An association needs funding to sustain its activity, especially when it regularly organises events. Finding funding then almost becomes a full-time activity. Diversifying your sources of financing is also essential so as not to risk finding yourself suddenly with no cash.
- Dues and membership fees
- Gifts, bequests and donations
- Patronage and sponsorship
- The banks
- Profitable events and activities
Dues and membership fees collected from your association’s members are part of its first financing resources. It is possible to increase them over time in order to be able to invest in projects. It is important to ensure that contributors are informed in advance, and that they understand what their money is being used for. Organising an information meeting or sending an explanatory email will allow you to involve them in your projects. They will then be in a better position to contribute because they want to and not because they have to. You can also demonstrate that you are making efforts to obtain funding through other means — grant applications, event organisation, etc. In this way, you make them understand that your objective is not to take their money, but to improve the services provided by the association. Another thing to pay attention to is amending the association’s statutes and regulations.
Please note that contributions are in no way a reserve fund for your cash flow. They must correspond to specific expenses that are included in your annual budget.
Gifts, bequests, and donations, whether material or financial, can be made by individuals or companies. Generally, they are welcome to start an association. Gifts and bequests sometimes happen at unpredictable times, while donations can be collected thanks to a communication campaign and a specific event.
To encourage donations, make it clear to potential donors that their action will result in a deduction on their income tax.
Subsidies are public grants allocated to associations that carry out projects of general interest. They include all types of aid granted by the State, public institutions, local authorities, social security bodies, or government organisations.
If a grant is for a specific expense, the association must be accountable to the government or organisation that awarded the grant. It then provides it with a financial report that shows the compliance of the expenses incurred. It must be sent within 6 months after the end of the fiscal year for which the grant was awarded.
For more information, go to www.gov.uk.
Contact people interested in your association’s mission to ask them to be its patron or sponsor.
Patronage is very interesting, both for the association and for the patron. This is called a win-win action. Indeed, you collect money without having to pay anything in return; the patron benefits from tax breaks and a rewarding image.
Sponsorship is intended to promote the image of the sponsor. You will therefore have to provide the sponsor with visibility in a specific place, on your website, or on official documents.
Contrary to what we think, an association may request an exceptional overdraft permit if it needs it to regulate its cash flow. It can also take out a bank loan or an equipment or property finance lease.
Crowdfunding makes it possible to test the attractiveness of a project by requesting funds before it starts. If the funds raised are sufficient, the project will be launched and you will leave with more cash flow than if you started from scratch.
For the crowdfunding campaign to be successful, you already need a fairly large network of contacts, including people who will be ready to participate quickly. The objective is then to create a chain reaction to convince people outside your network of the quality of your project. Generally, rewards are offered to participants: goodies, first goods produced, etc.
Organise profitable events and activities that will allow you to finance your association’s projects. “Profitable” or “lucrative” does not mean that the money goes into your pocket. This means that you sell products and collect money, but it must be reinvested. It is a legal requirement.
Thus, you can organise:
- sales of cakes or goodies — t‑shirts, water bottles, caps;
- service days — car cleaning, Christmas gift wrapping;
- events related to your mission.…
The possibilities are endless… it’s up to you to find the right solution! Let your creativity take over and be careful because most of these activities require a minimum of cash flow upstream.
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