There’s an old saying about there being power in numbers.
As a small business you may feel like you don’t have the power or influence of the big boys, nor do you have the expansive network of allies they do either.
And that’s why they created trade organizations.
Most industries where you can sell a product or service has one; there are more than 7,800 trade organizations listed in the Directory of National Trade and Professional Associations of the United States. Further, according to American Business Magazine 85 percent of small business failures happen to businesses that don’t belong to trade organizations.
So it might be a good idea for your small business to join a trade organization, right? Then again, it might be more cost than it’s worth. So let’s take a look at the obstacles and advantages to trade associations, so you can see if joining one is the right move for your business.
The Cons of Joining a Trade Organization
Cost – Nothing worth having in life comes for free, and trade associations are no different. And though the dues might not be terribly high, that monthly payment can add up if you join more than one.
Time – There wouldn’t be much point in paying all that money for an association you never do anything for, now would there? And as a small business owner, your time is incredibly valuable and time spent going to and from – and attending – association functions might put a crimp in your business.
Forced Interactions – Just because you share an industry with people doesn’t necessarily mean you like them. And while much of what trade associations do is professional, there’s a certain level of schmoozing that’s expected as well. If small talk and happy hours aren’t your thing, this might be a drawback.
Information Overload – Like you didn’t already have enough people calling and emailing, a trade association may inundate you with announcements, event invites and calls to action. Which, if you’re busy, you’ll probably ignore, and continue to get little for the monthly dues you pay.
The Pros of Joining a Trade Organization
Networking Opportunities – Networking is the most obvious, and the #1 reason most people cite for joining a trade organization. Though many there will be your competitors – and it’s never bad to have close tabs on them – many are also vendors and other people looking to make meaningful business contacts in the association.
Shared Knowledge – Nobody knows how to succeed in your industry better than other people in your industry. And chances are no matter what problem you’re facing, somebody else has faced it before. Learning from their experiences will help you avoid some pitfalls that others have made, and give your business solutions you probably hadn’t considered yet.
Perks and Free Stuff – Most trade associations have resources only available to their members like research materials, tax advice, legal help and volunteer consultants. Oftentimes, there are also fun association events and discounts to business conferences and seminars available.
Purchasing Power – If you run a retail business, the purchasing power offered by many trade organizations might be your biggest draw. You ever see that IGA logo above your local, non-chain grocery story? That’s for the Independent Grocers Association, a trade group that allows small stores to buy with the power of the big chains and stay competitive. This works the same in many industries and can be a huge leg up for you.
Political Clout – Not that anyone who’s watched half an episode of “House of Cards” thinks otherwise, but a lot of government decisions are formed by lobbyists. And unless you’re Wal-Mart, your company probably can’t afford its own lobbyists. A trade organization, however, often does have people in Washington and your state’s capital to lobby on your behalf.
Enhance Your Business’ Reputation – Joining a trade organization doesn’t automatically mean your business is on the up and up, but it’s something you can put on your door to make yourself attractive to customers. Also, if the association is reputable, it’ll let others within the industry know that you’re a relevant part of the industry, while enhancing your business’ reputation and credibility.
Explore New Ventures – Along with potential business referrals from inside the organization, you may also meet other small business owners with whom a joint venture makes sense. These kinds of business partnerships are what trade organizations were made for, and an invaluable asset.
All this said, you might find your business can do just fine without joining a trade group. But if it’s something you can afford both financially and time-wise, it’s rarely a bad decision. And should an exciting new venture spring up with your new trade organization friends, and you need some extra working to get it going, BFS Capital is always here to help.