We know one of the biggest worries our members have is the long-term financial health of their group. Even groups who make a surplus each year can have that nagging thought: 'what happens if something goes wrong next year?' More money would mean less worry and more stability, and perhaps more importantly it would mean more opportunities to try new things and enjoying making music.
Whilst no two groups are the same, there are common themes and approaches that can be applied to the different situations music groups face. This guidance will look at planning and give an overview of some of the things you can do to help increase and secure your income, with links to more detailed guidance.
It’s not just a case of ‘get more money’
Improving the financial health of your groups shouldn’t just be about getting some cash in as quickly as you can. It’s about looking at your finances as a whole; where does your income come from? Are you maximising those sources of income? Where do you spend most of your money? Could you cut costs? Are you missing some 'easy wins'? Could you do things differently to generate more income or save money? Are there any areas you’re not making money from but could be?
There are two key words when it comes to income: sustainable and diverse
Sustainable: regular income that will be there every year. A funding bid for a project can be great – but the money is normally a one-off injection to do something specific. Claiming Gift Aid on your membership subscriptions is money that you can get every year and spend how you want. Building good corporate sponsorships is more permanent and reliable than a bucket shake every Christmas.
Diverse: the more different sources of sustainable income you have, the better you can deal with one decreasing or disappearing all together. For example: membership fees very often make up a significant proportion of a group’s income. But if you're too reliant on them and numbers fall, the financial impact can be felt very quickly. Having diverse sources of income means you can absorb the loss of membership income for longer - giving you time to increase numbers again or find alternative income.
Think about how much you need and for what
Below are some examples of areas to look at in order to increase income. They involve varying amounts of work and offer differing potential returns. If an extra £300 per year would make a big difference to you breaking-even, then maybe an annual fundraising event will do the job. If you are looking for an extra £1,000 to invest in expanding, then you might need to try a few things or make more fundamental changes to your existing income streams.
Before you launch into any of these it’s worth taking some time to plan and think about why you want money and how much you might need.
- Have you been dipping into reserves and need to stabilise and break even?
- Would you like to make a small surplus to breathe easier?
- Maybe you want to create a decent surplus so you can expand and invest?
- Maybe you are stable but want to try something new and need one-off funding?
Having a clear idea at this stage of what and how much you want will help you decide where to direct your efforts and which activities to spend time on.
Increasing your income
Below are some of the main options to focus on when looking to increase you income.
Membership fees: often the biggest source of income for a group and so worth careful attention and regular review. There are lots of things you can try but they can be broadly split into two approaches:
- Adjustments and incremental increase - are you under-pricing yourself? Could you reduce discounts to increase revenue?
- The bigger questions - could you do something fundamentally different to increase your membership numbers and therefore income? This could mean changes in your membership structure or the culture and aims of your group.
Find out more: ‘Increasing your income: Member Subscriptions’
Event income: the same thinking can be applied to your events and ticket sales:
- Pricing tweaks - charge more, or maybe charge less to sell more.
- Change your events - try something different at your events, or a completely new type of event that might attract a new and bigger audience.
Find out more: ‘Increasing your income: Ticket sales and event income’
Corporate sponsorship/partnerships: there are many different models of working with local businesses with lots of opportunities to:
- raise money
- cut costs
- find new members
- find new audiences
Find out more: Increasing your income: Sponsorship
Friends/supporter scheme: a great way to build engagement with audiences and also offers a more reliable source of income than tickets sales alone.
Find out more: Increasing your income: Friends schemes
‘Traditional’ funding (grants/trusts etc.): these can be a great way to solve a specific problem or fund a one-off project. And those projects can have a wider impact on member engagement and raising profile, and bring in more money (e.g. new members and audiences).
On the other hand they can involve a lot of work in applying and reporting (if successful) and more importantly they are rarely a long term solution to your group’s financial health. The money is normally a one-off payment (albeit maybe in instalments) and has limitations on what you can spend it on.
Crowd funding: as with traditional funding above this can be great for certain things, and can offer greater potential in raising profile and engagement. But also has the same question marks around sustainability.
Find out more: Crowd funding Case Study
Donations: not necessarily sustainable but a simple ask can be very productive, and done well can turn into regular giving.
Fundraising events and sponsored challenges: the options are endless; from the simple through to the grand and the unusual, all with potentially rich rewards. A good event can also have huge profile (and income) raising benefits beyond the money raised on the day.
Gift Aid: free money - or as close as it gets anyway! An extra 25% on donations made by British taxpayers.
Find out more: How to claim Gift Aid for your group
Gift Aid on subscriptions: it’s not just donations – many groups can also claim Gift Aid on the fees their members pay – or part of the fee at least. It is a bit of work to set-up initiall,y but normally well worth the investment, and definitely ticks the sustainable box.
Find out more: How to claim Gift Aid for your group
Easy fundraising: get your supporters to raise money whilst they shop – what could be better?
We hope you find this Making Music resource useful. If you have any comments or suggestions about the guidance please contact us. Whilst every effort is made to ensure that the content of this guidance is accurate and up to date, Making Music do not warrant, nor accept any liability or responsibility for the completeness or accuracy of the content, or for any loss which may arise from reliance on the information contained in it.