COVID-19 Impact on Non-Profits

A Look at the Early Data

The early research about non-profits and the pandemic shows a sector in crisis, with a potential silver lining.

Finding that silver lining means steering away from questions like “When can we get back to normal?” and instead focusing on questions such as “How do we engage with our mission given the challenges of the moment?” and, “How do we help our supporters help us?”

Let’s start with the data.

A Charities Aid Foundation of America survey of non-profits in late March found that:

• Two-thirds of non-profits are already experiencing a drop in contributions, and
• One-third of non-profits surveyed reported increased operating costs.

A Fidelity Charity survey of donors and volunteers found that:

• Nearly half of recent volunteers expected to decrease or stop their volunteer activities because of the pandemic; rising to six in ten among older volunteers.
• About one in five donors expect to decrease their charitable giving as a result of the pandemic, primarily due to their own economic situation.

At the same time, the Fidelity Charity survey reveals deep concern and commitment to non-profits among donors and volunteers:

• Eight in ten donors are concerned about non-profits’ ability to operate, and as many indicate they will maintain (54%) or even increase (25%) their giving this year.

The data so far is limited, but taken together, they suggest that while the spirit may be willing, the flesh (and the pocketbook) may be nervous. Many non-profits are likely to face challenges with both fundraising and volunteerism for the foreseeable future.

Unfortunately, for some non-profits, a disruption in fundraising and volunteers has coincided with a massive increase in the need for services. Consider food banks, which are facing unprecedented demand, but are also operating sometimes with reduced manpower and always with the complications of social distancing.

Other organizations, such as arts and cultural organizations, have seen sudden drops in revenue due to the shuttering of operations. Just the week, the Guthrie, one of the nation’s top regional theatres, announced that it was cutting 75% of its staff. Others are sure to follow.

Across the board, fundraisers—which can account for a significant percentage of annual revenue—have been canceled or moved online, with no sense of when such face-to-face gatherings may once again be done safely.

When feeling besieged, it is tempting to hunker down and wait out the storm, and the Coronavirus pandemic looks to be the storm of a lifetime. But we believe that hunkering down is a strategic mistake, particularly for non-profit organizations.

The best way to prepare for an unknown future is to focus on the present, and that means having the kind of information that allows for the best decision at this time. As the data suggests, despite the decline in contributions and volunteerism, there is significant public spirit that can be tapped into right now.

We believe non-profits that are able to adjust to the times and meet the needs and mood of the public may be able to not only weather the initial storm, but also emerge renewed and even strengthened.

Food banks may have been hit hard, but we see signs of rallying around the need. Supermarket chain Publix has started buying food from producers that was originally earmarked for shuttered schools and restaurants and re-directing it to charities.

The food chain is transforming in other ways. For example, Community Supported Agriculture (CSA) has seen a significant membership spike as people value the ability to buy fresh food directly from producers, rather than face grocery stores.

According to the Fidelity Charity survey, while donors remain committed to supporting the causes they care about, many also say that they are uncertain how best to direct their support in light of the pandemic.

Understanding what kind of programs, activities, and messaging may resonate with and mobilize its supporter base can keep the organization connected to its donors and volunteers and help see it through these initial months of crisis and beyond.

The next phase will be about adjustment. We are undoubtedly looking at a changed world, and this means figuring out how to speak to the needs and values of this “new normal.” But waiting for the new normal to fully emerge means waiting too long.

At Willow, we’re interested in helping non-profits survive the crisis and thrive in its aftermath because this period has revealed how important institutions and organizations that bind us together truly are.

If you have questions that need answers, or aren’t even sure yet what questions you should be asking, please contact us. We’re here to help.

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