Why Non-profits Still Need to Make a Profit
Robin Helweg-Larsen
Published Date
Non-Profits Need Business Acumen
Sometimes, people working for non-profits or not-for-profit organizations are unfamiliar with basic business concepts. Many don’t consider themselves to be “in business”—they see their mission as improving the community or the world, not maximizing profits.
But non-profits are still businesses, and their employees must have the business acumen to operate successfully.
Understanding Finances at Non-Profits
Non-profits must bring in enough money to cover expenses, or they won’t survive. They also need cash flow to pay bills and avoid financial trouble.
And if a non-profit wants to expand its services, it must generate a cash surplus to fund future operations.
The same financial tools used to analyze a for-profit business can be used to assess the health and sustainability of a non-profit:
- Balance Sheet – Shows what the organization owns and where its funding comes from.
- Income Statement (P&L) – Tracks income and expenses over the year.
- Budget – Forecasts and controls revenues and expenditures.
- Cash Flow Forecast – Ensures day-to-day liquidity needs are met.
When working with non-profits such as hospitals, halfway houses, or international development funds, the terminology may differ:
- Profit and loss → Income and expenses
- Equity → Net assets
- Retained earnings → Additions to net assets
But just like for-profit businesses, these financial metrics must be analyzed and improved regularly.
Business Simulations for Non-Profits
Like any other business, non-profits need employees with strong business and financial acumen to operate successfully and achieve their goals.
Income|Outcome business simulations provide the financial knowledge non-profits need to survive and thrive—helping them improve their financial literacy, decision-making, and long-term sustainability.
Whether you run a non-profit or a for-profit business, Income|Outcome® can help upskill your employees and strengthen your organization.
Want to Build Financial and Business Acumen in Your Organization?
Contact us today to bring business acumen training to your team.
