Food for thought: with schools combating childhood obesity, how are food-oriented fund-raising companies dealing with that issue and changing/refocusing their product lines/strategy to maintain a piece of the multi-billion dollar business? Conversely, how is this helping non-food companies?

Goodies like candy, cookies, pizza, and myriad tasty treats--a.k.a. "junk food"--have been traditional staples of fund-raisers. But in the wake of child obesity advocacy, schools and administrators are taking a firm stance on nutrition and thus may be forced to seek out fund-raising alternatives.

According to a report published April 25, 2007, by the Institute of Medicine--which partnered with the Centers for Disease Control and Prevention as directed by Congress--there are a litany of recommendations about appropriate nutritional standards for the availability, sale, content and consumption of foods at school, with attention on "competitive foods."

The report states: "Schools should allow only Tier 1 products to be sold as fund-raiser items on elementary and middle school campuses; high schools could allow Tier 2 items to be used for on-campus fundraising. Schools should encourage products used in celebrations such as holiday parties to meet the standards. Likewise, schools also should encourage foods and beverages sold at after-school and community events that include adults--such as athletic events and PTA meetings--to conform to the standards."

Examples of Tier 1 foods include whole fruit; raisins; carrot sticks; whole-grain, low-sugar cereals; some multigrain tortilla chips; some granola bars; and nonfat yogurt with no more than 30 grams of added sugars. Examples of entree items that meet the criteria are a fruit salad with yogurt or a turkey sandwich.

Tier 1 beverages are plain water, skim or 1 percent milk, soy beverages, and 100 percent fruit or vegetable juice. Because of their calorie content, juices are capped at 4-ounce servings for elementary and middle school students and 8-ounce portions for high school students.

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Tier 2 items include single servings of baked potato chips, low-sodium whole wheat crackers, graham crackers, pretzels, caffeine-free diet soda, and seltzer water. The report states that Tier 2 beverages should be available only after school because students may otherwise forgo healthier choices such as milk and juice.

In addition, sports drinks should be available only to students engaged in an hour or more of vigorous athletic activity, at the discretion of coaches. The committee also recommended against making fortified water available as either a Tier 1 or 2 option.

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The Association of Fund-Raising Distributors & Suppliers (AFRDS) is encouraging school officials to take prudent action to promote the health and well-being of their students and allow fund-raising candy sales to continue as allowed under federal, state, and local regulations. Otherwise, as they note, a critical resource for schools will be lost.

According to the AFRDS Web site: "Examining food consumption by students at school makes sense. Improving physical and nutritional education programs also makes sense. But eliminating choices in school fund-raising--where decisions to purchase or consume food items are made off school grounds and largely by adults--will not effectively address the child obesity problem. Rather it will serve only to further another crisis--inadequate funding of education.

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"State and federal law and policy makers recognize this and, to date, there are no federal or state restrictions on food or beverage products offered as part of a school fund-raiser when the sale of products is intended to take place off the school grounds and after the end of the school day."

Two of the biggest food-oriented fund-raising companies are Little Caesars Pizza and Krispy Kreme Donuts.

The Little Caesars fund-raising program has been in existence for 10 years, and, according to Joan Rivard, vice president, Little Caesars Pizza Kit Fund-Raising Program, the company has always been committed to helping the organizations, schools, and sports teams it works with by providing nutritious meal and snack alternatives for busy families.

"We've always promoted the healthy side of the equation where a pizza baked in your own oven can be a centerpiece for a nice healthy meal, when you include a salad, pasta, and chopped vegetables," said Rivard, who claims the company has not felt any residual loss in sales.

In 2003, Little Caesars added a 100% whole-wheat crust pizza kit. The company will introduce low fat mozzarella cheese in the near future. The cookies and cinnamon swirl dessert items remain status quo.

"This is all direction we take from our customers," Rivard said. "Every year we add a couple of new products based on what our customers are telling us in terms of what their needs are, and again, their concerns for providing healthy meals and snacks for their families."

Rivard says the feedback with its customers is done via focus groups, e-mail exchange, surveys, and the solicitation of recipes for the Little Caesars Web site. Comment cards are included in the pizza kits.

Furthermore, the company includes all of the nutritional information on its Web site.

"The key is moderation," said Rivard. "Everything should be portioned for the family to enjoy it, but not in excess."

Brian K. Little, director of corporate communications for the Krispy Kreme Doughnut Corporation, offered his company's take on the matter: "Typically, Krispy Kreme fundraising products--including certificates, partnership cards, and doughnuts--are not sold during the school day. Our products are an occasional indulgence that can be enjoyed as part of a healthy, balanced diet."

That being said, the promotion of "healthy fund-raising" is gaining momentum. While food-oriented companies focus on introducing low fat, sugar free ingredients, non-food companies are chomping at the bit waiting to see if it results in increased revenue.

