Funding a not-for-profit business is rarely straightforward. Martin Brimfield of Neath Afan Gymnastics explains how a business loan has helped his organisation.
Hi Martin. Tell us a bit about Neath Afan – what does the business do, and how did you get involved? We’re a not-for-profit gymnastics club based in Neath, Wales. I got involved because my daughter was interested in gymnastics, and the club was looking to become a formal business with its own dedicated facilities, as opposed to a basic club operating out of a sports hall.
What would you say the best bit about running a small business in Wales is? The sense of community here is great, and we are well supported by the community. That said, many customers tend not to understand that there are many forms of business organisation. That is very true of our gymnastics business set up. People either think that you make vast profits or that you’re run by the council. They don’t necessarily grasp that there’s a middle ground.
So is that your biggest struggle, getting people to understand the business? To have customers understand the context of the business is important. In our case, we’re a not-for-profit business. But lots of people aren’t sure what that means. Even though we aren’t running for personal profit, the business still needs to make money. We still need to charge fees, and to be paid on time. Running a business like this, the assumption is often that that you’re making a fortune and are sometimes challenged as to why they can’t have what you’re doing for less. Some even ask why they must pay at all, because they assume, you’re already getting money from somewhere else.
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Do you think this is a problem that’s unique to Wales, or do other organisations around the UK experience similar issues? I think it’s an issue that a lot of not-for-profit businesses must have to deal with. Within our organisation we have two main service areas: Gymnastics as a sport with facilities to allow gymnasts to be able to achieve their potential, and gymnastics-based activities for the local community, where children can get involved in gymnastics, improve their general wellbeing and have fun. We must meet the challenge of balancing fees in such a way as to provide the best experience and outcomes for all customers.
What other challenges does a business like yours face? Well, we’re based in an area of deprivation. This can prove a challenge because people don’t necessarily have the money to pay fees at a level that others in more affluent areas would consider very good value for money. Unfortunately, for some families any expenditure has to be thought out carefully. We strive to find that middle ground as far as our fees are concerned while having to ensure we can meet our commitments to our suppliers and staff as well as our customers.
When you’re first setting up a business like ours, the biggest challenge is availability of money. It’s difficult to get anybody to be prepared to stick their head above the parapet and put any money up at all and while there are grants available there are no guarantees. Getting off the ground is a real challenge, and I think that’s probably true across the UK – it’s about being able to find the money when you need it.
So how does a business like yours find the funding you need to operate? We have focused our business model on being fully self-sufficient as far as revenue and operating costs are concerned. However, having a lender like iwoca in our corner has been great. iwoca have provided excellent service and support and we know that if there’s ever a shortfall in our cash flow, we’ll be able to borrow money on a short-term basis to cover any commitments. It gives us a level of flexibility that we don’t otherwise have.
That’s great to hear! Thanks for your time Martin.