The challenges for small charities in Fundraising

The challenges for small charities in Fundraising

Pauline Broomhead | 21 June 2013

We all remember when grants from trusts and foundations and from the local authority were, for many small charities, the backbone of their income. But that was then and it certainly isn’t now!

Whilst trusts and foundations continue to be a real source of support for the smaller charities, grants from local authority sources have been cut hugely and this means that small charities are now looking to increase their voluntary funding from other sources. 

I remember speaking at a conference way back in 2006, the subject was ‘is fundraising the neglected and abandoned child of the charity sector’.  In those days fundraising, outside of grants from trusts and foundations and local authority sources, was seen as a ‘necessary evil’.  Well now it is just plain necessary! 

Some charities, especially those delivering front line social services, for the first time, are looking to business for corporate support, to local major donors and to the wider community for legacy income, event income and public collections. 

What does this changing landscape mean for them, it means that they are having to gain new skills, invest in new staff, and simply put the Trustees having to invest in the future of fund development.  

As small charities dip their toes into these often unchartered areas the biggest issue they face is ‘catching up’ and at a time when funds are scarce and the need for their services is high, finding the necessary investment it will take to build these income streams. A recent piece of research carried out by the FSI and sponsored by the Institute of Fundraising and the Cabinet Office: UK Small Charity Sector Skills Survey 12/13, investigating the skills gaps within the small charity sector highlighted major donor, corporate, and online fundraising as the three categories identified as those causing most concern for the skills and knowledge needed for delivery.

It is almost ironic that they will need to invest in these fundraising resources when the very reason for exploring new areas of funding is the lack of funding!  Trustees are going to have to be brave, they are going to have to support fund development until it bears fruit, as experienced fundraising charities know fundraising cannot be successfully achieved overnight.  It takes time to build relationships with the right support in all key areas of fundraising. The key elements for success are going to be modest investment, both CEO’s and Trustees understanding that investing in fundraisers will not bring treasure into the coffers overnight.  

When I talk to small charity fundraisers it is the unrealistic goals set that underpin the issues they face.  Good fundraisers will be clear with the CEO and the Board about what is possible, they will develop a robust fundraising strategy and set about developing relationships that will bear fruit in the months and sometimes the years ahead.

Gaining the right skills is also a key issue for smaller charities, with often only one fundraiser in the team or even more often  fundraising is ‘tagged on’ to other roles.  Understanding how to develop a strategy and how to approach each specialist area of fund development is a major hurdle to overcome.  The way we write an application to a trust and foundation is not how we develop a proposal for a local business.  Tailoring our message for different audiences takes real understanding of the different markets and is a crucial skill for the all-round fundraiser.  From the FSI’s recent research it is also clear that smaller charities have little or no funds for training and so getting the skills needed is a real barrier to successful fundraising.

Another key area of concern is often a lack of the necessary networks needed to build local relationships with key influencers and potential supporters.  Often the areas of fundraising that will bear early fruit are resource heavy, events, community fundraising etc.  Securing income from local business, local major donors takes time, relationships must be built and trust gained.  Building the right networks in order to access high return areas of fundraising is crucial. 

So, realistic expectations and targets, having the right skills, the time to grow and networks to build on are crucial to the success of fund development within small charities.  All are achievable, we are in an exciting time when fundraising from voluntary sources has never been more necessary and crucial to the ongoing support of the millions of vulnerable individuals, families, communities and causes both here in the UK and overseas.

Fundraising Day of Small Charity Week aims to provide small charities with an annual turnover under £1.5 million with free fundraising initiatives and competitions to help them raise some much needed funds. For more information see http://smallcharityweek.com/fundraising-day/

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Comments

Carolyn M. Appleton, CFRE, Carolyn M. Appleton, Inc. | 21 June 2013

This is an excellent write-up. I discuss similar issues on my blog (with quite a few visitors from the U.K. and Canada): http://carolynmappleton.wordpress.com/posts/2012-advice-from-carolyn-on-nonprofit-fundraising/. Investing in experienced nonprofit staff (and keeping them for the long term to build and maintain private-sector relationships), is a challenge. Many nonprofit leaders want a quick return on the investment of a salary, but relationship-building takes time. More education is needed broadly speaking. Best wishes from Texas.

Ian Clark, fundraising strategy | 21 June 2013

If smaller charities want to raise funds from the public (eg public collections, major donors, online) a key first step is to register with HMRC to collect Gift Aid. This enables gifts from taxpayers to be increased by 25%. And after a couple of years, HMRC will also provide Small Donations Scheme grants of up to £1,250 a year.

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