How to Write a Business Plan for a NonProfit Organization
Do you need a non-profit business plan template for a youth organization? Whether you like it or not, your non-profit organization is a business and therefore needs a business plan like every other business. While it is true that you do not seek to make a profit (NON-profit organization) or capitalize on the latest business trends, but many principles and rules that guide the formation and running of a profit organization, for example, a business plan, are used.
Also, because your nonprofit is viewed as a business, it has to be incorporated before you apply for tax-exemption from the government. A business plan is one of the most critical steps for a non-profit organization.
How can you write a good business plan for your non-profit organization? Before the “how” let us talk about the “what” and “why”.
What is Business Planning for a Non-Profit?
Simply put, a business plan is a formal statement that describes your business, shows the goals of your business and the plans in place to achieve these goals and objectives. A business plan is dynamic, that is, it grows as the business or, in this case, the nonprofit organization grows and expands.
Apart from the plans and means of reaching these goals, it also contains the organizational structure and other relevant information.
Why should you write a business plan for your non-profit since you are not seeking to make money?
For a couple of reasons;
· For Funding
Before any investors will invest funds into your nonprofit, they will ask you for your business plan. If you don’t have one, no investor will take you seriously.
· Proper Management
As your nonprofit organization will most likely have board members, a business plan will ensure that they know the aims and objectives of the nonprofit.
Writing a business plan for your nonprofit helps your company have a sense of direction and organization. The aims of the nonprofit are clear. It will help your organization guide its growth.
Very important. If you decide to apply for a loan, you must present a business plan to the institution before your request will be granted.
So, having seen the “what” and “why”, how can you write a good business plan for your nonprofit organization?
The format that you use for your business plan varies according to the type of audience you are writing to and the duration of the nonprofit organization. Notwithstanding, a good business plan for a nonprofit organization usually contains the following important parts and sections.
- Executive summary
- Organizational Structure
- Products, Programs or Services
- Marketing Plan /Marketing opportunities/ competitive analysis
- Financial Plan
1. Executive Summary
The executive summary is a brief, clear and well put together an overview of the whole business plan. It gives an introduction to the reader to the business plan. For the executive summary, it should show the reader the mission of your nonprofit organization, it should acquaint the reader with the history of your organization, the strengths, and assets of your nonprofit organization.
It should be engaging and interesting to read. The executive summary must show the reader why your organization satisfies a need, backing this up with data from your market analysis. It must show how you will financially back your organization presently and in the future.
2. Organizational Structure
This section should make clear to the reader the manner your nonprofit organization is structured and organized. It should show your management team, describing the team members, their experience, backgrounds, and skills.
Some nonprofits have advisory boards, so if you have one, ensure that you talk about the board. This section should explain and show clearly the different levels of management, financial backers, and other important players.
It should have an organizational chart for easier understanding of the chain of command of the nonprofit. It should contain the plans in place for future staff growth and needs.
3. Marketing Plan
The business plan should show the strength of the marketing plan to reach the customers. It should answer the questions; who are my targeted customers? How are they to be contacted? The marketing plan ought to show the reader the current and future trends in the market and how the organization plans to adapt to these trends. Show also, why your nonprofit is essential to meet the need of your customers.
The marketing plan should contain the Product, the price, place, and means of promotion. Apart from these P’s, it should show how you aim to build loyalty in your customers with the aim of customer retention.
4. Products, Programs, and Services
This provides your reader with details on exactly what your organization aims to do. Show clearly what you provide, the delivery process, where you get your products, and what future developments are planned. Also to be included are any copyrights, trademarks or legal patents your nonprofit has a right to and has protected.
5. Financial Plan
Show the source of your funds, any debts or loans in this section. Also included should be such things as your cash flow statements your income statements and balance sheets. Likewise show salaries to be paid, how excess funds will be distributed and your fundraising plans.
Every reputable organization and business, including nonprofits, require a business plan. So, whether you have a startup nonprofit, a declining nonprofit or any such organization, use the information in this article to write a business plan for a nonprofit.