Question

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Robby

I need a good analogy

I run a small non profit. My budget is $500,000. We have 4 people on staff and our salaries are 50% of the budget. A donor doesn't want to donate money to us because he believe the percentage is too high. While I agree this rule works as a rule of thumb, it doesn't work at the extremes. A very very small non profit (if not run by volunteers) has to - by necessity - have salaries as a large percent of the budget.

Can anyone help me find a good analogy to throw that concept into high relief. Such as
"it's always good to limit your salt intake of your diet but if you bring it down too much you will die."
asked on Sunday, Feb 26, 2017 04:03:02 AM by Robby

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Answers

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skips777
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Where does the budget come from? Why do your employees get paid 60 k avg. each? You're apparently profiting from it so it doesn't seem non-profit now does it? Why don't you tell donators that red cross uses 85% of their budget on employees so even large non-profits have employees that profit. This question doesn't really belong here. We usually just address whether ideas or arguments are fallacious.
Dr. Bo might answer with a job application......lol
Hey I'll work for 30k starting salary if you hire amputees that are smart asses.
answered on Sunday, Feb 26, 2017 08:06:43 AM by skips777

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modelerr
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I agree with Skips 777, your ‘question’ seeking a suitable analogy for your NPO staff expenses is probably not appropriate for this forum, which deals with logic and logical fallacy. Sounds to me you’re really looking for a free marketing slogan, though this may be unfair.

Besides, your friend’s contention (& unwillingness to donate) may be well taken. Generally, non-profit administrative salaries should fall well below 50% of total expenses. Reference:
https://www.charitynavigator.org/index.cfm?bay=content.view&cpid=48
How substantially this would be expected to vary based on being a “small” NPO is an open question.

More importantly, I question how much Revenue your firm generates annually, i.e., how much money flows through to the actual beneficiaries of your NPO. For example, if your firm (hypothetically) grosses ~$10MM+ in Revenue annually, with total expenses of $500K you’re doing a great job and donors should line up for blocks (i.e., $9.5MM flowing to beneficiaries). If your total annual Revenue (again, hypothetically) is substantially less than $1.0MM with the same (fixed?) expenses, you should probably find another line of work.


answered on Tuesday, Feb 28, 2017 03:42:45 PM by modelerr

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