Friends Schemes: How to make them work

By Amanda Rigali on

131016-Sarah-Gee-photoThis post was written by Sarah Gee, co-founder and Managing Partner at Indigo Ltd.

In the past 10 years, since I started I started consulting, the most regularly repeated mistakes I’ve seen have been around membership schemes. Initially, it was organisations which hadn’t worked out return on investment and were shocked to find they were losing money on a fundraising scheme. It’s very common to forget to budget in staff time, which can be considerable; in my experience, it’s often those who contribute the least in monetary terms who expect the most servicing.

About five years ago, the biggest challenge seemed to be Gift Aid. Ensuring that benefits returned to donors didn’t compromise the terms of the Government scheme had eluded many organisations. Given HMRC can go back four years and reclaim Gift Aid claimed erroneously, this is something that all charities should double-check; such a reclaim might be enough to sink an organisation with tight cashflow.

And now we have all sorts of agencies to convince that our scheme is genuinely philanthropic – including HRMC for VAT, as well as Gift Aid (different departments, which don’t always seem to align in their advice) – and legislation to comply with, including the Data Protection Act and Privacy and Electronic Communications Regulations. The outcome of the Etherington Review and the introduction of the Fundraising Regulator looks certain to bring another layer of compliance to get our heads around – and that’s before the EU’s General Data Protection Regulations have to be put in place.

Something that used to be so simple is now fraught with pitfalls, and you really don’t want to get this wrong. Here are five simple questions to get you thinking:

  • Why do you have a friends scheme?
  • What are you trying to achieve with it?
  • Who are your members?
  • Where might you find new ones?
  • When is the right time to look at higher level giving – and what are the circumstances when you might consider closing the scheme entirely?

We’ll look at all of this, and more, in my upcoming courses in Manchester and London. Friendship, as it is in real life, is often more complicated than you might think!

‘Making Friends in Fundraising’ with Sarah Gee runs in Manchester on Thursday 12 May 2016 and in London on Tuesday 14 June 2016 – click here for full details and online booking.

Posted by Amanda Rigali

Amanda is Director of Strategic Development at Cause4, and Head of the Arts Fundraising & Philanthropy Programme. As well as running the Programme, Amanda runs fundraising training sessions for cultural professionals across England and offers intensive strategy support to a range of charities.

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