Calculating Cost per Dollar Raised - a debate

Ryan Hyde

Hi folks!



I'm having a little bit of a debate today with some my admin team. I'm doing some reporting on how our fundraising efforts in relation to our three major events have changed over time, and one metric I want to use is cost per dollar raised. After doing a little research and reading up on the ways this is done, it makes most sense to me to use the formula Expenses/Net=cost. However, my immediate manager thinks we should bue using Expesnes/Gross=cost. 



Obviously these two calculations result in different numbers, and dividing into net proceeds looks worse than dividing into gross revenue. 



So if you do this calculation, how do you go about doing it? Net or gross?

Carolyn Moatz

I think you should go with gross for general reporting, unless you'd get a lot of the gifts that come in through the event without having it. The portion of the money that comes in for the event and covers cost is still a dollar raised. However, I see no reason that you can't report on both. The net number will let you see more easily if your income is keeping up with the expenses from the events