Among the many benefits of House of Hope’s new food preservation program is a way to create and sell packaged food products, yielding a small revenue stream to support the non-profit’s other programs.
The idea of engaging in activity that supports the overall mission of hunger relief, while also allowing for some revenue generation on the side is gaining attention among non-profits as government funding becomes more precarious. Such so-called social enterprise activities can help to temper the blow of reduced or canceled government support.
“Alternate revenue is becoming more important,” said Robert Ranieri, Chief Executive Officer of Fla.-based House of Hope, which this year is not receiving any of the $300,000 or so it would typically expect to get from government sources. “We’re trying to find ways to fill in some of those gaps.”
House of Hope is using a new $100,000 grant to expand its food processing capabilities with freeze-dryers, food dehydrators and shrink-wrapping machines so it can extend the shelf life of the food it distributes, better serve clients experiencing homelessness, and be prepared for emergencies. At the same time, it will pursue agreements with local restaurants and food markets to sell pickled vegetables, dried fruits, vacuum sealed fresh produce and other products made with its new equipment.
The non-profit already generates a couple thousand dollars a month by selling about 10% of the produce it grows on its farms and greenhouses. Its biggest money maker by far is its thrift store operation, whose three stores last year generated about $1.1 million in sales. All in all, about 28% of the non-profit’s $4.4 million of revenue comes from its social enterprises.
The non-profit plans to grow that amount further by getting certifications and licenses so it can start to clean and pack produce on behalf of local farmers. “The next step on that revenue generation side is, ‘How can we monetize our packing house?’” Ranieri said.
House of Hope is not alone in thinking more strategically about social enterprise businesses. Food Bank of Eastern Oklahoma has a plan for 25% of its budget to come from earned revenue, and already has made inroads into selling cookies and laying the groundwork to provide semi-truckloads of ice to large local events. Now it has built a catering company out of its new 12,000-square-foot production kitchen, the largest non-profit kitchen in Oklahoma.
Table 24, named for the 24 counties the food bank serves, is a 600-person event space located above the new kitchen. With little promotion aside from word of mouth, the food bank already has hosted several large events in the space, including its own annual fundraiser. Starting in September, it will begin marketing Table 24 to event planners.
The food bank expects $500,000 in catering revenue next year and may “blow right by” that amount, said CEO Jeff Marlow, given it generated more than $250,000 in fiscal 2025 without doing any promotion. As a former chef who catered to high-end country club clients for years, Marlow is familiar with the target market of “hundreds and hundreds” of corporations in Tulsa and the surrounding area, all of which have events that need to be catered.
Table 24 will offer a high-end experience combined with a tax write-off and the promise of dollars spent going toward the food bank’s mission. “It’s an amazing story,” Marlow said. “Who doesn’t want to get behind that? I feel like there’s going to be a really good market out there.”
One of the challenges of running a social enterprise business within a non-profit organization is ensuring that the side business does not take away from the mission. At San Antonio Food Bank, which has run its Catalyst Catering business since about 2004, the impact of social enterprise revenue has waxed and waned over the years by design.
Catalyst Catering brought in about $1.5 million in revenue annually before the business shut down during the pandemic. Since then, the food bank has put less focus on it as a revenue generator, currently generating about $250,000 in revenue from it, said Eric Cooper, CEO, who cautioned against a full-bore embrace of social enterprise. “There’s a level of distraction and intellectual, emotional and tactical demand that running that business takes,” he noted, adding, “I think it’s a real productive journey for a non-profit to understand their appetite for it.”
In addition to catering events, Catalyst Catering showcases the food bank’s training program for culinary professionals, making it the catering company of choice in the region for many years. At the same time, catering to high net worth individuals, politicians and elected officials sometimes brought high expectations for service that could result in minor misses that needed to be repaired. “I think we struggled for a few years on how big and how much resources to put into it, because it does open the door to different types of customer service opportunities and challenges,” Cooper said.
Food bank executives agree that having a diversified revenue stream is important. At most organizations, investing in fundraising will likely yield more revenue than a social enterprise. But a social enterprise that capitalizes on a food bank’s strengths in a low-risk way can also be powerful.
Food Bank of Eastern Oklahoma, for example, is relying on contract labor until it has enough events booked to justify bringing on full-time staff. It also didn’t have to invest in any new equipment to open its catering business. In addition to a sizable chunk of revenue, the food bank expects Table 24 to bring the food bank lots of positive exposure, Marlow said, adding, “You can’t put a value on that.” – Chris Costanzo
PHOTO, TOP: Table settings at Food Bank of Eastern Oklahoma’s Table 24 event space.
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