Planning To Make A Profit For Your Nonprofit Organization?

Planning To Make A Profit?

How do you know if your efforts are making you money? Do you know what the actual profit was for the last event or campaign you hosted? Can you improve upon the profit generated one year over the next? The only way to know this is to plan to make a profit.

The first step in planning is to make a budget. If you are a small group, ask your treasurer how much they have in the bank. Understand what the goals that you are trying to achieve this year. Are you attempting to replace band uniforms for 50 band members? Are you planning a special long distance trip for your youth group? Are you proceeding toward setting up a holiday meal for the homeless? Regardless, this gives you an idea of what you can comfortably afford to spend on necessary items to pull off your event.

Larger groups such as a Boy Scout Council plan a budget for every event they host. Camporees and banquets require funding just to host the event. These groups charge a nominal fee for these events, but still make a small profit.

Items that you should consider are: invitations and/or tickets, postage, printing, insurance, programs with planned events for the day listed, food and drink items, utensils and paper goods, flyers printed, security personnel, band or speakers fees, rental of space for the event, audio/visual rental or purchase, banners or posters, pens, paints and markers, door prizes, tape and glue, receipt book, etc.

Have each member of your committee polled on what they can get donated; however, keep the item as a part of your budget. If you receive a donation, then this is unexpected income that will push you way over your goal or it will give you a cushion if not as many people show up as planned.

Keep in mind your fundraising goal. If your goal is to raise $3,000 for band uniforms, and you expect to ask $10 to attend a spaghetti supper, you should expect to have 300 people attend. Make sure you have enough space available to host this many people.

If your costs from your budget show that you expect to spend $600 on everything, then you should expect 60 more people to attend in order to achieve $3,000. This is the profit margin that you want to achieve.

Therefore, you want to raise $3,600 at your event. Will the food quantities handle 360 dinners? If not adjust your budget accordingly. There is no guarantee that you will have 360 people attend your event.

Next, estimate the number of people you expect to attend. Look at the past year's turnout. If this is your first event, you should be looking for a benefactor to buffer any losses that you may receive.

Ask your Executive Board to equally pledge a certain amount. Mention that your intent is to pay back the borrowed amount once you achieve your profit goal.

By planning ahead, announcements can be sent out one month prior to your event. Ask that the ticket cost with RSVP be sent in to you at least two weeks prior to your event. Give a deadline for the money to be turned in by. This will help give you some funds to pay for the items you need without borrowing the initial funding requirements.

Next, call around and get the best prices for the item you will include in your budget. Once the cost of each item is identified, total it up. This is your budget.

Divide the budget by the number of guests you are planning to attend. This is your minimal cost for each person to attend. Now add your profit margin to this cost and you will have the cost of your "ticket" for persons attending.

Your profit will be what you take in at the door minus your costs. For a percentage, divide the net by the gross amount.

Don't forget to have extra items for sale included in your initial invitation letter. Offer a special coffee mug for $6.00 or a T-shirt for $8.00 that depicts your groups message. They can pay for it when they send in the RSVP or reserve the item and then pay for it at the actual event. Have a business pay for these items either with a small advertisement on the item, flyer indicating the generosity of the business included with each item, or as a straight away gift. This will bring in extra money that can be saved for next year's budget costs.