Understanding the Budget Cycle

A key component of fundraising is understanding when money is available. Increase your odds of hitting your fundraising goals by understanding the budget cycle and how it impacts yourability to hit your funding targets.

Episode 147 | Understanding the Budget Cycle

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Inland Empire Black Worker Center Pt. 3

👉🏿https://www.iebwc.org

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Got Questions? "Ask Amber" on any of my social media platforms or email me at [email protected]

Speaker 1 (00:00):

The number one mistake nonprofits make when determining which fundraiser that they're going to do and when they're going to do it is to randomly pick a date. If you are planning your fundraiser, the number one thing you want to do before you do that is to understand the budget cycle. And this episode we're going to talk about how to meet your fundraising goals by understanding the budget cycle.

Speaker 2 (00:26):

Welcome to On Air with Amber Wynn, where nonprofit leaders learn to fuse passion and commitment with proven business strategies to create long-term funding impact and sustainability. And now here's your host and resident, Phil entrepreneur, Amber Wynn.

Speaker 1 (00:49):

What is the budget cycle? A budget cycle is really important to a nonprofit, especially if you are generating your revenue through fundraisers. The budget cycle is basically the time of the year or the time of the quarter when a company has decided when they're going to fund their activities. So for a corporation, it's generally going to happen in the fall for government agencies, foundations, it typically happens in the summer like around June or July and then again in September when nonprofits decide that they're going to have fundraisers and they don't align them with the budget cycle, here's what happens. You get scraps. You want to be sure to understand the budget cycle of your funders so that you can make sure that you can get the most amount possible. When we come back, I'm going to dive a little bit deeper into what that is, what that means, and how you should strategically position yourself to be able to get as much money as you can around your fundraisers. When we come back,

(02:01):

A nonprofit is a business governed by agencies on the local, state, and federal levels authorized to revoke a nonprofits tax exempt status for non-compliance. Don't put your funding in jeopardy. Get the nonprofit compliance checklist to make sure you don't forget to file required forms to the agencies that can derail your operations for months. Compliance is 50% of a nonprofit's funding strategy. Getting the grant is half the work, but keeping it and getting it renewed is the other half. Don't spend hours writing grants only to have them rejected because your tax exempt status has been revoked. Keep your organization active and in good standing. Order your copy today. So before we went to commercial, I was talking to you about the budget cycle. The budget cycle is extremely important to nonprofits. I can't tell you how many times people will say to me, oh, Amber, we're going to have a gala.

(02:53):

And I'm like, when? Next year? They're like, no, in the fall it'll be the spring, right? And I'll say, that is the worst thing that you can do. And they're like, what are you talking about? And I'll say to them, you need to understand that the money that you're going to get in the fall is going to be pennies because corporations make their budgets in the fall. And so you may think, oh, well then that's the perfect timing. No, you need to get into that budget the year before, right? Understanding budget cycles will help you to strategically generate more revenue. A lot of times people will be like, oh, we're going to have our 10th gala to celebrate our anniversary, like we started our organization in August. Well, August is not the most prime time for you to have a gala unless you understand that you needed to reach out to these funders August of the previous year.

(03:49):

So people think, oh yeah, we're going to make all of this money. You need to go into your fundraisers understanding that in order for it to be successful, you have commitments before you even send out one invitation. And in order to get those commitments, you need to know when to ask. If you're asking in the fall of the same year of your fundraiser, there's a high likelihood, unless you know somebody that's on that financial planning committee that you're not going to get a lot of money. If your budgets are like $250,000, $300,000 and you're reaching out for support from companies who've already planned their fiscal year, their budget cycles already been set, you're not going to get a lot of money. So if you're like, yeah, we're going to do it on the same month of our anniversary, then just be sure that you get into that budget cycle the previous year.

(04:43):

Otherwise, your fundraisers are going to be a bust. So it's just important when you're planning your fundraisers that you understand the importance of a budget cycle. Alright, when we come back, we get to hear your questions with Ask Amber. So when we return, ask Amber, have you been duped by a grant writer promising you the moon and the stars? But after collecting your $2,000, you never win a grant? No. A grant writer can't guarantee you'll get funded, but if you don't know how to vet them, you could walk right into a scam. Check out my guide the questions to ask a grant writer before you hire them to help you determine if a grant writer is a bonafide professional or out to steal your hard earned money with no intentions of yielding results. This guide explains what to look for in a grant writer if they're novice or seasoned, if they're a fit for the type of proposal you need written, what questions they should ask you. Leverage my 25 years of grant writing experience securing over $10 million in grants for clients to help you find a qualified grant writer and reduce your chances of getting scammed. Order your copy today. Welcome back. You're on air with Amber Wynn. It's your girl, and today we're talking about understanding the budget cycle. Right now in the episode, it is your time to ask me your most pressing questions. Our question today comes from June from Florida, and she's asking me about the development director. All right, so let's hear what June has to ask.

