As technology helps nonprofit organizations to streamline processes, it calls many of the longstanding processes into question. Large donors will almost always ask nonprofits for a copy of their business plan because they want to know what nonprofits are doing and how they plan to accomplish their goals. That’s really not a lot to expect from an organization that’s interested in supporting your cause.
This is an important reason for board directors to take their business plan seriously and not just dismiss it as an outdated process that takes up valuable board time. The business plan outlines who you are, what you do, where you do it and how your organization makes a positive impact. A nonprofit business plan also includes your goals and your action plan for achieving them. Nonprofit boards should consider it a living document and update it frequently.
It’s helpful to begin with a nonprofit business plan template, but there’s no set length for the number of pages that a business plan should be. Keep it as concise as possible while making it long enough to include all the information your donors want to know.
Following is a sample of a nonprofit business plan template:
Nonprofit Business Plan Template
Name of Nonprofit:
Table of Contents (include page numbers)
Your executive summary page should come immediately after your table of contents. It should include a short description of your mission and vision. It should tell a bit about the nonprofit’s history and how your nonprofit meets the needs of the community. Write the summary in a tone and voice that captures your reader’s attention and motivates them to keep reading.
Products, Programs and Services
Use this section to highlight the products and/or services that your nonprofit offers. You may choose to add a short description of the programs you currently offer and the ones you hope to offer in the future. This is a great place to add some illustrations or photos of your nonprofit in action to give it a personal feel and help your donations feel connected to it. Expand on it by describing the positive impact that your program makes. Make a deeper impact by adding details about how your fund programs and the benefits they provide.
Your nonprofit may have an extensive marketing plan. You don’t have to include the entire marketing plan in your business plan, but include a brief version of it here. Add these four sections to your marketing plan description: marketing research, constituency, competitors and collaborators, and strategy.
This is the place to explain your niche. Include research that’s been published by others as well as any research that your own organization has done. Identify your target population or beneficiaries, including their characteristics, needs and locations. Outline the demographics of those you serve by including details about age, gender, location, income, occupation, education and any other important details. Add information about how your organization improves the lives of these individuals. Include some details about who your organization’s competitors and collaborators are. Make your nonprofit stand out, as donors may have been asked to support your competitors as well. Include information that describes your promotions, advertising, budgeting and marketing methods at various growth stages. You might decide to include details of some of your more successful marketing campaigns.
In this section, describe what your nonprofit looks like on a daily basis. Paint a picture of your employees, processes, locations, etc. Describe where your employees work. Outline your governing and leadership structure, including the board, consultants and advisors. List your permits, licenses, insurance coverage, trademarks, patents and copyrights. Add a section that describes your staff, along with their roles and responsibilities. Include the number of employees, type of employees, pay structure, and whether you use contractors or freelancers. Explain whether you will need to hire new staff and when you’re projected to start hiring.
Describe your nonprofit’s plan to achieve your mission and vision. This is the place to talk about your goals in a meaningful way and relate them to the kind of change your organization hopes to make. Donors will also be interested in knowing how you plan to measure the impact of your efforts.
Your donors are aware that it will be difficult to manage your finances without a financial plan. They’re not looking for a guarantee here They just want to know that you do have a plan. This is the place to include a summary of your past financial picture and what you hope that your future financial picture will be. Add reports such as cash flow statements, balance sheets, income statements and your budget. Include a list of your revenue streams, including partners, sponsors, donors, grants, subscriptions, membership fees and fundraising events. In addition, be sure to list your nonprofit’s debts and income, including bonds, holdings and endowments.
Include what you believe to be some of the most important documents that you think your donors may be interested in. Don’t overdo it by adding every document you can find. The types of documents you might add to your appendix include:
- Resumes of key staff
- Board member lists
- Promotional flyers
- Strategic plan
- Mission and vision statements
- A copy of your annual report
- Letters of endorsement
- Copies of market research
- Diagrams of operational or financial structures
- Current fiscal year budget
- List of the board of directors
- A copy of your IRS status letter
- Balance sheets
- Organizational flow chart
If you’re using a BoardEffect board management system, all of these documents will be easily searchable by doing a simple search.
A nonprofit business plan will help you to better understand your beneficiaries, partners and other stakeholders. Writing your business plan will also help boards to assess the feasibility of their fundraising and finance models.
In the process, you may discover research that helps to uncover new opportunities and helps you to attract new board directors and volunteers, and that is a worthwhile benefit in itself.