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September 15, 2022
Yair Segav is the Non-Profit Vertical Lead, CFO Services at Escalon Business Services. A detailed-oriented leader admired for his outstanding skills in financial forecast, planning, analysis, budgeting and cash management, he has been instrumental in navigating a firm’s financial growth. Prior to joining Escalon, he has advised several firms including Nielsen Social, Kemlink USA Inc., Solomon Schechter High School, RSL Liquidating Trust, Citibabes, Maryland Engineering & Dredging Co., and Oceana Advanced Industries Ltd. He holds a bachelor’s in Accounting and Economy from Tel Aviv University.
As banks and economists warn that the U.S. is barreling into an economic recession, nonprofit organizations face the daunting challenge of navigating business needs while staying true to their mission amid the uncertainty. Many are grappling with the double threat of sagging income and higher demand for services.
In an economic downturn, nonprofit income tends to drop as private contributions decline, government funding dips and earnings from endowment funds, together with their capital market values, plummet. At the same time, the economy puts additional demands on nonprofits’ already strained resources, as clients seek increased help and rates of volunteerism drop.
In response, nonprofits may implement budget cuts for fundraising and day-to-day expenses such as payroll, public outreach and overhead, in an effort to channel every possible penny into client services.
However, outsourcing business services is also a cost-effective way for nonprofits to forge ahead in difficult times while balancing organizational structure and mission.
A Meyer Grantee Back‐Office Survey finds that nonprofits, particularly small ones (with a budget of less than $3 million and a headcount of fewer than 20), frequently struggle to meet their non-core yet essential business functions. This was a common refrain in three areas.
Interestingly, the survey also noted that many nonprofits seek better business service solutions for less-recognized challenges associated with domains such as public relations, communications, marketing and fundraising, and development.
There is no doubt that nonprofits’ income from virtually all sources, including philanthropy, sales of goods and services, grants and investment earnings, are threatened by a faltering economy. Meanwhile, the slump has exacerbated their ongoing need to find cost-effective ways to meet administrative requirements.
Moving to outsourced business services, which combine on-hand expertise and efficient completion of recurring tasks, presents a viable option for nonprofits in a recession and beyond.
Outsourced business services bring additional knowledge and professional resources to your nonprofit and can be scaled to meet its needs. In an era of prolonged economic uncertainty, outsourcing to a trusted provider can alleviate nonprofit leaders’ stress by helping the organization to run lean. In the long term, outsourcing helps NPO leaders to double down on their mission by taking time-consuming administrative tasks off their plate.
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