Nonprofits are always looking for ways to cut costs without jeopardizing the safety and productivity of their facilities and end purpose: educating students, gathering congregations, and serving the community. There are plenty of ways nonprofits can cut costs and maintain standards. But without suitable facilities and maintenance plans in place, many assessments and studies have shown that nonprofits and institutions may effectively be increasing their costs.

Productivity and efficiency

cut costs

Along with controlling maintenance costs, independent research and studies estimate that facilities management programs and systems improve cleanliness, safety, productivity, and even social interactions. In the case of an individual school or collective district, for example, that can have a devastating impact. Depending on your district’s objectives for cost reduction or efficiency increases, here’s how you can forecast the outcomes:

(total maintenance salaries) x (desired/anticipated percent increase in productivity) = cost savings

If your district has a maintenance payroll of $350,000, for example, and you want to improve productivity by 20%, you can anticipate annual savings of ~$70,000.

The same calculation can be applied to any organization.

Inflated inventory

A school’s inventory includes student supplies, computers, equipment replacement parts, health and safety equipment, meals, and more. Other nonprofit inventories are similarly targeted to serve their benefactors. All of these goods are crucial for efficient operations, but you may be paying more than you need to with too much or too little of each.

Some studies have found that nearly 30% of organizations overstock their inventory, which is money that can be redirected to other essential expenses. On the contrary, a company with insufficient inventory faces higher ordering costs and the variable cost of not having the item in stock (i.e., safety hazards, equipment downtime, educational or services risks, etc.).

Costs for renting a building

Many organizations rent out areas in their buildings for community use, yet many either do not charge tenants appropriately or lack the resources to do so. Uncollected facility rental fees can result in hundreds of dollars per month in lost revenue.

You'll Lose Revenue

Schools often rent out their classrooms, auditoriums, gymnasiums, and even sporting fields to the local community. Religious institutions make their worship and fellowship spaces available for weddings. Depending on the venue, group size, and day of the week, charges can range from $5/hour to $150/hour. Even if your facility leases out space three times a month, there is tremendous financial opportunity.

Labor costs

With several maintenance personnel on your team, it’s critical that everyone works effectively. A facilities management system reduces the amount of time necessary to locate work orders, acquire information, connect with requestors, and complete jobs. Each team member saves around two hours each week, which may be assigned to other work requirements.

Increases Revenue

Utility expenses

Institutions in the United States spend more on energy than any other expenditure, and the worst part is that one-third of the energy spent in schools is wasted when the facility is unoccupied. Imagine how much money your department could save if it could effectively monitor, control, and reduce its energy use.

Sound facility management software and systems are available that can consolidate facility rental scheduling and reservations, work order management, systems automation (including HVAC controls to adjust utility use when schools are closed or not in use), trends, and cost analysis in real-time so can identify new opportunities for savings and revenue generation. Learn more about available systems at https://www.facilitron.com/facility-owners/facility-management-software/.

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