Peter Drury of Splash.org tells us how to answer this challenging question.
He says to tell ’em, “Overhead is like cholesterol. There’s good overhead and bad overhead.”
Good overhead = Lights, phones, hard-working staff that produces results, etc.
Bad overhead = Waste
The MarketSmart take on this: Be thoroughly transparent about what you believe is good overhead and what’s needed. Tell stories about why and how your organization spends the donations it receives. Relate the stories to the mission you know your donors support. And, remember to tell folks what you are doing to cut bad overhead— waste. Be open, honest, and real about it. Everyone has waste. Acknowledge that you do too. But point out what you are doing to cut it and you’ll draw more big gifts from major donors.
The trick is to engage further and be transparent, not to skirt the issue or twist the numbers so you can get 4 stars from Charity Navigator.
You can take control of this issue if you remember that people who ask about your overhead are actually “leaning in”. They want to engage with you and learn more. So give them what they want… information. Tell them your story about overhead. Remind that that it’s necessary. Just like good cholesterol. And, finally, allay their concerns by telling them that their money is “going to the right places to have the greatest impact.”
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