Managing in a Down Economy, pt. 4

In intimate conversations with major donor prospects, it is possible to be more open about financial realities—in fact, it’s preferable.

Lead with your mission—the service you are providing to your community. This is particularly valuable when you can show that you are part of the solution to the economic stresses facing your service area.

Then, be open about the steps you have taken to economize. While assuring prospects that your organization always strives to be as efficient as possible, demonstrate the special steps you have taken to ensure that you are providing maximum social return on each donor’s investment. By showing how you have cut overhead, you document that further cuts will impact service.

 

With that groundwork laid, present details on your financial situation and the consequences to the community. Remember, this conversation isn’t about you—it’s about the service you provide.

Then, listening and watching for clues as to the donor’s ability to give, it may be time to ask if they can help to preserve that service. Be specific about how they can help solve this challenge to their community.

Managing in a Down Economy, pt 3.

You’ve done your assessment. Your local economy is tanking and it is affecting your donors. How do you communicate in the midst of this turmoil? 

In this post, I’m going to emphasize the general message—what you say to the community and to your rank and file givers. In a few days, I’ll turn to the more specific messages you can send in face-to-face conversations with major donors.

In general messaging and the “mass market” part of your donor base, avoid fueling the psychological fire by making the economy the central theme of your message. (Yes, I’ve seen organizations do this.) Instead, lead with your strength, the service you provide to your community and the value you represent. Position yourself as a problem-solver, not another burden on community resources.

Emphasize not your needs, but your community’s need for your service at this time. The reason to contribute to you is not because you’re in tough times, but because those you serve are. You’re the solution. (Don’t cry poor. If your organization feels the pinch, others are too.)

Find good news where you can and  highlight it. Something is going well. Tell people about it. Like a tall peak, generate your own weather.Particularly during tough times, your givers and the community at large will welcome positive messages and be impressed by the fact that you’re doing such good things during bad times.

Managing in a Down Economy, pt 2

We continue with our series of discussions on managing and fundraising in a down economy. In our last post, we discussed the importance of making certain your organization is operating as efficiently as possible, both for the purposes of financial efficiency and appropriate donor and gift stewardship.

A second very important step is to assess economic conditions within your community and among your donors. The fact that conditions are difficult nationally does not mean that your service area is feeling the pinch to the same degree. State capitals, for instance, have proven relatively immune to economic swings, as have financial centers. One of our clients has experienced only a modest housing slowdown. This is where having a savvy, well-connected board can be invaluable in giving you high-level information about your own market.

Having gained a realistic view of your own economic environment, assess the affect that these conditions have on your donors. Foundations were severely affected by the last economic downturn, but have been less so this time—so far, at least. Due to the combined impact of the housing/finance bubble and the inflationary ripple of rising energy costs, middle class donors of smaller amounts to your organization may be particularly vulnerable. Ask yourself who is contributing to you now and how economic conditions are affecting them. Some may be relatively unscathed.

The central point is to avoid being consumed by national trends and focus on your community of service and your donors. Having done that, you can move on to minimizing damage in areas that are the most vulnerable and maximizing opportunities in those that are the least.

Managing in a Down Economy, pt 1

I have been through my share of recessions as a non-profit manager and fundraiser. For reasons stated in my last post, I believe this downturn will be protracted. Over the next few days, I’ll share some survival tactics based on what I’ve learned.

The first step is to get your financial house in order. Poor economic times are ideal for making the kinds of efficiencies that you need to make and perhaps should have been making. Your board, staff, and volunteers understand the need for cuts better in lean times than they do when times are good. It’s counterintuitive and a bit perverse, but it’s a fact.

Moreover, by trimming your budget of things that aren’t absolutely essential, you’ll be able to make a stronger case to donors when and if you must turn to them for additional support. One message I was able to make during the New England recession of the last eighties and early nineties was, “We’ve done our part. We’ve done what we can to reduce expenses without threatening our mission.” We were also able to make the case that the staff was working harder to provide needed services to the community.

When we asked our donors to meet us halfway, they responded generously.