In case you missed this morning's conference call from the Nonprofit Finance Fund, here are their five recommendations for nonprofits in recession, edited for fast reading:
- Don't be a hero. If you are not certain that your funding sources will continue to contribute and support you as they have in the past, tighten your belt. Reduce your outflows.
- Make contingency plans for your "end clients." Reach out to your key financial supporters and discuss what is likely to happen to the people you serve in a recession. Your goal should not be to keep getting money flowing in, but to be sure you can keep serving the people you serve.
- Think carefully about big investments. "Risk means not having cash when you need it."
- Understand your donor patterns. Figure out how you are likely to fare under various scenarios.
- If your projects focus on those affected by recession, step them up! Many organizations, including government agencies, may have more funds prioritized toward those most impacted by recession.
What jumps out to me among these recommendations? Focus on the impact you are having on those you serve. If your donors know that where they put their money will have significant, visible impact, they will trust you and continue support. If you can identify opportunities to help people affected by recession, consider putting more focus in that direction.
Finally, make contingency plans, but don't assume that a recession in the United States or elsewhere will have a negative impact on you. But keep a close eye on what's happening to your donor patterns and make sure you communicate with them proactively.
Proactively reach out to donors and communicate your focus, your impact and the how you are being a responsible steward of their donation under periods of uncertainty. Make them feel good about their decision - and invite their opinions, too.