Speaker 3 (06:17):

Hello, Amber. I need you to settle a disagreement between me and my development director. Oh, hi. This is June hailing from sunny Florida, by the way. So I believe that she's making me do her job, asking me to do things like create funding goals and identify the organization's impact, and asking me what our greatest challenges are. In my opinion, that's what I'm paying her for. She says, it's my job to provide her with these things in order for her to do her job. What are your thoughts?

Speaker 1 (06:45):

Well, June, unfortunately, I have to say I am on the side of your development director. Listen, when you hire a development director, you are hiring them to create the strategy, but they can't create the strategy without your insight knowledge of the organization. So yes, they are going to ask you for things like what is the impact of your organization? They're going to ask you what the biggest challenges are. They're going to ask you to identify those things that you want supported. You are the subject matter expert. You started the organization or you've been running the organization a lot of times, which is why I covered this. I think back in episode 1 38. A lot of times people hire development directors without understanding what their role and responsibilities are. Their role and responsibilities are to craft some type of strategy, but you have to give them the foundational information.

(07:46):

You have to let them know, Hey, we're going to focus on capacity building, or Hey, we're going to focus on systems. They take that information and then they build the case for support. So June, you think that she's supposed to do all of this. She can't, can't pull it out of the side of her neck. She needs to have direction from you. As the subject matter expert, I am so sorry if this disappoints you, but for all of those executive directors out there, hiring development directors, the main responsibility of your development director is to nurture relationships. It takes anywhere between six months to a year for a development director to close on a major donor, right? It takes anywhere between three months to six months for them to craft a very solid individual donor campaign. You guys hire these development directors like you're hiring grant writers, and you expect a change to happen in 30 days.

(08:42):

It's not how it works. So if you are working with a development director, I'm going to encourage you to be patient and to give them the information that they're requesting so that they can do their job. All right. So that was Ask Amber, if you have a question for me, you can hit me up on any of my socials and ask me your question and I'll be happy to read it here on air. Now we're moving to my favorite part of the episode when I get to shine a light on the nonprofit leaders doing the work in the community. Mostly I shine it because nonprofit leaders are doing the work, but I really want my funders out there to see all of the amazing work that our community is doing. We are on part three of my conversation with Dr. Thomas of the Inland Empire Worker Center, and he's breaking down some of the challenges that he's experiencing with the unions and some of the solutions that they're creating, working in partnership with them. So let's take a look at part three of my conversation with Dr. Thomas.

Speaker 4 (09:54):

So what we are trying to do is remove what we call the bachelor barrier. We want people to get from unemployed, untrained, underemployed, to a family sustaining income as quickly as possible. So that's our claim to fame, that's our goal. That's what we are trying to do. We don't want to give them more credentials than they need. We want them to stay in school an hour longer than they need to. We're just going to get them from A to B with the necessary equipment to get to the family sustaining work as soon as possible. And oftentimes that means getting in through the entry level points. And that's okay because if there's a path upward or trajectory forward, they can certainly engage that when the time comes. So that's kind of what we're trying to do,

Speaker 1 (11:07):

And we're back and you're on air with Amber Wynn. If you want to hear more of my conversation with Dr. Thomas of the Inland Empire Worker Center, come and check me out over there on my YouTube channel. If not, we have one more episode. You can join me next week when we wrap up our conversation with Dr. Thomas. Today, we have been talking about understanding the budget cycle, understanding when funders are deciding when to give out money. That is important if you are going to be asking funders, and you should be corporate sponsors, major donors, individual donors, knowing when they are creating their budget is the key for you to be able to hit your mark with your fundraising event. Thank you so much for joining. If you heard anything today that you think might help someone in your community, be sure to share. Be sure to like and subscribe, and be sure to join me next week on Air with Amber. But most importantly, be sure to take care of yourself like you take care of your community. See you next

Speaker 2 (12:11):

Week. Thanks for listening. If you enjoyed this episode, subscribe and leave a review on iTunes. Head over to www.amberwin.net/podcast for the links and resources mentioned in today's podcast. See you next time.