Not-for-profit organizations have to constantly be on the lookout for ways to grow and achieve their mission. In some cases, that could mean expanding a social entrepreneurship activity as a way to reach out to more people, or it could simply mean increasing fundraising activities.
No matter what decision is made, not-for-profits must have the fiscal security in place to support their goals. Today’s economy has been up and down, which may make it difficult to plan ahead and shore up finances to mitigate risk. It takes a comprehensive approach and a team of skilled professionals and advisors ready to help out.
In addition to these elements, not-for-profits must also keep an eye on current events in the industry. Recently, several new developments have emerged that could impact your organization and the industry as a whole. While it can be tough to track all these changes, we’ve compiled a couple key reports that may be of relevance to you:
Online giving could provide avenue for growth
Naturally, charitable giving is incredibly important for not-for-profits. Organizations may want to focus on one specific part of this process – online giving. In the Individual Donor Benchmark Report, the total average gift was near $400, but the average online gift was much lower, coming in at less than $100 last year, according to The NonProfit Times.
This report was based on a study of not-for-profit organizations and was conducted by Third Space Studio. The results indicated that there was a 79 percent uptick in online revenue in 2013 compared to 2012, but that only makes up 16 percent of not-for-profits’ overall revenue. This growing trend of online giving could provide opportunities for more not-for-profits in the future.
The study also noted that the smallest organizations brought in the most money online, with an average gift of $112 this past year, but super organizations – not-for-profits with a yearly revenue above $800,000 – saw more online donors on average, The NonProfit Times reported. The amount raised in 2013 also varied depending on size, with super organizations bringing in the most money and donors per year. On the other hand, smaller not-for-profits had an average gift of $336.
Overall, the survey outlined a discrepancy between how organizations are bringing in donations. Recurring gifts were a major source of income, while online giving lagged behind. However, the yearly increase in the amount of revenue gained online is a positive sign that this gap may narrow in the coming years.
Charitable giving forecast positive for industry in 2014
While charitable giving differs greatly depending on the size of the not-for-profit, a separate report from the Atlas of Giving organization indicated that donations are likely to increase over the remainder of 2014 for the entire industry.
The Atlas of Giving report stated that a 5.7 percent rise in charitable giving is predicted for 2014, according to The NonProfit Times. This is an uptick from the previous estimation, which initially was around 4 percent for the year. The organization judged 2013’s donation total at $417.8 billion for the not-for-profit industry, while the prediction for 2014 is $441.6 billion.
“In 2013 we experienced a fantastic, record-setting year for charitable giving in the United States,” Rob Mitchell, CEO of the Atlas of Giving, said in the initial report released at the beginning of 2014, prior to the revised charitable giving total. “Stock market growth fueled much of the giving but improving employment, growing real estate values, a lack of inflation, low interest rates, and acceleration in GDP also helped to make 2013 an especially strong giving year. Breaking the $400 billion mark is a historic event that bolsters U.S dominance of world philanthropy.”
More gains could be on the horizon for NFPs
These reports indicate positive conditions in the not-for-profit industry. If the prediction comes true and charitable donations continue to increase, it could lead to more a favorable environment for organizations to serve their missions.
However, any change such as this requires a close eye on the numbers. At Clark Schaefer Hackett, we know that this industry is incredibly unique, and that it takes a team of trained individuals to provide comprehensive tax, audit and advisory services. Thankfully, our experts are dedicated to the NFP sector year-round, so we know what issues you face on a daily basis. Contact us today to learn more about the current events facing your organization.