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Nonprofits, not-for-profits still need to make money

By Jordi Tejero

Companies must turn a profit to remain in business.

The same principle applies to nonprofit and not-for-profit organizations.

No organization can sustain itself if expenditures are consistently higher than revenue.

As board chairman for a nonprofit – Child Care of Southwest Florida – I am continuously studying the balance sheet. Expenses like salaries, benefits, leases, utilities, insurance and learning materials increase each year. Many businesses would simply raise prices to generate revenue that covers the additional costs. However, as a nonprofit, Child Care of Southwest Florida is committed to fulfilling its mission of providing affordable, high-quality early childhood education.

In April, the Federal Reserve estimated that 200,000 businesses closed as a direct result of the pandemic. A joint study from Candid and the Center for Disaster Philanthropy noted one-third of U.S. nonprofits were at risk of closing within two years because of negative financial impacts from COVID-19.

Child Care of Southwest Florida has not only survived the challenge, but it’s thriving. Its five learning centers are open, instructors are teaching and students are learning. And most importantly, parents are working.

Child care is often the road block that prevents parents from returning to work. That’s why Child Care of Southwest Florida worked so diligently last summer implementing new safety protocols, becoming one of the region’s first child care providers to reopen.

Nonprofits that thrive during the good times as well as rough patches share common characteristics:

  • Strong leadership: The CEO must wholeheartedly believe in the mission. The CFO must treat money like his or her own. Board members must approve policy, but also be the organization’s biggest advocates.
  • Mission-focused: All decisions should help the organization accomplish its mission, which should never change.
  • Community-oriented: Organizations should be built and managed by local residents for local residents.
  • Build for the future: Plan ahead. No one can predict the timing or potential impact of the next pandemic, hurricane or economic downturn, but there is always a challenge on the horizon.

Child Care of Southwest Florida has remained viable for two reasons: (1) It enjoys strong support from philanthropic-minded individuals, businesses and foundations; and (2) It is an accredited education provider with a rich history serving children and families since 1967.

It’s been said that education nonprofits have an easy time fundraising. After all, people love cute children. But they also love the environment, animals and the arts, and they support causes like hunger, homelessness and health care.

What donors truly love, however, is supporting nonprofits that are good stewards of fundraising dollars. There is no better investment than education, and no better way to give children a leg up in this world by giving them a strong education from the get-go. Both of my daughters started their formal education with Child Care of Southwest Florida, and to this day, they still have fond memories of their first teachers. I beam with pride every time I discuss Child Care of Southwest Florida’s impact on my daughters’ lives, and other parents have echoed the same sentiments.

Child Care of Southwest Florida is hoping to offer this tremendous learning opportunity to additional children across Lee and Hendry counties, but it needs support. For more information about the nonprofit’s Primary Needs Scholarship Program, please call 239-278-1002 or visit CCSWFL.org/giving.

About the Author

Jordi Tejero is owner of CRS Technology Consultants and serves on the Board of Directors for Child Care of Southwest Florida.

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