Thursday, February 9, 2012

Converting underused products into profitable ventures for associations

USA Today and the AARP Bulletin both ran news stories last week about funeral homes
finding new life by hosting other events  such as weddings, meetings and other events.

Citing a 2010 association survey, the articles noted that 10% of funeral home owners said they owned or offered a community or family center in addition to traditional funeral facilities. Many said their wedding planning business is growing. The story featured one funeral home who hired a “special events coordinator” who doubled as a wedding planner and who grew the business.

My first thought was: great PR created by the National Funeral Directors Association. They obviously “placed” this story in multiple media outlets to help benefit members of their industry.

My second thought was: what unused services or benefits do associations have that could be converted into a valuable member service or a profitable product?

For example, is your convention and/or trade show fully used?

  • Several associations have found success creating joint conferences with noncompeting associations. The Ag Media Summit and Commodity Classic are two great examples of this. The results have increased attendance and profits for the participating partners.
  • For smaller associations, it might be possible to share office space and staff (receptionist or other “common” functions). 
  • If your organization has a very specialized (magazine production, social media, etc.) but underutilized staff, it might be possible to offer them to associations as an agency-like profit center.
Yes, such ventures may lead to UBIT (Unrelated Business Income Taxes) ... but as my father used to say “you only pay taxes when you are making money.” So, assuming the UBIT does not become excessive and jeopardize your nonprofit status, you should get a net gain from such ventures.

With the continuing rapid changes in the environment in which associations operate, taking time to look for opportunities to profit from underused capacity could advance your mission.

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