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Formula for Cost to Raise a Dollar

Last post 06-25-2007 4:52 PM by Melissa Graves. 8 replies.
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  • 06-05-2007 12:50 PM

    Formula for Cost to Raise a Dollar

    I am looking for the formula for the cost to raise a dollar. I thought it was expenses, divided by gross income, x 100... but that seems weird. Example, if my expenses were 5k and my income was 100k... then it costs me five cents to raise a dollar... is that right?
  • 06-05-2007 1:10 PM In reply to

    • Melissa Graves
    • Top 10 Contributor
    • User Since: 2002
    • Posts 1,153
    • Organization: Village for Families and Children
    • Products:  The Raiser's Edge

    Formula for Cost to Raise a Dollar

    That's the right calculation and if those are truly your only expenses then you did very well. What type of appeal was this? Melissa S. Graves Director of Development Services The Village for Families and Children mgraves (at) villageforchildren.org www.villageforchildren.org GET ON THE BUS! Check out what the Blackbaud User Society is talking about today at www.blackbus.org!
    Melissa S. Graves
    Annual Fund Database Manager
    Pathfinder International
  • 06-05-2007 1:39 PM In reply to

    • Belinda Goodman
    • Top 150 Contributor
    • User Since: 0807
    • Posts 51
    • Organization: Louisiana College
    • Products:  Accounting for Nonprofits, The Raiser's Edge

    Formula for Cost to Raise a Dollar

    The expense divided by the gross looks right. The x 100 changes your decimal (and to me can be confusing). As long as you know that you are talking about cents and not dollars. 5 cents for your example is correct. But say you went into the negative and you divided 5000 (expenses) by 4500 (gross received) and multiplied by 100, it would come out 111.111 etc. and that would not be $111.11; it would cost you $1.11 for every $1 you received. Another words, you are correct as long as you are looking at it the right way. I would leave off the X100 (personally) Thank you, Belinda Goodman Institutional Advancement and Alumni [i]--- Edited at 6/5/2007 1:40:39 PM by Belinda[/i] [i]--- Edited at 6/5/2007 1:41:16 PM by Belinda[/i] [i]--- Edited at 6/5/2007 1:42:55 PM by Belinda[/i]
  • 06-11-2007 4:52 PM In reply to

    Formula for Cost to Raise a Dollar

    It's 1 divided by (income divided by cost). 1/(100,000/5,000) 1/20 .05 That was a great cost for the program :)
  • 06-19-2007 2:36 PM In reply to

    Formula for Cost to Raise a Dollar

    Thank you all for your responses. You were very helpful! The figures I gave were an example based on our Associate Giving Campaign which is a direct mail/personal blitz format. Actual figures are more like $160,000 gross, $11,000 expenses = $.07 Thanks again!!
  • 06-20-2007 1:56 PM In reply to

    Formula for Cost to Raise a Dollar

    Dear Heather: If we had that kind of success with Direct mail, we'd do nothing else! Could you tell us more about this campaign? How you did it? How it was so successful? Joanne Butcher Director of Development and Communications Shih Yu-Lang Central YMCA Director of Development and Communications Shih Yu-Lang Central YMCA, San Francisco 415-447-2515
  • 06-20-2007 5:53 PM In reply to

    Formula for Cost to Raise a Dollar

    Heather, I do calculate this in my reports. It works like this: Fall Appeal Letter Donations Received $22,573 Expenses (w/o payroll costs) $2,140 Cost per Dollar donated = 2140/22573 = 0.095 or 9 1/2 cents per each dollar donated. This is a math word problem where 'per' indicates division. So it is the cost divided by donations. For my appeal, that was 2140/22573. When you read about a formula that includes "x100", that indicates that the answer is actually supposed to be a percent. You are not looking for a percent, but rather how much did it cost per dollar to raise the specific amount you actually raised. I hope this helps :) Loretta J Cannon, Database Manager Idaho Youth Ranch [Email Removed]
  • 06-25-2007 2:46 PM In reply to

    Formula for Cost to Raise a Dollar

    This is great information, and new to this development novice. My question is: how do you calculate the appeal response? In May I sent out a package with a marked envelope, and am recording gifts that arrive in that envelope. However, I have also sent one mass and one segmented email, written personal letters, made phone calls, and have volunteers also emailing and phoning. Gifts come in over the web and in a variety of different envelopes, some from packages sent out in Feb or March. How do I assign a specific return amount to the specific May package?
  • 06-25-2007 4:52 PM In reply to

    • Melissa Graves
    • Top 10 Contributor
    • User Since: 2002
    • Posts 1,153
    • Organization: Village for Families and Children
    • Products:  The Raiser's Edge

    Appeal Results

    If you are using the appeal function on Gifts (I have made this field required) you can get an appeal report right from RE. The big decision on gifts is sometimes "what was the actual appeal for this gift" and you will never be 100% correct - but as long as you are consistent you will get results you can use. 1) On the appeal record itself you would need to put in the number solicited for that appeal. (how many total letters, emails, did you send?) 2) Use the individual response device used (the envelope or the web form used) and add that to each gift you received from this appeal. 3) Print the report in campaigns, funds and appeals reports called Appeal Performance Analysis which will give you a response rate on that appeal. Melissa S. Graves Director of Development Services The Village for Families and Children mgraves (at) villageforchildren.org www.villageforchildren.org GET ON THE BUS! Check out what the Blackbaud User Society is talking about today at www.blackbus.org!
    Melissa S. Graves
    Annual Fund Database Manager
    Pathfinder International
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