Like businesses, developing a business plan is essential for running a successful nonprofit. A business plan helps nonprofit founders to ask and think through some pertinent questions that will be useful for the growth of the nonprofit. It’s a road map that guides nonprofits in their journey of putting things together to facilitate their effective operations. In addition, a well-written business plan helps nonprofits pitch their mission to potential donors for fundraising.
It helps facilitates a nonprofit operation for optimal results. Ideally, you should periodically review and update your nonprofit business plan to accommodate changes as they occur. In other words, your nonprofit business plan should be flexible enough to cater to events that would benefit your nonprofit’s development.
What is a Nonprofit Business Plan?
A nonprofit business plan is a blueprint that helps owners of nonprofits to pilot their nonprofits day-to-day effectively. It is the nonprofit’ s operating manual which gives a clear direction to the managers of nonprofits on what to do at any point in time. Plus, it could be dangerous to run a business without an operating guide. A nonprofit business plan enables owners of nonprofit organizations to remain steadfast in achieving their nonprofit causes.
Furthermore, a nonprofit business plan helps managers of nonprofits to exercise due diligence and be methodical in decision-making. It helps to infuse objectivity when evaluating all the available resources that will help to further a nonprofit mission.
What Should be Included in a Nonprofit Business Plan
To produce an effective business plan, there’re critical ingredients you would want to capture in your plan, including your nonprofit vision and mission statement, general market analysis, financial plan, organizational description, and more. Below are the components of a good nonprofit business plan
Vision and Mission Statement
Your nonprofit business plan should have both a vision and mission statement. A mission statement defines your nonprofit’s overall objectives and the approach to achieving them. It’s an action-oriented statement declaring your nonprofit’s purpose to its target community.
On the other hand, a vision statement highlights the intended future position of your nonprofit organization. It’s a section that describes what your nonprofit wants to achieve down the line, typically within a period of 5-10 years.
General Market Analysis
In this section, you should specify how you will research and identify your nonprofit’s community, including donors. In other words, it’s where you outline how you will attract support to your cause, connect to valuable donors, engage your constituents and inspire your community.
Factors to painstakingly cover in this area are:
- The demography of your target audience
- The need of your target audience and how your nonprofit can be a perfect solution to that
- What are your competitors’ strengths and weaknesses
Description of the Organization
This section of the nonprofit business plan covers how your organization is structured and the people involved in its operations. Plus, it highlights your nonprofit’ s management and organizational strategy. Here, you would want to say things about your nonprofit’s board of directors, including their number, qualifications, and responsibilities in the organization.
Here is a section that details the activities needed to carry out an effective fundraising campaign. For instance, it answers questions regarding how you will acquire new donors, create awareness, and deepen community engagement. Of course, every part of your marketing plan must align with your nonprofit mission and vision.
Overview of Operation
This is where you discuss your nonprofit objectives, goals, procedures, and timeline in detail. An operation plan outlines the steps you want to take to realize your nonprofit’s mission. In addition, it enables the employees to think through the tactics to achieve the set goals.
Under this section, you should outline how your nonprofit organization seeks to bring a significant and last change to its target community. Plus, it would help if you defined the framework for developing strategies to reach your mission and how you intend to measure the result. An impact plan is useful in nonprofit organizations because it enables owners of nonprofits to monitor what they do. Put differently, an impact plan explains how you expect your organization’s strategies or campaign to work. It shows the cause and effect between your nonprofit’s strategies and the result you hope to achieve.
This is where you want to outline the various funding options for your nonprofit’s mission. There are various sources of revenue generation for nonprofits, including donations, crowdfunding, grants from government and foundations, a line of credit, and more.
Nonprofits do face cash flow problems during their operations. For example, the Covid 19 pandemic negatively impacted the ability of numerous nonprofits to generate funding to finance their mission, leading to the sudden demise of many.
However, Nonprofits that had a backup financial plan like a line of credit could navigate the trying time effectively. A nonprofit line of credit is a short-term loan that avails nonprofit organizations cash on hand in a period of financial difficulties. In addition, a line of credit can be temporarily used for operating expenses such as covering bills, payroll, or other emergency needs.
Contact Financing Solutions for your nonprofit line of credit. Financing Solutions is a leading company in lending lines of credit to nonprofits and small businesses. Their nonprofit line of credit application process is pretty easy (it takes less than two minutes to fill out) and requires no collateral and no personal guarantees. You can see what you are approved for in minutes and there is no obligation.
The line of credit costs nothing to set up and nothing until utilized used making it a great cash backup plan.