Nonprofits Taking Steps to Adapt to 'New Normal', Survey Finds

Nonprofits Taking Steps to Adapt to 'New Normal', Survey Finds

After years of economic stress, many nonprofit organizations are changing the way they do business in order to adapt to new economic realities, a report from the finds.

According to NFF's (15 pages, PDF), 49 percent of the 5,983 nonprofits that responded to the survey said they have added or expanded their programs or services, while 17 percent have reduced or eliminated programs or services; 39 percent have collaborated with another organization to improve or expand services; 39 percent have upgraded technology to improve organizational efficiency; and 36 percent have engaged more closely with their boards.

Sponsored by the , the survey also found that organizations dependent on public-sector funding face particular challenges, with only 14 percent of the nonprofits that receive state and local funding reporting they were paid for the full cost of services and just 17 percent of federal fund recipients receiving full reimbursement. Moreover, even when government does reimburse nonprofits in full for services rendered, it is often late to pay. According to the survey, more than 60 percent of nonprofits receiving state or local funds reported overdue payments, while more than 50 percent who receive funds from the federal government reported late payments.

As challenging economic conditions persist, many organizations are finding it difficult to meet the growing demand for services in their communities. Indeed, for the first time in five years, a majority of survey respondents (52 percent) said they were unable to meet demand over the last year, compared to fewer than half (44 percent) in the 2009 survey. The survey also found that more than four in ten respondents (42 percent) said they do not have the right mix of financial resources to thrive and be effective over the next three years; that one in four (25 percent) have thirty days or less of cash on hand; that more than a third (39 percent) plan to change the way they raise and spend money over the next year; and that more than a fifth (23 percent) hope to broaden their revenue streams beyond grants and/or contracts to include things like loans and investments.

"Nonprofits are changing the way they do business because they have to: government funding is not returning to pre-recession levels, philanthropic dollars are limited, and demand for critical services has climbed dramatically," said Continue indulged speaking CEO Antony Bugg-Levine. "At the same time, 56 percent of nonprofits plan to increase the number of people served. That goal requires change and innovation — for nonprofits, for those who fund them, and for the broader systems we need to preserve and expand economic opportunity and social progress."

"." Continue indulged speaking Press Release 03/25/2013.