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February 23, 2019

The Cost of Doing Ministry

By Mark DeYmaz

Over the course of a thirty-five year ministry career I’ve progressed (thankfully) in my understanding of best practices when it comes to handling money in the church. For example, I no longer:                                                     

  • Collect money for t-shirt sales in one pocket and camp registrations in another, as I sometimes did when I was a youth pastor;
  • Count the Sunday offering, record it in a ledger, and deposit it in the bank, as I did in first planting Mosaic; or
  • Continue to think that enough money will be received by requesting donations to cover the cost of some things churches typically provide, such as free coffee, now that I’m more realistic than optimistic when it comes to church economics.

On this last point, it’s likely you know what I’m talking about.

Say that a church provides free coffee to people on Sunday mornings, and next to the coffee pot is an open jar with a sign that reads, “Donations Appreciated.” While unspoken, what that sign really says is:

“Do you know how much it costs the church in time and money to have hot coffee ready and waiting for you each week? Please… Help us out by making a donation. That way we can keep providing coffee to you free of charge, avoid appearing cheap (as if we don’t have faith), or having to sell something in the church to cover the costs (you know how Jesus would feel about that!).”

Youth groups, too, for example, do something similar when providing free slices of pizza on Wednesday nights. In either case, assume the cost to provide coffee or pizza is $100 a week, but just $45 a week is collected through the donation jar. This amounts to a loss of $55 each. Over the course of a year, then, some $3,000 will be squandered in this way, money otherwise given through tithes and offerings as unto the Lord. Now… Consider how many times, how many ways, and in how many other areas of the church something similar plays out. The financial loss adds up exponentially! Yet pastors don’t seem to mind. Why? Because we’ll suggest to the finance committee that needs justify the expense, or otherwise explain away losses as simply “the cost of doing ministry.”1

In business, when a company spends money in such a way – for example, as churches are doing in providing free coffee – the giveaway is considered part of its “customer acquisition cost… the cost incurred by an organization while convincing a customer to buy a service or a product. In other words, it is the cost of resources for the business in order to acquire a new customer.With this in mind, pastors might similarly see a value in providing free coffee hoping that through hospitality the church can attract new members, as well as retain those who are already part of it. While there’s nothing wrong with such thinking, we should recognize there is a difference. In business, “Acquiring new customers involves persuading consumers to purchase a company’s products and/or services.”3

Stated another way, businesses have a plan to convert giveaways into revenue and thus recoup expenses when people who receive something for free go on to purchase other goods and services. Churches, on the other hand, do not have goods or services to sell so as to offset the costs, for instance, of providing free coffee. Therefore, responsible ministry leaders are left only to hope and pray that visitors and others drinking the free coffee will donate money through the jar, join or keep coming to the church, and in time consistently contribute through the offering.

Thus, some will argue:

  • Providing free coffee helps the church acquire new members and retain existing ones;
  • The cost of providing free coffee will be covered through current and future giving;
  • To offset any loss of income that comes from people leaving the church for one reason or another, we should provide free coffee to attract new members.

Nevertheless, successful companies cannot afford such losses as we’ve described, nor will they accept them. On the contrary they expect, track, and measure profits from sales against any money otherwise spent to acquire new customers in the short-term, and to retain them long-term. In other words, “(t)he last thing a company wants to do is spend more on acquiring customers than the customers spend.”4

When pastors label something as “ministry” in the context of losing money spent, they do so generally to describe a financial loss. Typically, then, pastors do not think about losses that come from giving away free coffee, for instance, the way business people do; nor do they develop a strategic plan to recoup such loses. Rather, we consider financial losses as something that comes with the territory. In fact, pastors are so accustomed to spending and losing money in the way we’ve described that they’ve taken to calling it an “investment” in people, presumably to make themselves and others feel better about it. Where business is concerned, however, net losses are considered unacceptable and unsustainable. In the future, ministry leaders must consider them to be so, as well.

Wanted: Determined Nonconformists

Michael Feuer, CEO of Max-Ventures, a private equity and consulting firm, and co-founder of OfficeMax, writes, “Docile acquiescence of a problem that chronically plagues performance too often is accepted and referred to as ‘just the cost of doing business.’ These types of problems that mute or stifle performance can usually be partially or completely solved. It may be time-consuming and costly, but an investment to eliminate an issue or even mitigate a heretofore perennial profit drainer can provide a sustained and significant payback.”5

Did you catch that? Feuer calls “docile acquiescence” a problem too often accepted in business. That’s what we’re talking about, too, as it pertains to ministry leaders tasked with fiscal responsibility and oversight of a church. Indeed, churches cannot afford any longer and pastors cannot accept docile acquiescence when it comes to money needlessly squandered. Sure, give away free coffee…but develop a plan to recoup the cost.

 

NOTE: The following article is an excerpt from the forthcoming book, The Coming Revolution in Church Economics: Why Tithes and Offerings are No Longer Enough and What You Can Do About It, by Mark DeYmaz and Harry Li (Baker Books, September 2019). Used by permission. Join Mark and Harry for a pre-conference discussion of the future of church economics at Mosaix’ 4thNational Multiethnic Church Conference, November 5-7, 2019, in Dallas, TX. Visit www.mosaix2019.com to learn more.

__________________

1 This a play on the more common phrase, “the cost of doing business.” By definition, “The cost of doing business refers to all the expenses incurred by a firm or a sole proprietor in producing and selling goods or services. The cost of doing business depends on a wide variety of factors, including the cost inputs of goods and services, the costs of compliance with any regulations, interest rates on borrowed funds and taxes. The lower the costs of doing business, the easier it is for the business to operate, hire labor and pay taxes.” See https://bizfluent.com/how-6763183-calculate-cost-doing-business.html

2https://www.techopedia.com/definition/16537/customer-acquisition-cost

3https://www.ngdata.com/what-is-customer-acquisition/

4 Ibid.

5http://www.sbnonline.com/article/just-cost-business/

 

ABOUT THE AUTHOR

Mark DeYmaz

Mark DeYmaz (@markdeymaz) is a recognized champion of multiethnic church planting, growth, and development, for the sake of the gospel throughout North America and beyond. He is the founding pastor of Mosaic Church in Little Rock, AR, and a co-founder of the Mosaix Global Network. His books include Building a Healthy Multi-ethnic Church and the recently released small group study, Multiethnic Conversations.

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