How to identify the financial triggers for multi-site success

This is a guest post from Nathan Artt, founder of Ministry Solutions. Nathan brings incredible insights on church financial health and the 'stories that numbers tell' and very few others talk about. Today he gives an in-depth look at how your church can identify whether or not to launch another multi-site campus based on key financial triggers.

In the last post, we talked about the ABCs of identifying when you are financially ready to expand to a multi-site campus. In this blog, we’ll use one of my favorite tools, the Generosity Potential Assessment from Generis, to examine in more detail how to identify the trigger points associated with being ready.

Diving into the numbers behind the decision to expand

Let’s take a look at the chart below for a church with 500 seats in the worship center:

Multi-site #1

At first glance, it looks like this church is in situation where they need to cannibalize growth and look at multi-site expansion. This church has grown 67 percent in just two years. However, if you look closely at the data, the number of giving units has only increased by 20 percent. Both the budget and the percentage of giving units to attendance have decreased dramatically.

How an increase in generosity can support healthy multi-site growth

With growth comes added costs for staff and resources, volunteer fatigue, and other factors. To offset this, there needs to be a major focus on growing the donor base. Here’s how a very small increase in giving can dramatically impact your church’s budget:

Multi-site #2

If the median combined income in your area is around $65,000, and your church averages $2,000 per giving unit, then your average donor gives just over 3 percent of their annual income. This isn’t much of a surprise, considering the average evangelical Christian gives 4 percent.

So, let’s propose that we can increase the number of giving units by just 10 percent per year and the average donor from 3 percent to 3.6 percent of their annual household income, which should be attainable considering the 33 percent annual attendance growth:

Multi-site #3

By a simple adjustment to the level of generosity in the church, you can literally increase the annual budget by over $600,000, without even taking into account all the new people who are showing up.

The additional income in this graphic would more than likely pay for not only a campus expansion, but the staff and resources you need at the main campus.

Here are the key takeaways for using key triggers to determine whether to expand your multi-site church:

  1. Stop looking at your annual budget as a 'bottom line' number. Your budget is a sum of small parts, and those small parts are giving units. The only way for you to increase your annual budget in the church is to focus on donor growth and creating a culture of generosity in your church.
  2. Most growing churches have more need than they have budget. However, if you are intentional in discipleship around giving, it only takes small adjustments to have a drastic impact on your church.

By taking a step back and looking at the numbers, your church can make an informed decision on whether to launch a new campus. In the end, making the right decision means protecting the overall health and growth of your ministry for years to come.

What process does your church use to determine whether or not to launch a new multi-site campus?

Photo Credit: Au Kirk via Compfight cc

Topics: This entry was posted in Leadership Roles, This entry was posted in Blog, This entry was posted in Executive Pastor, This entry was posted in Finance & Generosity, This entry was posted in Multi-Site Campus Pastor

Posted by Church Community Builder Marketing Team on Feb 10, 2014 9:15:14 PM