Even though it is non-profit, NPOs still need to raise their revenue every year so that they can further their income to support the causes they support. Basically, every NPOs have different methods in raising money. Their sources of income can be from http://22.214.171.124 , donations, sponsorships, products or services sales, etc. Most of NPOs don’t rely on donation. It is quite often for people in general to think that the finance in NPOs come from donation.
However, most of their revenue comes from fees for services as well as product sales. It is easy to take some examples. For a non-profit hospital for example, they sells products to raise their revenue. The products they sell in a gift shop. They also provide medical services in return of fees paid by insurance companies, patients, or governments. In addition, NPOs usually have fundraising programs for episodic and ongoing financial support.
Other sources of revenue in non-profit organizations
Aside from donations, product sales, and paid services, there are also other ways a non-profit organization raise their revenue.
- Charitable contribution from individuals can be considered as the biggest sources for non-profit organizations. More than 70% of the average non-profit organizations receive individual charitable contribution. The rest comes from government and foundation grants, corporate philanthropies, as well as bequests.
- Many NPOs also benefits from their local, state, and federal government. Of course, not all NPOs receive contribution from government. Most setting where government contribute is education and public media. They fund various programs run by NPOs especially the one that aims human service or healthcare.
- Foundations are also one of the most reliable sources of income for most NPOs. It comes from various types and sizes. Receiving grants from foundation benefit the cause that NPOs support. Their grants are significant as well as substantial. They can be family foundations, corporate foundations, or community foundations.
- Another source of NPO’s revenue is corporate philanthropy. This is one of the most important part for non-profits organizations because corporate are usually more trusted by consumers as they prefer to buy from socially responsible companies. More often than not, corporate fund NPO they trust in a long-term. Some corporates also choose specific cause to be fund especially the case which is more connected to them. Corporate partnership or you can also call it as sponsorship is one of the most reliable income for NPOs because there are many kinds of benefits to gain such as additional volunteers.