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It is important for non profit organizations, both those just starting out and those which are well established, to have a diversified stream of income. By diversifying where your revenue is coming from your non profit organization will be less dependent on each revenue source. The more diverse your organization is the better it will be able to withstand changes in funding.

Non profit grants for example are a great way for organizations to generate the revenue which they need to operate. However, if an organization is relying too heavily on grants and their non profit funding gets pulled or reduced, the organization may struggle trying to make up for that loss of funding in other ways. It is better to be prepared by having additional fundraising initiatives, and soliciting donations in addition to applying for grants.

When soliciting for a non profit grant from either a government agency or private organization, you will need to create a non profit grant proposal. The grant proposal will introduce your organization to the positional funding source, give them a clear understanding of your organization’s purpose and give a decryption of your organization’s planned programs and specific objectives. It will also provide a clear description of your organization’s purposed budget, your specific qualifications, and a conclusion wrapping up all of the information

The need for multiple sources of non profit funding has become even more important with the recent decline in the American economy. As bank accounts continue to shrink; individuals, organizations and foundations are becoming more selective over which organizations they are making contributions to. This is creating more competition between organizations for the resources available. The organizations which are best equipped to deal with this competition are those which are the most diverse in their revenue sources and the least reliant on one single source.

Organizations should look at fundraising as another non profit funding source.  Fundraising is a way of marketing and getting your name out into the community in addition to means of generating revenue for your organization. Fundraising events, while they may not always create a large amount of income for an organization cannot always be measured by the amount of money they generate at that event. This is due to the possibility of future donations and contributions based on the relationship which may have been established at one of these events.

Some of the best organizational fundraising events are based around the organization’s mission.  By organizing a fundraiser that relates to the mission of your organization you will also be bringing awareness to your cause. You will be able to discuss and point out the need for your organization and what exactly it is you are trying to do and how you are trying to help. Fundraisers can also be productive in terms other than purely the amount of funding generated. Other ways fundraisers can be successful would be by creating interest and support from individuals who will continue to be active in our organization after the fundraiser has concluded. This could be through continued volunteering or supporting our organization at future fundraisers, or simply thru positive word of mouth from these individuals.

Hiring a professional fundraiser or grant writer can be a smart move for event the youngest of non profit organizations.  Not only does a professional have experience working a variety of different events and writing a number of proposals, a professional knows how to make connections and seek out the best options for the organization.

Even non profit organizations which have been successful over a period of time using one revenue source should consider working to find new untapped sources of income when strategizing their non profit funding efforts. This will strengthen any organization and all organizations will welcome more income; as more income allows the organization more freedom in working towards accomplishing their mission and fulfilling their goal.

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Many non-profits do not take the time to hash out an estimated budget for their programs before embarking on the grant proposal process. However, establishing a budget is an essential step in the operation of every organization, regardless of whether or not they are seeking grant funding. Without conducting some research regarding costs and making financial calculations, a non-profit cannot accurately determine how much money they need in order to achieve their goals, and therefore do not know the amount of funding they should request from foundations.

Fortunately, The Foundation Center offers a free online Proposal Budgeting Basics course:

“This online course is designed to help with the basics of developing a project budget, and it is geared for those who have general knowledge of proposal development. (Beginners might want to take the Proposal Writing Short Course.) When you complete this course, you will know:

• The basic components of a project budget
• Different types of financial documents often required for proposals
• How overhead costs and fringe benefits may be incorporated within the budget
• How to access resources on the Web, which provide templates of project budgets”

You do not need an accountant to prepare your non-profit organization’s budget; however, if you have little knowledge about project budgeting, hiring an accountant can be useful the first time around. 

Here are a few additional resources that will aid in preparing your organization’s budget:

• Nonprofit Guides provides a sample budget, proposal cover letter, letter of inquiry, proposal, and other helpful examples.
• The Cleveland Foundation’s website offers a Grantee Toolkit including sample templates for a project budget request.
• Register on the CharityNet USA website and gain access to a variety of free non-profit tools and resources.