Trade associations and nonprofit organizations may be the next casualties of a new world economy focused on greater worker productivity and greater reliance on the Internet.
“The things that trade associations offered over the years are things you can now get in many different ways,” said Julie Metsker, president of Professional Administrative Resources LLC, which provides management and support services to nonprofit trade associations. “In the next three to five years, we’re going to see more consolidation and some may drop away.
“Even larger trade associations like chambers of commerce are having some struggles.”
Metsker attributes the challenging times to employees who are often doing the work that two or three people used to do and employers who want to make sure there is a value to them in the services provided by such organizations. She said many of the educational services these organizations provided are now readily available on the Internet.
“Employees have less time to devote to organizations like these and they are very cognizant of the time employees spend away from the office and their jobs,” she said.
Joani Gill, an agent with New York Life who serves on the West Michigan World Trade Association’s board of directors, said the nonprofit has hired Metsker’s firm to help it regain some of what it has lost in the last couple of years.
“In the last two to three years, we have struggled to get people to come to our meetings, and when we make the effort to get a speaker there, three or four days before the event we may only have 10 people signed up,” Gill said. “That’s taxing on the board members.”
Despite the fact that the majority of the WMWTA’s membership have heavy trade-related travel schedules, they have told Gill that the organization is important to them.
“Although they may be committed in spirit, they can’t make it to meetings and support the board and organization,” Gill said, adding that board members also are feeling the time crunch.
“Last year we had a strategic planning meeting off-site with board members. We discussed where we are and where we wanted to go, and we all felt that the status quo is not where we wanted to be,” Gill said. “We discussed merging with another organization that might want to take us under their wing.”
But nothing happened after the discussions.
Another group considering a potential merger is the U.S. Green Building Council of West Michigan, which has 501(c)3 or nonprofit status, said Renae Hesselink, vice president of Sustainability for Nichols Paper headquartered in Muskegon. The trade association has another Michigan chapter in Detroit. The West Michigan chapter has hired Metsker to provide administrative support that its volunteer membership no longer has the time to do.
“We’re not hurting financially, but we probably can’t grow much more right now because we need administrative support,” Hesselink said.
Hesselink said her trade association was on a fast-track growth path until the economy took a hit and the construction industry “fell apart.” She said membership decreased from more than 300 members to a little more than 200 people. Membership fees and revenue from education programming are the main sources of the organization’s income.
“In 2010 we were having regular monthly calls with our national organization to explore whether it made sense to merge,” Hesselink said. “Both of our chapters mutually decided there were too many current issues and programs to pull this off right now.”
While Hesselink said it makes sense to merge, she and other members have concerns about losing their identity because the Detroit chapter is much larger.
Discussions about mergers and the future of nonprofits is an ongoing discussion, said Thom Andrews, director of ONEplace in Kalamazoo. ONEplace – which stands for Opportunities for Nonprofit Excellence – is a one-stop resource for about 450 nonprofits in Kalamazoo County.
“The environments in which we work are never static,” Andrews said. “Even 20 years ago, folks were dealing with these same issues in different ways.”
Gill, Hesselink and Metsker all agree that issues such as an organization’s relevance and its ability to change as the needs of its members change are key to long-term survival.
“Trade associations and charities have to make their case for the return on investment,” Metsker said. “We’ve been seeing for the last two years (that) organizations (are) asking how they can remain relevant and what’s going to draw members and a return on investment.
“They’re focused in on the idea of how do we remain relevant and if we can’t, what’s going to happen.”
Andrews said sometimes it just makes sense to disband or to merge with an organization providing similar services. This happened with the Free Clinic in Kalamazoo, which was operated by the First Presbyterian Church.
The clinic, which opened in the mid-1990s, provided free medical and dental care to needy residents. In 2010, officials with the clinic voted to dissolve the organization and turn operations over to the Family Health Center where they had visited earlier.
“Some have expressed sadness at the closing of the Free Clinic and the end of 18 years of service that filled a gap in medical and dental care in the community,” Rick Russell, chairman of the clinic’s board of directors, said in an op-ed that appeared in the Kalamazoo Gazette. “(We) see it differently: It is a good thing the community is now in a position to formally accept the responsibility for the medical and dental needs of the uninsured members of our community through the Family Health Center.”
“I think the basic formula for any nonprofit is to define what their mission is and the impact they are making on their particular audience and the community at large,” Andrews said. “Everything else the organization does is subservient to that mission.
“The services need to change to meet the needs of the audience.”