About a decade or so ago, I adopted a personal motto, and in the spirit of most tag lines of educational institutions, I translated it into Latin as best as I can: Nil facile est; nil gratuit est (which means, “Nothing is easy; nothing is free”). I’ve recently amended it, since everyone seems to be looking for “something simple” to address their concerns and solve their issues. Unfortunately, we live in a complex world, and we need to get comfortable with it. Complexity is the essence of systems thinking, so the new motto is Nil simplex est; nil facile est; nil gratuit est (“Nothing is simple, nothing is easy, nothing is free.”).
What most schools want to do from a “business perspective” is simply increase revenues, since most have cut their budgets to the bone. Schools don’t want to spend money on a Development or Advancement Director, and, if they do, then there are huge expectations: raise funds, as well as their salary and benefits, with no budget, no assistance, and with immediate results.
What’s not expected, but becomes reality, is that frustration sets in, and it’s decided that doing nothing is more fiscally prudent. It’s one of the reasons why the average “life expectancy” of a Development or Advancement Director is only 18 months (yes, months), while it takes at least 3 to 5 YEARS to get the development ball rolling into somewhat of a juggernaut.
Unfortunately, more of the same happens, so thinking a new advancement person could do better, the pattern is repeated, and, true to the pattern, and the downward vortex continues, sucking down everything around it. Further, in critical economic times, there are more and more opportunities for systemic “glitches” to occur even in the most well-oiled machine.
In light of all that is changing around us, this may be the time to make some incredibly unprecedented changes as well, bringing another well-known phrase to mind: “Drastic times means drastic measures.”
If your school is in this situation, and parents are still paying tuition by a system that generates “in-house” invoices from your school’s accounting program, or the parish or church “takes care” of collecting tuition payments, you should strongly consider utilizing an experienced tuition management company, such as FACTS, to manage your tuition capture process. This is especially true if you’re billing families, using a bank for an automatic debit option for your parents, and using a merchant services provider to accept credit cards that need to be “swiped” at the school. Doing all these things take time, not to mention following up with families that may have fallen behind in their payment obligation.
With FACTS, if families want to pay on a monthly basis, the payment is taken from the responsible payer’s savings or checking account or can be billed electronically, with reminders and follow-up messaging. Such action reduces “slow pay” families and results in a more predictable and reportable cash flow for your school. Further, a tuition management and billing platform is very different from one that just processes tuition. There are some systems that simply process tuition – and no reminders and no follow-up means no control over your processes.
If families simply want to make payment in full, then they can, up-front, before the school year begins, and, if you can structure the agreement so there is no cost to the “pay in full” family on the platform, then upfront tuition collection increases, enabling your school to handle its accounts payable more easily. Once you automate the tuition revenue capture, you can then reallocate time resources from chasing unpaid tuition to chase enrollment, calling those families which have expressed an interest in enrolling their students for the following year. More students in the school means more families to help share the financial burdens, making things easier for everyone.
I’m the local FACTS representative, now serving a select group of schools in West Virginia, Western/Central New York and Western/Central Pennsylvania, but if you’re in other areas of the country, I can put you in contact with your representative.
Since I’ve been with FACTS, I’ve adopted another motto: “Stop chasing tuition, and start chasing enrollment.” Latin scholars, you’re invited to provide a translation since “tuition” really doesn’t translate well.
I’ve also produced an eBook with a system to “shift” your school’s current ways of capturing tuition. You can visit this link to order your copy.
As for where do you get the money to spend, it’s important to have your cash flow practices in place before donors will support your school. You can’t go to a foundation with a request which could include the budget of your school, and show a line that says “Uncollected Tuition.” Yes, a school actually did that once, and the school is no longer open.
Therefore, if a school looks to the Advancement or Development Director to come up with additional revenue to take the place of tuition that’s not been collected, that rationale probably contributes to the short life-expectancy mentioned earlier as well as the downward vortex resulting from uncollected tuition causing a rise in tuition the following year causing less enrollment causing a rise in tuition the following year, etc.
Unfortunately, you may be disappointed to find that there’s no magic trees to shake, nor “make fast money” fundraisers that are foolproof. Those yearly events that were relied upon to bring in five-figures of revenue to the school were cancelled during the pandemic, and while we’re getting into a “new normal,” events have been limiting the number of attendees or, at times, requiring proof of vaccination for fear of providing an unsafe environment.
The best ways to generate sustainable revenues are to increase program income (which comes from tuition, and that means growing enrollment, and the first step to that is keep the enrollment you already have) and to keep expanding the number of individuals deeply engaged with your school who are not a daily part of your school’s life (which is development). Share your successes with those individuals. To do so, you need to capture their contact information (address/phone/email) so you can communicate with them. In turn, these individuals need to “evangelize” the good news about your school to their friends and associates so they can also become engaged in supporting the schools’ successes.
And remember, success begets success. If you simply hold “hat in hand,” you may be unpleasantly surprised by what gets put into that hat.
© Michael V. Ziemski, SchoolAdvancement, 2006-2022