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Associations Now

Three Keys to Nondues Revenue

ASSOCIATIONS NOW, November/December 2013 Money & Business

By: Andrew S. Lang, FASAE

Summary: In his final column for the magazine, Associations Now's "New Money" columnist distills four years of nondues revenue stories down to three recurring secrets to success.

After four years of writing "New Money," I have decided to move on. As a parting gesture, I want to share a few insights on revenue I've gained over four decades of working with associations.

Leverage Staff

Employees are the best single source for identifying new sources of revenue.

Unfortunately, few associations have a system in place to en cour age staff to share these ideas, and many staff members are (often correctly) afraid that an idea they share will become their responsibility. And many associations are so siloed that an idea that might involve another department won't take off.

The solution? Create opportunities for staff from a mix of departments to share ideas. Include newcomers; longtime staffers will be more fixed in their thinking. Ask everybody to bring at least three ideas in writing to the meeting. To encourage free discussion, the highest-level staff should probably not be present.

The ideas you generate will tend to fall into two categories: low-hanging fruit and projects that will require time and/or a notable financial investment. The latter need to be sifted for midterm and long-term consideration: Taking on more than one or two major new revenue projects at a time likely will overtax an already burdened staff. Analyze the ideas the CEO thinks are best from the perspectives of member need, mission, and ROI. Create a business plan for whatever survives that cut to make sure the investment makes sense.

Monitor Pricing

Inflation takes a toll, so every association should have a system to regularly update its pricing. Maintain an annual calendar indicating when departments should review prices. Items that sell well should be sold at the highest price a member or customer would be willing to pay. Items that don't can be bundled, reduced in price, or unloaded. Be aware of products' full cost; in almost all associations the major cost is personnel.

Check if the market offers something similar to your product or meeting. If yours is of higher value, you can set your price higher, but it must be set with the market in mind. Unique products or services can carry the highest markup.

Meet Member Needs

One theme I kept returning to in this column was a simple one: The most successful products fulfill a definite member need. Knowing what members need to succeed and providing it is the surest path to success.

Your board, unfortunately, is not the best source for this information. Train staff who have regular contact with members to ask what they need. Surveys, particularly phone surveys, can also help. Ask often: The world your members face is changing quickly.

Andrew S. Lang, CPA, FASAE, is with LangCPA in Potomac, Maryland. Email:

[This article was originally published in the Associations Now print edition, titled "Parting Words."]

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