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Ways for Nonprofits to Survive the Pandemic
Lampe, Joseph
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Ways for Nonprofits to Survive the Pandemic

By: Nancy Huckaba, Vice President and National Nonprofit Practice Leader

The COVID-19 pandemic is impacting nonprofit organizations in previously unthinkable ways, from the inability to carry out core missions while volunteers, board members and employees practice social distancing, to a general lack of engagement.

But perhaps the greatest impact is to these organizations' bottom lines. As the US continues to face record unemployment rates, nonprofit organizations and their services are needed now more than ever. But in this economic downturn, tapping into the usual funding sources to meet increased demand is all but impossible: Donors are less able to open their wallets, foundations are halting their giving, and government grants have faded away.

So as nonprofit needs soar while their funding crashes, what can they do to survive?

Assess your financial situation

Taking a deep dive into your organization’s financial situation is the obvious first step: What cash do you have on hand? Do you have reserves? What are your short-term and long-term expenses? Where can you make immediate cuts?

 The highest expense for nonprofit organizations are staff and rent. Consider making tough decisions on furloughs, voluntary lay-offs or pay reductions in the immediate term. If an employee leaves during the pandemic, find ways to divide his or her work among the remaining employees, saving your organization an additional salary until prosperity returns. This is also a time for organizations to tap into mental health resources in order to step back and look at these issues ethically and objectively.

It is also prudent to analyze your organization’s lease for any grace periods that may be extended by your landlord. If they are willing to reduce or even forego rent during an economic downturn, take it.

 Finally, take a look at your ongoing expenses and determine whether any can be paused during this time. Many vendors are allowing temporary cancellations for a minimal, sometimes zero-dollar fee.

Find ways to partner with like-minded organizations

As you work through a new strategy to continue essential services to those in need, consider finding a nonprofit organization with a similar mission and set up a partnership. The organizations can still work under their individual brand names and recognition, but taking advantage of shared resources may be the best way to reduce expenses, save money, and still reach your target communities. Of course, if it’s successful, this could be an option for your nonprofits to consider moving forward post-pandemic.

Communicate your plans -- and your needs -- to all stakeholders

There is no such thing as over-communication during these unprecedented times. As your executive director and board members work through a financial plan, it is extremely important to keep stakeholders and investors abreast of what’s happening. This also applies to any strategy changes that your organization may implement. If your major donors are aware of how your organization is pivoting, they may be more willing to increase their contributions now particularly if you can identify urgent financial needs.

Keep a focus on your mission

It is important to remember that no matter what path your organization takes moving forward, keeping your mission close to heart is absolutely key. Be sure you and your board members deeply understand what your organization’s key goals are, and let those ultimately guide any new decisions.

Stay positive!

Although this is a very difficult time, it could be worse. Other generations made it through tough times and came out stronger and more focused on what really matters. Keep collectively looking for solutions to problems as they arise and understand that no matter how painful this time may be for you and your organization, this is temporary.

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