Direct Marketing - How to Calculate the Cost to Raise a Dollar
Saturday, November 23, 2013
When an organization or an individual throws a fundraising event or runs a charity campaign, it tends to look only at the amount of money the efforts produced. If you run a long-term fundraising campaign or a nonprofit organization, few things are more destructive to your finances than this line of thinking. What fundraisers everywhere need to consider is how much money it cost to raise a single dollar during the event or campaign. Many costs, both overt and hidden, go into throwing a fundraiser. By assessing how much it costs to raise a dollar during an event or campaign, fundraisers can assess how effective their efforts are and save money in the future.
1
Tally the direct costs of your fundraiser or fundraising efforts. Direct costs include anything you buy to throw an event or aid fundraising efforts, including rental space, food, drinks and invitations.
2
Tally up the indirect costs of your fundraising effort. Indirect costs include employee salaries or anything used to compensate fundraiser workers for their time. Work out roughly how many hours employees spent planning, organizing and working on a fundraising effort. Calculate the hourly salary they made and multiply it by the number of hours they worked. Add each employee's net pay together to reach the total amount of money you paid employees for their efforts.
3
Add your direct cost and your indirect costs together. This is the net cost of your fundraiser.
4
Subtract the money you made at a fundraiser or through a fundraising effort from the net cost of your fundraiser. This is the net revenue you made from the event.
5
Divide the net cost of the event by the net revenue. The number you get is how much money it cost to raise a single dollar with your fundraising event or efforts.
Tags:
Direct Marketing, Marketing
1
Tally the direct costs of your fundraiser or fundraising efforts. Direct costs include anything you buy to throw an event or aid fundraising efforts, including rental space, food, drinks and invitations.
2
Tally up the indirect costs of your fundraising effort. Indirect costs include employee salaries or anything used to compensate fundraiser workers for their time. Work out roughly how many hours employees spent planning, organizing and working on a fundraising effort. Calculate the hourly salary they made and multiply it by the number of hours they worked. Add each employee's net pay together to reach the total amount of money you paid employees for their efforts.
3
Add your direct cost and your indirect costs together. This is the net cost of your fundraiser.
4
Subtract the money you made at a fundraiser or through a fundraising effort from the net cost of your fundraiser. This is the net revenue you made from the event.
5
Divide the net cost of the event by the net revenue. The number you get is how much money it cost to raise a single dollar with your fundraising event or efforts.
