Ready for Revenue Planning? 5 Qs to Ask Yourself
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National statistics show that individual giving and earned income are the leading income sources for charities, but they might not suit YOUR nonprofit's unique situation. So how does your nonprofit choose which income streams to develop?
Before you jump on that next hot idea for fundraising or marketing, your org should ask itself the questions that our experts presented in this live chat. Your answers might indicate that those hot ideas will yield lukewarm results at best, or may even burn you.
- Revenue plan comes after strategic plan, and before business plan. Mission is the primary driver.
- Every nonprofit's situation is unique, so there are no "perfect" answers, funding mix, or examples of revenue plans that will fit all orgs.
- Evaluate revenue opportunities for their return, mission advancement, resource demand, and risk. "You want to be in the sweet spot of high mission and high net revenue potential."
- Create multiple revenue plans based on different scenarios and sets of assumptions so your org can respond quickly if you don't reach targets.
- Board members and leadership must be committed to revenue plans and the process.
Click on the chat window to get the questions and read the full transcript.
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"The lack of a revenue plan almost always ensures that an organization will leave both money and mission impact on the table."
Nancy Osgood, Founder and President, The Osgood Group. Nancy's work across diverse industries and functions falls into two broad categories: revenue generation (earned and contributed) and large-scale planning and restructuring to support profitable growth. Read more...
"Understand which revenue markets tie to your social issue, with evidence of the size of the market....Many nonprofits set revenue targets based on what they need, not what they can get."
Stephen Pratt, Director of Financial Sustainability, Root Cause. Steve is working to develop more rigorous financial models for clients and to share how these models are developed for the sector. He will be publishing a white paper in January on the divergent understanding of funders and nonprofit leaders on the meaning of financial sustainability. Read more...
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