Small charities are increasingly innovating to earn their own income to keep their doors open

Press release | January 2018

Small charities are increasingly innovating to earn their own income to keep their doors open

New research from the Foundation for Social Improvement’s (FSI) Small Charity Index reveals small charities are increasingly moving to enterprising solutions to source the funds they need to meet demand for their services.

Respondents stated their greatest funding increase came from earned income, with 19% of respondents reporting an increase between September and November 2017, and reporting an overall growth of 11% since 2013. But still, many small charities are not exploring this as a source of income.

Data from the Small Charity Index has shown that charities are having to look at earning income as other sources of income have flat lined, 85% of respondents report no change in statutory income and 21% report a decrease in voluntary income. Alongside this, small charities and community groups face an urgent challenge of meeting an increased demand for services, with 63%  reporting an increase within the same period and an overall 123% increase in demand since June 2013.

Pauline Broomhead CBE, CEO of the FSI said,

 “I urge small charity and community group leaders to explore earned income as an opportunity to build sustainability into the financial resources of their not-for-profits. Whilst this won’t be the answer for all small charities and community groups, this type of opportunity should be explored along with voluntary and statutory sources.

At the FSI we truly believe that it is important for all small charities to take a good look at the opportunities they have in income generation. A “mixed income economy” is something we have championed since our inception in 2007 and we still believe that all small charity leaders should look closely at how they can raise the funds to make them sustainable. This doesn’t happen overnight but you can work towards a solid mix of income in a planned and measured way.”

As part of the Department for Digital, Culture, Media & Sport’s (DCMS) heavily subsidised Small Charity Training Programme, training events are taking place across the country, which includes training courses on Developing Your Earned Income – Enterprise Your Mission.

The programme is open to small charities and community groups with an annual income of up to £1 million, which have a local focus within England. For more information on the subsidised support, see www.thefsi.org

The full Small Charity Index report is available to download via the FSI’s website: http://www.thefsi.org/wp-content/uploads/2018/01/Index-Sept-to-Nov17.pdf

-ENDS-

NOTE FOR EDITORS:

For additional information or interview requests please contact – Olivia Lam 020 7324 4653 olivia@thefsi.org

The FSI, Charity Number 1123384, supports the UK’s vibrant small charity sector with free and heavily subsidised training, advocacy and support programmes aimed at building sustainability and knowledge-sharing. www.thefsi.org

Charity members of the FSI have an annual turnover of under £1.5 million and membership is free.

The latest Small Charity Index report published today is a quarterly survey of the UK’s small charity leaders and trustees, which analyses trends in income, service delivery, workforce and governance.

The data gathering and analysis of trends is carried out by the FSI through its membership of over 5,600 distinct small charities with a turnover under £1.5 million.

Total organisations surveyed June 2013 – August 2017 – 1,294

Total organisations surveyed September – November 2017 – 347

Further report findings:

The report also looked at the trends in a small charity’s cyber security. More than a third (35%) report to be concerned about their IT security. The majority (63%) include IT security and data protection in their charity’s risk register, and only 1% of respondents suffered a security breach. However, only 20% have carried out any cyber security awareness raising activities for staff or volunteers.

Four years of Small Charity Index trends data key statistics:

Between June 2013 and November 2017:

  • Total increase for demand for services was 123%
  • Voluntary income increased by 2%
  • Statutory income decreased by 11%
  • Earned income increased by 11%
  • Use of reserves increased by 73%