EFFECT PERSONAL SELLING HAS ON OUR OFFERING
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Initial Budget Plan
Covenant House just like any other charity organization continually wrestle with improving and maintaining their operations of ensuring that homeless youths are housed, fed, educated and socially protected from harm. Since Covenant House is a non-profit organization, the sources of revenue are purely from grants and donations. This calls for proper management of these funds as the expenditure tends to exceed revenue. Therefore, the organization constantly strives for sustainability in ensuring that the homeless youths are safe. The major expenditures for this organization is on costs of educating the youths, providing food and shelter to them, community participation and the general administration costs. This is why there is need to have a well-planned budget that focuses on the major roles, objectives and key goals of the organization.
According to Covenant House plan, funds to run the organization will be received from the sale of the organization’s logo items, contribution from the general public, grants and donations from sponsors and well-wishers. The funds will account for payment of organization’s programs and missions across the United States and Central America.
The initial budget planning for Covenant House involves the selection of a budget committee from volunteers. The volunteers have to be members of the organization and be familiar with the operations of Covenant House in the previous years. In addition to that, they must express the desire of serving Covenant House as a whole and be equipped with knowledge of ordinary budgeting either at business or personal level. The budgeting committee will have to define the budget timelines, estimate the cost of resources required to achieve the activities of the organization and develop the final budget.
Sources of revenue
As stated earlier, the budget of Covenant House will be financed by public contributions, grants and restricted funds, ticket sales from the organization’s events and merchandise. With the growing fame of Covenant House for helping homeless youths and kids, public contributions from annual fundraising is expected to increase. Covenant House also complies with grantor’s requirements since all its audit reports are available to the public and hence some revenue is also expected from grants. Moreover, Covenant House will organize family and sporting events which will be used to drive funds through the sale of entry and participation tickets and sale of merchandise such as branded t-shirts and base caps.
Budgeting for expenditure and Grants.
The budgeting committee will prepare a cash flow budget that breaks down the expenses and revenues received to ensure that the cash for running the organization is there when needed. Covenant House has already acquired assets in various states across the United States in form of land and buildings for housing the homeless youths. However, more assets will be borrowed from sponsors and board members. Some donors and grantors also provide non-cash items such as computers to enhance the learning of the youths, clothes and food donations to the charity homes across the United States. In addition to that, Covenant House plans for restricted grants in advance to ensure that donated funds are used for proper reasons. To ensure this, Covenant House discusses the usage of grants not only with grantors but also with other organizations that have received the same such as Stand Up For Kids.
Measuring the Success of Budget Plan
Since, Covenant House is a non-profit organization, the success of an effective budget plan can only be measured by the efficiency of keeping the homeless kid and youths and attending to their basic needs of education, food, shelter and clothing. A decrease in the number of street kids and youths across the United States is a direct indicator on the progress Covenant House is making in helping this minority groups. This is only possible with proper financial management that lies with excellent implementation of budget plan. One best way of measuring the success of the budget is through achievement of the goals of Covenant House in ensuring that there are no kids in the street. Satisfaction on the quality of education that Covenant House offers by the homeless youth is a direct indicator that, the grantor’s money for the education kitty as budgeted for was used well.
Internal comparison in the Covenant House will also indicate the success of the budget plan. Since Covenant House has no direct competitors with less similar charity organizations across the United States, internal comparisons can be used to access the success that the organization has made in helping homeless youths. A comparison of the previous year’s youth admission statistics with the present year can indicate success. For instance, if the number of admitted youths in Covenant House homes is higher than the previous year, then it indicates that the organization has made progress in its objective. This means that, the methods used in acquiring revenue and how expenditures was effected was appropriate (Elizabeth, 2010). The organization can confidently attest that, the methods of raising funds such as fundraising as was suggested in budget planning was effective and hence should be upheld. Covenant House also learns the importance of participating in activities that raised its revenue through the sale of its tickets and branded merchandise.
Achievement of the principal goals and objectives of Covenant House will indicate the success of budget and the general organization. The objective of the organization is to help as many homeless youths as possible. Therefore, an increase in the population of youths in its centers indicates that the organization is in the right course. However, it is not all about keeping many homeless youths, what matters most is providing for their basic needs such as shelter, food, clothing and education. Efficient provision of this basic needs indicates that the method the organization used in driving revenue and making expenses was appropriate. It is only through proper management and expenditure that the needs of the homeless youths can be met. In addition to that, a statistical and fiscal analysis of the sponsor, grantor, volunteer records, client records and fundraising efforts provides data that is useful in evaluating the success of Covenant House in meeting its goals and objectives (Elizabeth, 2010). The response from the community members of the states where Covenant House has branches can offer data on whether the organization is successful or not. Positive response from the community members will indicate that the organization is doing well in its role as home provider for the homeless youths.
Ethical issues in marketing plan
Covenant House just like any other non-profit organization can experience an upsurge of unethical issues in marketing the services and products it offers to the homeless youths (Linda, 2015). There are several issues that progressively plague non-profit organizations that can lead to financial abuse and fraud. If this misconducts goes unaddressed, the image of Covenant House can undergo public erosion leading to loss of confidence which can put the funding capabilities of potential donors, grantors and sponsors in doubt.
To begin with, one of the ethical issues that can be expected on the marketing plan, is the case of inflated allowances and salaries of the marketing team. If the marketing team members earn exorbitant salaries and allowances in popularizing the organization, ethical concerns might arise. This is because, there are chances that the efforts of the organization in assisting the homeless youths will be underfunded. The organization cannot afford to operate with maximum expenditures since its sources of revenue are limited. The large travel budgets across the United States granted to marketing team members can raise ethical concerns. This is common when such generous compensation of the team members results to failure in meeting the social needs of the organization.
Secondly, accountability is an ethical issue in marketing the organization. Covenant House just like any other non-profit organization enjoys several tax incentives. In addition to that, there is little oversight on how the organization spends the funds it receives. As a result, the products and services that the organization offers to the community may not be funded appropriately. Linda (2015), Insists that such organization lacks proper strategic plans to properly use the acquired funds. As a result, marketing programs may be unsuccessful compared to if charity organizations applied more diligence to market budgeting practices.
Thirdly, a conflict of interest may also arise in marketing of a charity organization such as Covenant House. Some board members can use their authority and position for personal gain leading to conflict of interest. For instance, a board member might give lucrative contracts or preferential treatment to specific donors. Some leaders can also give contract and cover up for services given to family members, friends and employees. An example is using the organization to give education sponsorship to a friend’s child instead of acquiring more homeless youths to benefit from the same.
Lastly, fraud and tax evasion are some of the ethical issues common in marketing of charity organizations. Sometimes, members of the marketing team might use the money set aside for reaching new areas and popularizing the organization. This is because Covenant House might lack the budget to hire external auditor and hence use internal auditor who might ignore or fraudulently alter the numbers to block transparency on the usage of the organization’s funds. Furthermore, the team members may take advantage of not being taxed when carrying the organization’s duties to engage in other profitable dealings.

References
Linda, R. (2015) Top Five Ethical Issues for a Nonprofit Organization. Stanford Social Innovation Review. Cited from http://yourbusiness.azcentral.com/top-five-ethical-issues-nonprofit-organization-5979.html on November 5, 2015.
Elizabeth, H. F. (2010). The Budgeting Process. Greater Washington Society of CPA EDUCATIONAL FOUNDATION
Youth Homelessness, (2015) Cited from https://www.covenanthouse.org/homeless-teen-issues/teen-homelessness on November 5, 2015.