Fundraising Overview

Let’s start with the big fundraising picture overview, or as I like to call it, the 30,000-foot view. Nationally, fundraisers by schools and other non-profit organizations were responsible for more than $5 billion in revenue in 2004, not including capital campaigns. Overall, charitable giving topped $125 billion.

While that seems like a lot, retail sales exceeded $4 trillion in 2004. The consumption portion of spending by businesses and consumers within the Gross Domestic Product (GDP) exceeded $2.5 trillion. Obviously, fundraising is a drop in a bucket compared to the ocean of economic activity in the United States.

What if your fundraiser could tap a bigger portion of that economic activity?

Why shouldn’t it? We’ll start that process by examining the nature of fundraising.

What is a fundraiser?

A fundraiser is a coordinated group effort to solicit supplemental funding from the community, usually in exchange for something of value.

The four main types of fundraisers

  1. Direct sales of products with immediate delivery
  2. Direct sales of products with delayed delivery
  3. Special event fundraisers
  4. Donation solicitation

Direct sales with immediate delivery

This is a one-stop type of fundraiser with all sales being “cash and carry.” Product is distributed to all participants ahead of time and sales are concluded on the spot. The variety of products is necessarily limited to what’s easily carried and what’s easy to sell.

Net proceeds must take into account the cost of unsold returns from individual participants. Many items come in case quantities and partial returns are not accepted.

Direct sales with delayed delivery

This is a “two-stop” (or sometimes more) fundraiser with sales being booked from a brochure or catalog. It involves more work for the organizers, but usually much larger revenue is generated.

Product is delivered several weeks after the order is placed and payment for it is received. There are a tremendous variety of product offerings available. Risk is minimal because all sales are pre-paid.

Special events fundraising

These are usually short term programs involving a theme, a sponsor, a carnival, a raffle, a car wash, a bake sale, etc. Often simple in what they offer, they are very effective for smaller needs.

They can also be more elaborate, sometimes including a combination of special events into one night or weekend. Wild and crazy ideas will often stimulate higher participation.

Soliciting donations

Here there is nothing to sell but the needs and the cause of the organization. Such funding requests are usually most effective if made in person or to a select group of supporters.

The most successful capital campaigns focus on the upper strata of the giving pyramid, individuals who can give amounts larger than the annual salaries of 98% of the population.

Smaller pledge amounts are solicited through direct contact, direct mail, e-mail, newsletters, publicity, or telethons.

Don’t forget Internet fundraising

Having a web site that generates funds for you by participating with on-line shopping affiliate programs is the Internet age way to raise funds.

This type of fundraising often involves receiving rebates or getting back a percentage of revenue from your supplier.

They can also involve ongoing catalog sales or running a store from your web site with drop shipments from a supplier.