Even before the COVID-19 pandemic began, many non-profits weren’t in their best conditions. Unfortunately, like all of us, many non-profits weren’t expecting the economic downturn, leaving many of these charities and organizations without a reserve fund to help keep them afloat. With fundraising events canceled and donations slowing down or completely stopping, many non-profits are struggling to survive. And with the pandemic showing no signs of disappearing any time soon, it’s up to the leaders and teams of these organizations to make the shift and keep up with the new normal to continue helping those in need.
Evaluate Your Financial Position
At a time like this, cash is king. With little to no revenue coming in, you must know where your non-profit stands financially. Compute your organization’s monthly expenses against its revenue, so you can see how long your funds can survive the current situation. If you still have a lot of funds reserved, you may be able to take small steps to conserve your cash. If you’re in dire straits, on the other hand, you might have to explore new ways to stretch your cash and find additional sources of revenue. This can be done by reducing costs, delaying payments, and finding new ways to start a fundraiser safely.
Reduce Your Expenses
You can’t run a non-profit without any funds, and to do this, you’re going to have to make some sacrifices.
Don’t Let Go of Staff
While it sounds unbelievable, you don’t need to let go of your staff to cut costs. Instead, consider different alternatives like reducing work hours, decreasing or temporarily removing employee benefits, or reducing salaries. While it is important to show your employees how important they are to the organization, this step may be necessary to keep the non-profit running.
Transition to Remote Work
The cost of having an office usually takes up a significant part of operational expenses. This is especially true for businesses that continue to run in the early months of the lockdown when stay-at-home orders were in place. Continuing that streak may prove more cost-efficient and safer for your organization and its employees.
Negotiate with Vendors
As remote work is on its way to becoming the new normal, the need for office maintenance or food services is considerably less. You might also find that you may not need all the computers, printers, or software licenses you originally did. If you choose to terminate your vendor contracts, make sure you check for any fees or penalties before doing so. You can also reduce the number of vendors you buy from and consolidate your orders between your chosen vendors. This will give you what you need at a lower price and reduce the number of people you will have to communicate with when you need something.
Cut Off What You Don’t Need
The rule is simple: if it’s not essential, take it out of your expenses. Review your expenses and see which ones you and your organization can survive without.
Rethink Your Strategies
Restructuring a non-profit organization is no easy feat. Still, it can become an efficient way to gather resources, collaborate with other organizations, and widen your reach, all while bringing down costs. Restructuring methods differ between organizations, but they often include
- Mergers, where two separate entities combine and form a single entity,
- Acquisitions, when one entity purchases a majority, if not all, of another company’s shares or assets,
- Partnerships, where two or more entities can join together to operate a certain aspect of one entity and share the profits,
- Consolidations, where two entities join together to make up one new entity; and
- Separations, where an entity cuts off its arrangement with another entity.
Streamline Your Business Processes
If you have any repeated business processes that help accomplish your organization’s goals, consider streamlining these processes. By doing this, you can manage your organization more efficiently and save money at the same time. Consider collaborating with SAP gold partners that can help your non-profit get the tools it needs to automate business processes.
It’s important to remember that, no matter how many changes you make to your non-profit organization, you need to stay aligned with your goals and allow that to be the motivating factor to keep it running and growing. While all the uncertainties can be daunting, knowing where you stand as an organization and creating new ways to achieve your goals despite the crisis is the first step to thriving in a post-pandemic future. This way, it doesn’t have to suffer losses amid the crisis.