger non-profits
do have some employees on a payroll, such as local agencies, to run the organization.
(Leonard, 2019)

All companies have a distinct purpose, for-profit have a variety of goals (the primary mission being to
generate profit and the development of good products/services. These are the type of companies that
develop products/services that either should directly solve a problem or increase the overall efficiencies. A
non-profit company’s, in contrast, goal is not the profit, instead being dedicated to the promotion of a social
cause or supporting for a standpoint. Their services often attempt to solve important, and potentially life-
threatening problems. Their success is measured on a basis of that organization’s ability to accomplish its
humanitarian mission ("7 Key Differences Between Nonprofit and For-profit Organizations", 2016).

One of the most important aspects is establishing a consistent method for the funding of different projects
and operations. These organizations tend to fund their efforts through bank loans, maybe some local
investors and from the revenue that they’ve generated from their sales. If a product/service is considered to
have a high potential market value, the company could have an opportunity to receive more funding, but
from national or global investors instead. Non-profits often seeks out any private donations of time and
money, corporate sponsorships, government grants, etc,. A form of online fundraising, known as
crowdfunding has also become a popular amongst non-profit organizations as method of funding as of late
("7 Key Differences Between Nonprofit and For-profit Organizations", 2016).

These types of companies usually have more defined target audiences than their non-profit counterparts. A
for-profit company seeks to reach and establish relationships with their consumers who’ll purchase their
products/services to generate revenue. These relationships create continual feedback loops, which allows
that company to increase its revenue and to expand its offerings to help reach new target audiences. Non-
profit companies typically approach their audiences with the message about their product, service or action
- must try to reach a more diverse audience which needs to include volunteers, donors, corporate
sponsors, and the public. Non-profits must carefully consider what their interests are in each segment of