US NFPs Struggling with Demand

America’s Not for Profits are struggling to meet fast-climbing demand for services with a new survey finding that 87% of organisations declare ‘the recession has not ended’.

The Nonprofit Finance Fund Survey says America's Not for Profits are expecting 2011 to be another tough year for their organisations and for the people they serve.

The NFF, with the support from the Bank of America Charitable Foundation, surveyed more than 1,900 Not for Profit leaders and found that while there are some signs of hope, many organisations are straining under year-after-year increases in the demand for services.
Here’s a summary of the findings:

2011 will be another tough year for Not for Profits and the people they serve:

• 85% of organisations expect an increase in service demand in 2011; just 46% expect to be able to fully meet this demand.
• This comes on top of years of increases: in 2010, 77% of NFPs saw an increase in demand; in 2009, 71% experienced an increase in demand, and 73% of organisations experienced increased demand in 2008.
• 60% of organisations have three months or less of cash on hand; 10% have none.
• Only 9% expect 2011 to be financially easier for the people they serve.

Yet, the survey found there are signs of hope:

• 44% of NFPs reported ending 2010 with a surplus, a move in the right direction from the 35% who had a surplus in 2009.
• 25% of organisations added to reserve funds in 2010.
• 35% of organisations raised more revenue in 2010 than anticipated.

Rebecca Thomas, vice president of consulting services at NFF, says years of economic uncertainty have forced Not for Profits to adjust to the 'new normal' of scarce resources and increased demand.

Thomas says some of the adjustments are creative and healthy – such as strategic collaborations to improve impact in a community, but other effects – layoffs, people who need services being turned away, organisations operating at a deficit or with no cash, are further compromising the social safety net at a great cost to America.

The survey found that "Lifeline" organisations that provide critical services to people in need are finding it particularly hard to meet the demands in their communities:

• 87% of lifeline organisations saw an increase in demand for services in 2010, compared with 68% of non-lifeline organisations.
• 60% of lifeline organisations increased the number of clients they served in 2010, yet only 43% were able to fully meet the demand for their services.
• Just 37% of lifeline organisations expect be able to fully meet demand in 2011.

Yet despite the challenges, the survey found that Not for Profits are not standing still. Over the past 12 months:

• 55% added or expanded programs or services.
• 49% increased the number of clients served.
• 47% partnered with another organisation to improve or increase services offered.
• 39% reduced annual expenses.
• 36% relied more on volunteers.

Nonprofit Finance Fund (NFF) provides loan financing, access to capital and direct advisory services that build the capacity and the financial health of Not for Profits.

The full survey results can be downloaded at http://nonprofitfinancefund.org/announcements/2011/nonprofit-finance-fund-survey-americas-npos-struggle-to-meet-fast-climbing-demand