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Sunday, 06 July 2014 22:00

Nonprofits find financial stability through creativity

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Above all else, the nonprofit Saugatuck Center for the Arts prioritizes serving its audience a strong product that keeps donors happy and willing to continue funding the organization.

For the lakeshore-based arts and cultural center — and indeed, all nonprofits — its financial stability determines its ability to deliver on its mission of creating a vibrant community through the arts, said executive director Kristin Jass Armstrong.

“[Financial stability is] really continuing to refine your product, understanding what the audience wants to see,” Jass Armstrong told MiBiz.

Saugatuck Center for the Arts’ audience-driven strategy paralleled responses from the handful of Michigan-based arts and cultural organizations in the Nonprofit Finance Fund’s 2014 nonprofit industry survey. In the survey, 91 percent of arts and cultural organizations in the state said they focused their investments last year on developing relevant programming for their targeted audiences.

Across all types of nonprofits, 85 percent of Michigan-based organizations said demand for their programs and services increased last year. Of the 124 nonprofits in the state that responded to the survey, 62 percent said they were not able to meet demand for their services in 2013. That compares to 80 percent of nonprofits nationally that reported an increased demand for programs and 56 percent that were unable to meet demand given their available resources.

The situation is not expected to abate this year in Michigan, as 63 percent of nonprofits said they once again expected the demand for services to surpass their capacity.

As an example of how the Saugatuck Center for the Arts’ programming speaks to its supporters, Jass Armstrong cites the recent screening of the Oscar-winning documentary, 20 Feet from Stardom. Some 210 people came into the center on a Saturday night to view the film — right in the middle of the polar vortex.

In part, the center’s success in showing the film could be attributed to its awards-season buzz and the fact it was not playing anywhere else in West Michigan, Jass Armstrong added.

Not all organizations had the same luck that Saugatuck Center for the Arts did earlier this year as. Goodwill Industries of Greater Grand Rapids Inc. needed to do some quick thinking when donations slowed this past winter.

The organization was down not only in donations, but also in sales, as the heavy snowfall kept people from driving to one of the 18 Goodwill stores in greater Grand Rapids. To get these numbers up, Goodwill held corporate donation drives, placing bins at area companies and making it easier for people to donate goods.

“Our donations are our backbone because without donations, we have nothing to sell,” said Jill Wallace, chief marketing officer for Goodwill of Greater Grand Rapids.

To meet these demands, local and national nonprofits need to take a step back, prioritize and look at how they can address these needs, sources said. Sometimes, the nonprofits have to get creative with their programming and fundraising. At other times, they need to work on convincing donors their causes are worthwhile for their communities.

“Arts and cultural opportunities are seen as things that aren’t as important to fund,” Jass Armstrong said. “It’s hard to make an argument when someone says, ‘I’m switching my giving this year to Kids Food Basket.’ … (That’s) understandable. My argument, however, is that arts and culture are extremely important. They’re not just the icing on the cake. They are a part of the cake itself.”

In the Nonprofit Finance Fund survey, 31 percent of Michigan-based respondents said their nonprofit organizations ended the 2013 fiscal year with a surplus, 38 percent had break-even financials and 30 percent ended with a deficit.

Looking ahead to the current 2014 fiscal year, 22 percent of Michigan respondents expected to end up in the red, while 15 percent said they were unable to predict what the year would bring for their balance sheets.

According to Marcia Rapp, vice president of programs at Grand Rapids Community Foundation, the nonprofits she considers to be “rock stars” focus on more than one goal and work to broaden their reach.

“The rock stars are having multiple impact,” Rapp said. “It helps their bottom line, it helps the people that are doing it, it helps their neighborhood and community.”

She cites Goodwill as an example. The nonprofit not only operates stores and accepts donations from the community, but it also maintains a successful job training program.

According to Wallace, Goodwill placed nearly 1,000 people into employment in 2013. One of the more creative ways it trains individuals is through Blue Spoon, Goodwill’s catering program.

“We try to fit our services to the community we serve and not rely on state and government funding,” Wallace said. “The food service industry is growing, so we are offering more job training.”

In that way, Goodwill is thinking beyond its stores for forms of employment for its clients by looking at community interest and needs to succeed. It is able to do all this while keeping to its mission, which is important to local and national nonprofits, Rapp said.

“That’s a real risk if you don’t stay relevant,” she said. “You have your mission and occasionally you’ll change it after time, but typically, you’re stronger if you have an identified mission and you follow your mission. It’s a bad thing if you do something that has nothing to do with your mission. It confuses donors.”

Half of the Michigan-based organizations responding to the Nonprofit Finance Fund survey said their greatest concern for 2014 was achieving financial sustainability. Fifty-three percent said their financial outlook for this year was “harder than 2013,” while just 10 percent indicated they thought this year would be easier on their finances.

For Saugatuck Center for the Arts, 2014 is about refining the product and programming it already has, especially with its summer children’s camps. This year, the organization has deepened the programming as well as refined it, offering more robust options for children. Additionally, the center is working to grow its audience for its monthly film and lecture series.

“As much as the promotion, it’s got to be the product,” Jass Armstrong said. “Because in West Michigan, especially in the summer, our biggest competition is the weather. … We’re competing against decks and golf courses and cocktails.”

Read 4332 times Last modified on Wednesday, 13 August 2014 10:40

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