The Plan That Turned a Profit - For the First Time in 7 Years!
The Story
When I stepped into the role of Executive Director, this organization had been through the ringer. It had spent years in an extended construction project on its property. This had closed the primary revenue stream for the organization. Additional challenges that came along with construction greatly reduced the earning potential for other streams of revenue as well.
This organization was also navigating a quickly changing marketplace that was putting many in our industry out of business. Only one week after I excitedly took on this challenge, COVID hit and we had to pivot to fully virtual operations.
We had been operating at a deficit and living off of reserves for 6 years. How would we stop the bleeding?
The Plan
Goal: Reach a Break-Even Budget
Strategy 1: Right-Size Staff
This is one of the hardest strategies to tackle. No one wants to be in the position to let go of staff. But in light of a shifting marketplace and a global pandemic, it is a decision many businesses have had to make in the past few years. We re-evaluated our needs and our budget, reorganized job descriptions, and made the tough decision to downsize. Gratefully, we were able to do it with full transparency to the staff, all of whom have landed in great new roles.
Strategy 2: Maximize Income
Next we worked to maximize our earned income. Even as a nonprofit, we did have some opportunities to earn income outside of donations and grants. We pivoted to a fully virtual model, changed our pricing strategy to match the marketplace, re-aligned programming to meet relevant needs, and leveraged partnerships to boost attendance. Through these efforts we tripled our average program attendance and even sold out two virtual events - for the first time in the organization’s history.
Strategy 3: Increase Donor Contributions
As any nonprofit worker knows, fundraising is the bread and butter of the budget. As a part of this plan we pulled off the most successful fundraising campaign in the organization’s history - times four! In fact I wrote a whole blog post about it that you can read here.
The Results
These graphs reflect real data.
The results of implementing this plan were astounding.
The previous year we had only reached 80% of budget.
By the end of this plan, we had reached 120% of budget!
We turned a deficit of -20% into a profit of +20%.
We didn’t just break even; we made it solidly in the black for the first time in 7 years.
By taking a hard look at our current reality, setting clear goals, and planning strategically to move from Point A to Point B, we were able to achieve great success as an organization.
