What To Do in This Economy?

This is the question on most people's minds whether working with a for-profit or non-profit organization. I am hearing from non-profit organizations that are cutting back on services, marketing and donor relations. All of these actions will have an impact on the organization and the community in which it serves.

Obviously cutting back on services will greatly affect the people who receive services. Plan and communicate service cutbacks carefully. Organizations that handle this poorly can gain a bad reputation that could take years to recover from. Engage the people whom you provide services for in the planning stages. Listen to what they are saying. Ask one or several members of the community you serve to become your spokespeople in the community to help soften the tough message of cutbacks.

Marketing budgets are typically the first to be cut. This is often seen as a non-essential function in an organization. Many non-profits don't even have a "Marketing " line in their budgets. Be very cautious here when evaluating what to cut. Do not mistakenly cut out activities just because they have a low return on investment. For example: perhaps you send out a quarterly newsletter and cannot attribute one donation directly to that newsletter. The reality is that if you have a well written, eye pleasing newsletter it can be a fairly inexpensive way to maintain relationships and even help people that are unaware of your organization to become more familiar with it. Other options could be switching to an online e-newsletter to save on printing and postage costs, or submitting the newsletter twice a year instead of quarterly. Sometimes seemingly low return on investment activities have benefits that are not measured in dollar value.

Lastly, if at all possible, do not cut back on donor cultivation. This means cultivating individuals, corporations and foundations. This reaction will harm the organization over the long run for several reasons. The first being-other organizations are cutting back in donor cultivation. You could have the competitive edge if you continue or even dare to increase your relationship building activities. If you don't someone else will and your donor will get bored with your relationship and eventually take their hard earned dollars elsewhere. Also, this economic downturn will not last forever. Donors will give more and more frequently again. It will be great if you cultivate relationships through these tough times and it pays off big for you in the future!

Roller Coaster Ride

Tracking the economy and its effects on nonprofits lately has me feeling like I am on a roller coaster ride. I have that kind of sick to my stomach feeling just after you leave the highest point of the ride and begin the lightning speed descent downward. I am glad we are securely strapped in.

It looks like working through the current economic conditions may take a while. According to an article published today by Guidestar titled "Fasten Your Seatbelts: It's Going to Be a Bumpy Giving Season" gave results of a recent survey. The survey states that 35% of respondents noticed a decline in giving. This is the largest percentage of organizations that have seen decreases since 2003. For comparison-only 38% of respondents noted increases this year in giving-compared to 52% last year that reported increased giving to their organization.

These are uncertain times for all of us. Next time, I will offer strategies for non-profits to weather the storm.

Trickle Down Theory

Today I am joining thousands of others by writing this post for Blog Action Day. The theme for 2008 is poverty. The idea behind this movement is to get as many people as possible to blog about poverty on this day in order to raise awareness and move toward viable solutions. I don't know if the organizers chose this theme in light of the current economic conditions, or if it is a very ironic coincidence.

Obviously the current economic downturn is going to affect how non-profits do business, just like it is affecting for profit businesses. I am hearing about cutbacks in services and personnel at non-profits because of the economy. As discussed in the last Take It For Granted post titled "The Economy and Reality" I cited an article from the New York Times that discussed how the assets from the foundations that were set up by Lehman Brothers, AIG and others have plummeted.

The majority of foundations in America have a large portion of their investments in the stock market. When foundation assets decline, foundations give less to organizations. When organizations receive less funding, they cut back on services.

This means that the impoverished, and I don't mean just cash poor people, but others who will loose their health care, or jobs, and the hungry will all loose out. For some people, they will be worse off than when they started receiving services from the non-profit organization that can no longer for example-help pay for childcare services. That single mom will loose her job due to lack of child care and then her car will be repossessed and she will be unable to find another job. She will be right back in to the cycle of poverty that she is so desperately trying to escape.

It looks like President Reagan's trickle down economic theory really is true. Only in this case the poor will just get poorer and the executives at the bankrupt businesses will get their millions in severance pay and bonuses.

The Economy and Reality

It seems as if the whole world is on edge the past few weeks due to the spiraling economic conditions in the U.S. I don't believe it is the end of the world, but I do think that the current events will have a negative impact on charitable giving in the immediate and foreseeable future.

Finally, someone with teeth agrees with me. Check out this NY Times article titled "Economy Expected to Take a Toll on Charitable Giving" I believe the most interesting point in this article is the vastness of the ripples that each of the bankrupted/overtaken corporations (or their foundations) will have on non-profits that serve communities of people.

Stay tuned for more...

Where Oh Where Have All The Grant Funds Gone?

Americans are feeling the economic effects of higher gas and food prices as well as the recent major issues in the financial markets. Nonprofit organizations are no exception. Or are they?

According to a June 28, 2008 article in the Philanthropy Journal, Americans "donated $306.39 billion to charity in 2007, more than ever before." Giving USA states that is a "3.9% increase compared to 2006." To put this in perspective, individuals give just about 75% of that $306+ billion dollar figure and half of that amount was directed to religious organizations. Giving from foundations rose 12% and corporate giving fell by less than 1% in 2007.

So where are these funds going? Nonprofit executives that I talk to around the country are scratching their heads. Across the board their organizations are experiencing declines in grant funding. These are the people on the front lines providing services to people in need, and they are cutting back. They are scaling down services, staff and using other cost savings methods.

So again, where are these funds going? It is my unscientifically proven belief that more individual, grant and corporate gifts are going to disaster relief efforts. Rightfully so. Communities ravaged by earthquakes, fires and hurricanes need help-and a lot of it.

Meanwhile organizations that serve other needs are continuing to scramble to keep their doors open.

GRANT CONSULTING SERVICES OPENS NEW LOCATION IN SAN DIEGO, CA

At a time when many companies are laying off their employees, or closing up shop, Valerie Nelson, President, of Grant Consulting Services announced the opening of a new office in San Diego, CA. “The decision to open another location is based on the desire to better serve our increasing base of national and international clientele.” Grant Consulting Services assists non-profit organizations in meeting their goals and objectives through comprehensive grant development services. These services include program/project planning, funding research, grant proposal writing, and grant reporting.

Heading up the West Coast office is Amanda Guerin, who has over 20 years of experience in working with expanding markets in varied roles. Amanda’s experience in living and working in locations around the world, such as West Africa, Israel, and the Grand Cayman Islands brings dynamic skills to the company that will empower the organization to better serve the unique needs of non-profit organizations.

Grant Consulting Services serves nonprofit organizations around the globe. The mission of the company is to affect positive change through the written word. Excellence and high value for nonprofits are unique and important aspects of the company.

For information: www.GrantConsultingServices.com or
Contact: info@GrantConsultingServices.com
Telephone: (248) 761-6256 Midwest Office
(619) 252-7189- West Coast Office

New Website

Check out our new website at www.GrantConsultingServices.com

More exciting changes will be announced soon!