More Advice for Nonprofits Struggling in the Tough Economy

It’s no secret that the current economic recession is hitting nonprofit organizations particularly hard.  So what does this mean for your organization?  If you’re still plodding away with the same fundraising plan you’ve used for years, it’s time to stop and revisit your methods and expectations in light of the current financial reality.

Strategically allocate your resources. With so many cutbacks, it will be more difficult to find new sources of funding until market conditions improve.  Rather than directing resources towards a new campaign with a limited likelihood of success, consider dedicating some of your staff time towards the cultivation of existing relationships with funding sources and strategic planning within your organization to develop the strongest possible case for support.

Do your homework. Make sure you’ve fulfilled all the requirements for any grant funds you’ve already received, so you don’t inadvertently take your organization out of future funding streams.  Check websites and other publicly available information to make sure that a potential funder’s programs and priorities haven’t changed.  You don’t want to spend hours preparing an application only to find that the funder suspended giving for the year.  A more limited number of well-researched requests will likely bring in more returns than a form letter sent to every funding source you can find.

Check the accuracy of your information. Make any needed adjustments to your budgets and narratives as a result of changing market conditions, and make sure that the underlying basis for your requests is still relevant.  For example, if your narrative refers to the “skyrocketing cost of transportation” when gas prices have fallen significantly, funders may question the truth of your statements.  If changes in finances impact your use of grant funds, (for example, you received a $1,000 grant to purchase heating oil but only used $800, you received funds to offer 6 sessions of a program, but were only able to offer 4 sessions) you need to communicate the changes to the funder as soon as you are aware of the changes, and may need to return the surplus.  You cannot use leftover funds designated for a specific purpose for your other needs without the prior permission of the grantor.

Choose your requests wisely. The program most in need of funds in your organization may not be the one most likely to attract funding.  When prioritizing grant requests, ask yourself if securing funds for the “fundable” program would free up funds in your budget for the “not-so-fundable” program, giving you the same bottom-line effect.  Targeted program requests, as a rule, are generally more successful than requests for general operating funds.  However, as mentioned above, you cannot request funds for one program and then use those funds for another program.

Give the most bang for the buck. Provide specific examples of what your funding source would get for their money, and if you can, show how their funds will allow you to achieve greater returns.  For example, if you can say that for each dollar spent on administrative costs, you are able to distribute $50 in donated food to the homeless, $30 in free medical services, to reach 40 children through educational programs, etc., you’re demonstrating value to your funder.  Avoid making requests for recurring expenses if you could focus instead on a specific, one-time investment in capacity for your organization that would produce long term savings, such as purchasing a color printer to save on printer’s fees for producing your monthly newsletter, or obtaining a specific certification for your staff that would allow you to expand a program.

Cut costs-legally. You may find that it is more cost efficient to outsource certain aspects of your fundraising efforts such as grantwriting.  Remember that charitable fundraising is highly regulated in Pennsylvania (and most other states), and that any actions you take must comply with all applicable laws.  Also keep in mind that employment laws relating to independent contractors can be tricky and may have long term consequences for your organization.  Craigslist and other job sites are full of ads for grantwriters and fundraising staff that raise significant legal and ethical questions.  A consultation with an attorney experienced in these matters will ensure that your organization’s money-saving efforts are legal.


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