2025 Nonprofit Outlook: Connecting with Your Community as You Plan for Changing Times

The nonprofit world is facing one of the most uncertain environments in recent memory. Our new political leaders have promised deep cuts in federal spending – in fact, the White House Budget Office just ordered a pause in grants and other federal funding assistance pending further review. In Michigan, similar spending cuts may play out as the GOP now controls the State House of Representatives and Democrats hold the State Senate by a slim majority.

At the same time, if those in need experience cuts to their food, housing assistance or other government benefits, nonprofits that address these areas will surely deal with increased demand for services. And potential changes in the federal tax laws may make charitable giving less advantageous, leaving some potential donors less inclined to gift their money and assets.

For people who run organizations founded and committed to serving others, it is an understandably anxious time. At the Vella Group, we have been giving a lot of thought to how nonprofits should navigate potential disruptions. What is the best way to take stock and prepare for worst-case scenarios so you can keep doing the inspirational work so many benefit from? We’ll cover this topic as a three-part series focused on community, donors and staffing. First up is community – the importance of connecting with the people you serve.

Be Transparent, Show Resolve

Many nonprofits serve vulnerable populations. So, threats to existing programs and services tend to create an even greater sense of unease. To address this, your organization must develop clear messaging that sets the right tone:

• Convey strength and unity – ‘we will weather this storm together.’
• Acknowledge the challenges ahead. Paint a clear picture, showing you recognize what’s at risk if funding is threatened or reduced.
• Reaffirm your commitment to carrying out your mission.
• Offer reassurance, letting your community know your organization will do everything it can to ensure continuation of services.
• But don’t overpromise. It’s important to be realistic and honest about adjustments you may need to make.

Then, it’s all in the delivery. You can alleviate a lot of worry among those you serve when you prepare your board, leadership and staff to share consistent information regularly.

Make It a Conversation

But one-way communication will only get you so far. Your organization can’t make meaningful progress until you initiate conversations with your community to fully understand their changing needs and concerns. These interactions can take place through impromptu discussions or more formal community meetings, virtual Q&A sessions, focus groups or surveys.

No matter how you cultivate ongoing dialog, you’ll get a better sense for how your organization may need to pivot to accommodate funding shortages and changes in demand.

Develop a Plan of Action

Planning for challenging times requires creativity, so be prepared to think outside the box. With valuable community feedback in hand, you’re ready to work with your board of directors and leadership team to develop a plan of action focused on several key considerations:

• New, diversified funding sources, whether it’s a different mix of corporate partners, foundations or high-net-worth individuals, or a donor advised fund (DAF).
• Partnerships or alliances with other like-minded community organizations that will complement your services and fill in gaps to avoid straining your resources.
• A strategic plan that prioritizes and assigns accountability for your proposed actions. This plan should include a communications component – how you will share your actions with key stakeholder groups.
• A donor retention strategy that nurtures and maintains existing funding relationships.
• A fiscally responsible budget that allows you the flexibility to weather future storms.

Need Help?

If your nonprofit is facing challenges, we can help. Contact The Vella Group at info@vellaspg.com for more information.