Do we spend funds efficiently?

We keep our overheads low, less that 10-12 % of overall expenses. The overheads are to ensure transparency by keeping an internal and external auditor to track our spendings, and on logistics to ensure that the food reaches quickly.

Rations (i.e., the food that wind up in the hands of recipients) make up the vast majority of what we spend, with a small portion of our budget going towards the cost of delivering the food, and an even smaller portion towards fundraising.

Efficiency

We define efficiency as the total food transfers committed to recipients divided by all of the funding we spend on food transfers and the costs of delivering those food transfers. Efficiency is the proportion of each donated dollar that ends up in the hands of recipients as food, masks or hygiene supplies. For the non-food portion (“delivery costs”), we include everything that’s not fundraising: ranging from parts of our NY office rent and time spent by our senior management, to the salaries of field officers going door to door to sign people up to receive food, to the withdrawal fees recipients pay mobile money agents in order to withdraw funds.

Cost per dollar raised

We hope to maintain a ratio of roughly $0.05 spent per dollar raised.

What about “overhead”?

1 Million Meals’ lean model scores very highly on traditional “overhead” measures. The vast majority of our operations spending goes toward food transfers.

Do we spend funds quickly?

Another good question about 1 Million Meals’s finances is whether there is a long delay between when we raise funds and when we deliver them. We are spending the money on weekly basis or as we raise them.

Room for more funding

1 Million Meals could productively use several hundred million dollars more than we expect it to receive. Achieving greater scale would enable us to reach more people more efficiently, and it would carve out a bigger space for people in poverty to control more of the aid and philanthropy budgets meant to help them.