Paul Findlay, military veteran and Director of Charities at Oaks Consultancy, discusses why income diversification is more important for charities supporting the military and veteran community than ever before.
Military charities face a unique set of challenges in generating income, and income diversification is now more relevant than ever. We live in uncertain times, with government funding shifts, the complex needs of veterans in the post-conflict era, and public giving impacted by economic pressures, requiring a robust and flexible approach by those charities serving the armed forces.
The importance of income diversification for military charities cannot be overstated. With over 2,200 charities in the UK providing essential support to service members, veterans, and their families, ranging from mental health services and rehabilitation to housing and career transition assistance, fundraising is highly competitive within the sector. As public funding can fluctuate with political cycles and charitable giving may dip during economic downturns, military charities must ensure they are not overly dependent on any single income stream. Diversification helps to stabilise funding, allowing these organisations to maintain and expand their critical services.
The principle of avoiding reliance on a single source of income is especially applicable to military charities. The pandemic and cost of living crisis have shown how reliance on events-based fundraising or individual donors can quickly become unsustainable when circumstances change. However, diversifying income without a strategy or purpose can also lead to a lack of focus and dilute resources.
A strategic approach to diversifying income streams involves aligning with the charity's strengths and understanding its weaknesses. For instance, if a military charity excels in community engagement, it should invest its time and resources into community fundraising. However, it should also ensure that it taps into different aspects of the community, which might include local fundraising events, online donation drives, and partnerships with schools and community groups, each offering a different touchpoint with their supporters and a different opportunity to raise funding.
Similarly, a charity might have a strong track record in securing Trusts & Foundations (T&F) funding. Still, it should work to build a diverse portfolio of T&F partners to avoid over-reliance on a limited number of large grants. This could involve reaching out to smaller local trusts, exploring opportunities with foundations focused on specific areas of veterans' welfare, or branching into new themes such as supporting military families or researching veteran-specific medical conditions.
In the quest for diversification, it's also important for UK military charities to be innovative. They must be ready to test new approaches and respond to sector trends and external factors, such as changes in government veterans' policies or new models of philanthropy. Staying ahead with creative fundraising ideas, like digital campaigns or virtual events, can open new income avenues and engage a broader supporter base.
In addition, it's useful for military charities to have a backup income area which has the potential to grow – a fundraising side-hustle! This might include corporate partnerships that offer both funding and strategic support or entering the social enterprise space to generate income by selling goods and services related to the charity's mission.
A robust fundraising strategy is crucial. It enables military charities to fundraise with purpose: setting clear targets, prioritising suitable income streams, deploying resources effectively, and tracking and reporting on progress. Despite the external challenges we continue to face, a good strategy can offer charities the opportunity to grow their income, and, ultimately, change more lives.
For UK military charities, income diversification is more than a financial safeguard - it's a strategic imperative that ensures they can continue to meet the needs of their beneficiaries, irrespective of the economic landscape. Diversification doesn’t need to be complicated, and it doesn’t need to require lots of additional resources. Concentrate on what you’re good at, but consider a range of activities within that area. Test and learn, but ensure that everything you try has a purpose and feeds back into your overarching strategy.
At Oaks, we are committed to helping charities to diversify their income and achieve long-term financial sustainability through effective fundraising planning. Want to learn more about our services? Get in touch.
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