The end of the fiscal year is a critical opportunity for nonprofit organizations to see where they’ve been and plan for where they’re going. It’s a time to reconcile the books, too. Clear visibility into the numbers is the first step toward spending down remaining budgets. Spending those end-of-year dollars productively involves cross-functional collaboration: program officers, IT specifiers, and team culture liaisons in your various departments must work together to fuel next year’s program goals.
To achieve this visibility and collaboration, more and more businesses are turning to eProcurement stores for reliable analytics and business insights.
If you make decisions on behalf of your nonprofit organization, you have both occupational and fiduciary responsibility. Those come with big challenges like inconsistent bookkeeping, unchecked programmatic spending, and unplanned purchases for maintenance, repair, supplies, or IT support. Do you have a clear picture of your assets and your liabilities? How about your equity? What income have you counted this year through dues, grants, donations, or sales? What expenses did you count against that income for salaries, mortgage, rent, fees, permits, or office supplies?
But, your responsibilities also come with rewards like seeing how a properly executed budget can drive results, increase impact, and lead to expanded missions. One of those rewards is utilizing unspent budgets to procure resources now that make the next fiscal year a success. If your nonprofit organization holds an annual conference, maybe that means using this year’s remaining funds to purchase pads, pens, and placards for your panel moderators. If your nonprofit works with youth sports programs, maybe that means purchasing soccer balls, cones, and practice jerseys for this fall’s after school clinics.
The more visibility you have into the numbers—and the opportunities—the more power you have to make important purchases today that can have a big impact tomorrow and in fiscal years to come. eProcurement stores like Amazon Business can help you not only make those purchases on supplies and equipment, but also save you money that you can use to reinvest in your nonprofit organization to fulfill its mission.
According to the National Council of Nonprofits, 97% of nonprofit organizations nationwide have an annual budget of less than $5 million, and 92% operate with less than $1 million. Every dollar counts—and, indeed, every penny counts—as mission-driven organizations impact the future of communities and causes.
“Nonprofit organizations in the United States play a vital role delivering services, strengthening communities, and facilitating civic engagement,” according to the Urban Institute in a 2021 report on the fiscal health of nonprofit organizations, noting their diversity in size, type, revenue sources, and staffing structures. The report goes on to detail that donations are essential, especially for nonprofits with expenses below $500,000, who rely on donors for 30% of their revenue, compared to nonprofits with expenses above $500,000, who rely on donors for 18% of their revenue. For many nonprofits, donations as revenue streams are also tied to economic cycles whose volatility has been exacerbated by recent economic challenges.
One key dimension of that fallout has been nonprofit budgets during the pandemic years of 2020 and 2022, which are universally going through a period of adjustment to new realities and future promises. Shoring up the revenue side over the past three years has been about vigilance for everyone—CEOs, CTOs, CPOs, Founders, Directors of Procurement, Directors of Finance, and even IT Directors. It’s also been about creating some breathing room on the expense side, which means reallocating funds, sunsetting projects, and focusing vital resources.
If you have unspent funds in one or more budgets by the end of the fiscal year, you’re in an enviable position. You’ll be able to make a difference next year, which might be critical to your organization’s future. When every dollar counts, by consolidating your spending on eProcurement stores, you are able to gain insight into purchasing patterns and identify opportunities to buy larger quantities of frequently purchased items.
We immediately have access to whatever is purchased through Amazon Business in a dashboard. So from the donor side, the audit side, the survivor side, and the procurement side, the efficiencies gained by this process are life-changing.
— Elizabeth Disco-Shearer CEO, Disaster Services Corporation
For nonprofit organizations, one unified budget should, ideally, be understandable in one single view showing how much money you started with, where it all went, and how much is left over. When you consolidate your activities into one view, it doesn’t mean you’re being too simplistic. It means you’re being clear-sighted.
With eProcurement stores like Amazon Business, it also means you can pinpoint spending patterns well enough to make important decisions about how to drive cost efficiencies in the future. Have more and more employees who spend most of their hybrid week in the office expressed interest in getting a “standing desk?” Are you thinking about employee retention and how to create added perks at work that can enhance work culture? Do you supply subsidized or free supplies, snacks, or art materials to area schools, and you know you will be working with 20% more of those schools next year? Are your community action groups preparing for seasonal shifts and how best to prepare for heating and cooling needs?
Having visibility in those future needs, paired with visibility into your spending patterns, can help you confidently and easily order in bulk—saving on the items you use the most.
The more visibility you have into the numbers, the more you have over your nonprofit organization’s future. Once you understand the patterns that brought you to your end-of-year status, you can see what the next steps entail—and where they might lead.
eProcurement stores like Amazon Business help you take next steps by identifying opportunities to improve efficiency and transparency, at no extra cost. Efficiency is often a euphemism for reducing costs, but the impact on your operations is the same: for things to turn out better, they have to work better—and you have to get more out of what you put in. Remember those unplanned expenses, sometimes called “tail spend?” Amazon Business can help you realize immediate savings for purchases and procurement by offering you relevant selections from hundreds of thousands of suppliers. Amazon Business can also show you how savings in key categories can have a real impact at the end of the year, not to mention how to help your staff comply with purchasing policies.
Amazon Business offers both customizable and off-the-shelf dashboards that can help you track progress toward goals and generate reports quickly and confidently for impromptu check-ins or an auditor’s meeting at the end of the year. The data you can obtain from these reports is also customizable so you can focus the discussion on member services, cashflow, orders you’ve placed, shipping you’re expecting, and refunds that can help rebalance your budget. Visibility in this sense helps you save time, which you can reinvest in your teams, your programs, your policy discussions, and your development goals.
A thousand (or more) little decisions, transactions, and financial events occur during your fiscal year, which makes the reconciliation process all the more important. Of all the positive qualities reconciliation can achieve, “seamless” is up there in importance along with “accurate.” Digital tools like Amazon Business can help improve the speed and accuracy of end-of-year reckoning with line-item detail on purchases by syncing with the major credit cards you use for your business, not to mention line-item detail on expenses by syncing with major management softwares.
The end of the fiscal year is a big opportunity to reconcile what’s happened and plot a course for what’s to come. Digital procurement tools like Amazon Business can provide visibility into purchases, spend analysis, increasing credit limits, bulk purchasing, and other trends that matter to your bottom line. After all, visibility into your fiscal year is power, and power is agency to make the year ahead a great one.
Originally published on Chronicles of Philanthropy, click here to view.
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