Preparing for a Recession: Survive and Thrive
How your Nonprofit Can Continue Serving your Mission Suring the Incoming Recession
This is a guest blog submission by Meredith Gray, Senior Marketing Manager, Keela
The impact of COVID-19 on the economy is significant, and all signs are pointing to an incoming recession. While we can’t know for sure what we’re getting into, we can look at the past and begin preparing for a recession with the information available to us.
During the Great Recession of 2008, total charitable giving dropped by over 7% and continued to decline until 2010. 7% might not sound like much, but when translated to dollars and cents, American nonprofits saw a decline of over $41 billion dollars between 2008 and 2010.
Yes, that statistic is right. Because of this loss in revenue, 13.5% of American nonprofits were forced to close their doors during the Great Recession, leaving a community behind that had been dependent on their resources. Sadly, these nonprofits were not prepared to weather the storm of a recession.
Any recession, no matter how big or small, will definitely have an impact on the financials of all organizations regardless of if they are a nonprofit or a for-profit. Roughly 9.6 million jobs have been lost during the COVID-19 pandemic, resulting in a significant impact in charitable giving, and also a huge increase in demand on the services provided by the nonprofit sector.
When looking more closely at specific organizations, a case study on the United Way reported a 68% increase in demand for their services specifically for those in need of food, warm clothes and shelter. The vast majority of that increase is linked to job loss and evictions.
Now, we’re not trying to scare you, but you did click this post to learn how your organization can begin preparing for a recession, right? Being prepared, learning from the past and looking at technology is a great starting point. So let’s get started!
1. Assess Your Current State by Getting to Know Your Stakeholders
Preparing for a recession starts with understanding the current state of your organization by diving deep into your revenue, costs, skills on your team and your stakeholders. The need to be nimble during times of crisis is critical, and having a deep understanding of these things will allow you to make quick decisions to address needs as they arise.
Understanding who your supporters are is vital to your success. Knowing what motivates them to give to you can help you create more personalized communications and strengthen your relationships. It’s important to understand your database and start stewarding your biggest supporters. These are the people that are going to get you through tough times, you can’t afford to lose them and keeping them engaged and recognized will motivate them to continue their support of your organization.
But how do you gain a deep understanding of your stakeholders with such a large donor database? Your staff and fundraisers need to find new and different ways to raise money. With a recession on our heels, there isn’t time or resources to do things the way you’ve always done them, so looking at what you already have available to you could be the key to your success.
2. Communicate to Your Stakeholders