"Historically and currently, the biggest slice of the pie is the candy companies," said Jeff Ellenberger, president of Dutch Mill Bulbs. "But you are seeing that change. Magazine sales are probably the second most used fund-raiser. And then you've got scratch card, flower bulbs, and all the rest of them. That big slice of the pie is going to be shrinking, obviously. The need for fund-raising continues because of escalating costs and tightened budgets.

"All of us non-food folks are hoping that it's going to provide more business for us. The focus is kind of changing as to what fund-raising sources are using."

Therein lies the challenge for fund-raising companies. Being proactive, adding line extensions, and thinking outside the box are critical as the current state of fund-raising evolves. Companies must improve and enhance the fund-raising appeal going forward.

According to Pete Bryden, associate director for the ESPN The Magazine Fundraising Program, the overall climate in the fund-raising business is changing.

"I don't think there's a full impact as this point," he said. "I think it's still another year away before some of these companies are going to really feel the major brunt of it. I personally think that everybody across the board in all of fund-raising, just because of the different environment, has felt a hit."

Justfundraising.com is one such company that has thought outside the box.

A visit to the company's Web site will reveal the tried and true candy bars, lollipops, scratch and discount cards, candles, gift wrap, in addition to a brand new cookie dough fundraiser. However, it has developed a new and exclusive fund-raising product: the AmberWatch Fund-Raiser. The AmberWatch is a child's wrist-watch that features a super loud alert signal that the child can activate when they are feeling threatened or scared.

"Fund-raising groups are looking for different ideas," said Dean Lazzara, marketing director for Justfundraising.com. "They're looking for added value in the product. They're looking for higher quality products. They are tired of selling the same old, same old."

Lazzara added: "We're a little different because we offer such a broad range of products. We haven't necessarily seen it affect us directly. For instance, we haven't had a drop in sales or any major issues. But as a company that I would say has been more proactive than most, we have developed products that are outside the controversial products. The AmberWatch Fund-Raiser is an example of that."

Justfundraising.com met with the AmberWatch Foundation and the mutual goal was simple: Bring awareness to child safety with regards to abduction.

The AmberWatch Fund-Raiser has been in place since November 2006.

The watch sells for $29.95 and any team or group keeps $10 per watch, with no money down. It features a child safety alarm that emits 115 decibels (an ambulance emits 120 decibels). The battery allows for 45 minutes. It also functions as a stylish wrist-watch, featuring super bright LED lights, and is available in five styles. Although it has been promoted mainly towards children it can also be worn by adults.

"It's a win-win fund-raiser that creates a lot of benefit as student-athletes can raise money for their own purpose, Lazzara said. "Secondly, they are also able to bring safety to their respective communities because kids are wearing the protective watch. Lastly, they are raising funds for the foundation by selling the watch."

Josh Bandes, owner of EZBands, is also championing the idea of his company being a viable and significant fund-raising alternative.

"The way I look at it is, the use of our wristbands are saving children, not possibly hurting them with sugary and fatty foods," said Bandes, whose company has been in business since 2005. "Our wristbands are raising money for kids who may be in the hospital and not putting them in a hospital. We don't have customers calling us and saying, 'Hey, we don't want to do any food fund-raisers.' But in some school districts, we may have five schools that say, 'Let's get wristbands together.' It's a community type thing. There's no real way to find out definitively what a school's buying decision was. If you think about, it's much cheaper to get these wristbands than to do a food fund-raiser."

EZBands promotes its 100% silicone customizable wristbands as a way for sports teams, booster clubs, and other groups to raise both pride and awareness for a cause, while simultaneously raising a substantial amount of funds.

EZBands are available in a variety of 86 solid colors, plus tie-dye swirl (two or three different colors) or striped wristbands (up to 6 different colors on the same wristband). There's a choice of font, text style (debossed or embossed), and deboss color-filled or screen-printed. Logos, symbols, and mascots are included free. Production takes about two weeks.

There's a minimum order of 20. The price per piece of EZBands is $1.06 for an order of 250. The company suggests selling them for $3 each ($485 profit) or two for $5.

"Anyone can wear these wristbands," Bandes said. "Little kids who are supporting their older brothers or sisters, parents wear it also. It's a universal product. You also have a walking advertisement for your organization or school for years to come."

While it's still too early to tell how the new nutritional standards will affect the fund-raising business, it does bear watching.

Dutch Mill Bulbs' Ellenberger, for instance, says that while his company cannot change its produce line too dramatically--after all, it is dealing with fund-raising groups and not master gardeners--it will have to watch trends much closer.

"When we compare our sales to previous seasons, that's when we are going to find out if this trend away from the food fund-raisers is really affecting us," Ellenberger said. "We're coming off a pretty strong spring season. I do expect an increase in sales when we close out for the fall season. It's not anything like 20% or anything like that. Maybe we are starting to see a little bit of the affect now. But it certainly does create an advantage for non-food fund-raising companies."

Said ESPN's Bryden: "For folks who are on the fence trying to find a new fund-raiser, other companies, us included, might help. But I think folks who did really well with some of the products like candy or cookie dough will continue to use them. I would think some of the companies would be smart enough to change their ingredients, which would be a good thing for them."