I was recently reading an interesting article on the net revenue vs. gross revenue thought process.
Past blog posts I’ve written have addressed the Hedgehog Theory, Kicking Sacred Cows to The Curb and Nonprofit Doesn’t Mean Don’t Make a Profit, which all focus, in different ways, on programs that your members value and where you’re making money.
When looking at your programs many suggest you look at the net revenue for each of your programs (including fully loaded costs, i.e. staff) not just the gross revenue. Be smart about where you put your chambers resources.
The more you focus on net revenue the better your spread will be at the end of the year and you’ll be able to put more money to reserves.
And we all know in today’s economy anything we can do to improve efficiencies and improve your bottom line will be well received by your board.
Which would you rather have a bigger gross budget or a better net in your next budget cycle?