Local chambers of commerce are some of the most important organizations within the private sector. Chambers serve a community’s enterprises with a dual-purpose role of marketing the specific region — as well as individual businesses — and serving as the voice for those entrepreneurs when it comes to matters of local, state, and national public policy.
Most small businesses, working on tight budgets and even tighter schedules, find it difficult to do those tasks solely and effectively on their own, so these business cooperatives, which can be found in most any community across the country, provide immeasurable benefit to their members.
To do those tasks and do them well it takes a considerable amount of money. Mass marketing via local newspapers, national tourism magazines, broadcast media, and the Internet is not cheap. Advertising fees, trade shows, networking, and personnel costs add up in a hurry. Even policy development and study is not inexpensive, as many chambers totally devote a staff member to government relations.
To cover those myriad costs and still keep membership affordable, most chambers of commerce pursue alternative revenue streams.
Among the most common is the offering of health insurance. Pooling together the buying power of all of their members, they can get insurance at much lower rates than their individual businesses would be able to on their own. So, the law firm or doctor’s office in town, each with just a half-dozen employees, might be able to buy insurance at a rate comparable to that of the factory down the street that employs 200 people and deals directly with an HMO. This benefit — thus membership — is typically extended to the community at large (not just businesses) as both a service to the community and a means to secure more revenue from membership fees of those folks (like families) who might not have any need for the chamber’s other services. That source of income, which for many chambers accounts for a third or more of their clientele, is significant and it keeps overall membership fees down while affording chambers the funds to focus on doing what they do best — policy and promotion.
Unfortunately, that standard practice looks to be on its death bed. And, so do many chambers of commerce.
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