This list identifies sixteen places where nonprofits leave money on the table.The list is much longer especially when it comes to voluntary based membership organizations and that will be a separate section in a later blog. As you read them many of you will do a quick check and notice that you are doing many of them. There many be one however that is overlooked or assumed that the strategy does not work.
The Opportunities
1. Paying for products or services that you might obtain as in-kind gifts. One of my clients identified over seventy thousand dollars in opportunities, or nine percent of their budget.
2.Waiting for the right timing to pursue new revenue streams. No one knows what tomorrow will bring. The river of opportunity flows now. Someday is not coming. Reach in and grasp the best opportunity you see.
3. Accepting free or low cost opportunities, when the best value comes from paying full price. It’s one thing to buy generic dish soap. It’s negligent to buy generic expertise, whether it’s consulting or architectural services. With the first, if the service or product fails, you select a better alternative next week. With the second, you waste the community’s time, handicap your organization, and inevitably loose money you can’t afford to loose.
4. Delegating income development down. The CEO and Board must retain leadership in developing revenue. They stay with it until the source is stable and staff masters the tactics.
Over-focusing on grants. While grants represent excellent opportunities to grow new efforts, purchase capital items, and fund one-time capacity building efforts, they’re lousy for operating and repetitive expenses.
5. Over-focusing on the same (small) pool of donors. Donor burnout occurs because we don’t have enough donors.
6. Focusing only on mission, when you must generate mission plus revenue and grow a community—every nonprofit’s triple bottom line. Like many small businesses, most nonprofits stop at being good tactical specialist, when they need to become good at organizational leadership. The former excels at outputs, the later at sustainable organizations. By focusing only on mission, you loose income and its origins: community support.
7. Failure to involve all staff in revenue development. Everyone has a role. Empower everyone. This year, I worked with a Salvation Army—yes this included helping a kitchen manager, program mangers, and social workers understand how to generate income. They began the process feeling “spooked,” and ended it feeling empowered, proactive, and encouraging their co-workers from other locales.
8. Assuming the nonprofit has already maximized earned income. Two commonly missed opportunities? Customers who are not part of your regular customer base, and new service to your current customers.
9.Being closed to considering ways that current customers or members might be charged a fee—even hypothetically. Or any other similar rule that starts, “We would never………..
10.Continuing to try to solve challenges in-house that have flummoxed staff for years, when expert advice is available. Last month a national nonprofit shared a challenge they’d fought for years, and before I left the building I outlined a strategy to solve it.
11. Not recognizing that you are on a personal philanthropic journey. Understanding your traveling, too, will also help you to relate with the donors you ask to give.
12. Failing to educate and empower board members as part of your resource generation team. Too often this leaves them, out of ignorance, blaming staff for income shortfalls.
13. Playing, “I see dead donors,” an exercise that involves believing that life would be easier if you only had another nonprofit’s advantages. The grass is not greener in the arts, around pets, with nonprofits that serve children, or in more desirable locations. (Leaders from those groups envy something about your donors.) Focus your energy on finding more people dedicated to your mission.
14. Hiring development staff based on the dollars the candidate earned elsewhere. Success depends on the cause, the case, the groundwork, and timing.
15. After they donate, failing to provide donors with what they need, including that:
*Their gift was received,
*It was put to its intended use,
*It was appreciated.
Keep in mind that renewals cost less money and energy than new obtaining new donors.
16. Not challenging mythical thinking about obtaining income. No secret cash machine exists. Revenue results from strategic investment in ideas and disciplined work.
