How a charity waste audit could cut costs and boost efficiency by up to 20%

In today’s world, where sustainability and cost-efficiency are paramount, charities and non-profit organizations face unique challenges.

The cost of running a charity has risen this year with changes announced in the October 2024 Budget taking effect from April 2025, increasing the cost of employing staff.  For many charities, a focus on reducing costs will help to ensure a sustainable future, especially for those who may also see more requests for their services and reduced funding. Whilst there might be many ways to review costs, a ‘waste’ audit could be a smart move, as it could lead to savings of up to 20% by identifying and implementing strategies to combat this.

By waste, this means ways of making the charity more efficient and driving growth for the future, making them more streamlined in their processes and strategy.

Going through the process of a waste audit can help to uncover opportunities as well as strategies to start the process of removing wasteful practices. Those opportunities could in turn lead to higher income and bigger surpluses.

There are several key elements of a waste audit for a charity 

• Overproduction and overservicing – Is where the charity is producing more than their customer’s needs, so this could be producing too many goods or merchandise to sell as well as offering services which are used less frequently. Also, with the use of your team’s time, do you have the right number of people in meetings and are you using the correct IT and technology which ensures processes can be faster.
• Waiting – This occurs whenever time is not being used efficiently. Much of the process is being held up waiting for the next operation. Dealing with too many emails, messages and calls can be a key driver to delays building or not responding to them quickly enough. Waiting for funding can also cost money especially if formal documentation and applications have not been correctly prepared.
• Transporting – How much transport of people, goods or product/services happens and could there be a better process for delivering this. For example, could trustee meetings be better managed say on Teams, rather than in person? The charity would need to assess its constitution to ensure this is possible. Also, are Trustees well briefed before every meeting to make the best of the meeting? Perhaps sending agendas out 2 weeks prior to the meeting.
• Inappropriate processing – Quite simply are you using the right tools for the job. Are there instances where you are using the wrong people or tools to process information or take part in activities? Review IT and general systems such as your accounting function to see if you are getting the most out of it, or there are more efficient (and cheaper) solutions on the market.  
• Unnecessary inventory – If you are a charity with a retail arm selling goods, clothes, food or furniture, consider if you are holding onto any products or stock items that realistically won’t sell quickly. It’s important to review the items you have in stock and consider what items you want in the future to avoid this issue and make sure this is communicated. For example, if book donations don’t sell well, don’t accept them as not only does it take space to store and display them but also money to recycle them. 
• Unnecessary motion – This is about the ergonomics of the work space, so the physical movements to complete a task and could this be rectified by changing the layout of a building. Reducing unnecessary movement also reduces unnecessary distractions.
• Defects/rework – Are there any errors that keep occurring in the process of delivering charitable services that could be improved. Review processes to eliminate the cause of these issues. Mistakes such as misread orders, not checking for errors, failure to meet deadlines and obligations and ineffective or insufficient training can also contribute to this.

How could a waste audit help?

By going through a waste audit, a charity is able to understand further what areas they can look into and develop solutions to implement. These solutions can then be used to reduce the cost or improve the efficiency therefore creating a better surplus for the charity. By creating more time, you are developing more opportunities.

If you would like to talk to one of our team regarding a waste audit and implementing this on your charity, please do get in touch as this could be the right move for you.