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Article updated: 7/18/2011 5:58 AM

Business orientation helps nonprofit succeed

By

Mark Milligan understands his business' bottom line, even though the "business," Bridge Communities, Inc., is a nonprofit.

"Tell people you work for a nonprofit and they think you don't have to make money," Milligan says. "But not-for-profit is simply a tax status."

Bridge Communities is a highly successful Glen Ellyn-based nonprofit that provides transitional housing and related services to homeless families in DuPage County. The intent is to help the families stabilize, change their lives and return to society in a productive manner. Milligan, president and co-founder, runs Bridge Communities on a strict business basis.

That business orientation is especially important today. With both household and business-customer pocketbooks flatter than they have been for decades, many smaller businesses and nonprofits struggle to balance income and expenses.

Yet, Bridge Communities does well, in part because Milligan and co-founder Bob Wahlgren have understood the income-expense equation from the beginning. As a result, Bridge communities has developed multiple income sources and pretty much stays with what in the business world would be its corporate mission.

That's an approach Lynne Bosley probably would like. President of the United Way of Elgin, Bosley worries "quite a bit" about the management capabilities of the social services agencies in the greater Elgin area.

It's not that Elgin-area social services agencies are poorly managed. Like any good funder, however, "we look for measurable outcomes" when agencies submit requests for money, Bosley says. "The management (abilities) of the agencies ultimately affects those outcomes" -- and future funding.

Bosley's hope is that social services leaders will become "more proactive" and seek ways to adapt to a fundraising world that is significantly different from what it was just three years back. Agencies, she says, need to find ways to work more collaboratively, perhaps pooling resources or -- "I hate to use the 'M' word," Bosley interjects -- even merging when two organizations serve the same need.

A business focus might help. Milligan, for example, was a salesman and Wahlgren a banker when they created Bridge Communities in 1988. "As businessmen," Milligan says, "We knew it was not enough just to generate cash. We had to generate funds from diverse sources."

From the early days, "We did not want to become tied to government funding," Milligan says. Today, Bridge Communities' strongest sources of revenue are individual contributions, the checks people write at Christmas and corporate foundations.

Housing is key on both sides of the ledger. Bridge Communities owns 16 apartment buildings, mostly six flats, throughout DuPage County. "We own a lot of real estate," Milligan says, "and it is expensive."

But good cash flow principles help. Families in the program pay rent that helps cover the cost, and faith-based partners, mostly churches, participate by paying program fees on an apartment-by-apartment basis that provide important income as well.

Contact Jim Kendall at JKendall@121MarketingResources.com.

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