Chamber Members Not Paying? Fix Your Cash Flow Now

Chasing down membership dues is a universal headache for chamber professionals. But in addition to being time consuming, it can cause serious cash flow problems. You may budget on a certain amount of revenue coming in each month and when members are late, you’re missing out on it.

But it’s not just a matter of them being lazy or forgetting.

With many businesses facing economic uncertainty, late payments are becoming increasingly common. So how do you maintain a healthy cash flow without alienating your members?

No More “I’ll Gladly Pay You Later”

Let’s explore some proven tactics and advice from seasoned chamber pros to help you turn late payments into on-time checks:

Proactive Prevention is Key

To combat forgetful members, try these ideas:

• Early Engagement (Deb Neuman): Don’t wait for invoices to become overdue. Reach out to members 90 days before their renewal date to check in, highlight the value of their membership, and address any concerns. If they’re not seeing the value, there’s still time to turn it around. Kmart used to email members of their savings club a purchase history for the year so they could see how much membership saved them. Amazon does the same with Prime (savings shown on member accounts). Showing the value can help remind members what membership means to them.
• Build Relationships (Jamie Rankin): Focus on fostering strong member relationships throughout the year. Celebrate their successes, offer support, and make them feel valued. This strengthens their connection to the chamber and makes renewing a “no-brainer.” An email nurture campaign over the course of the year can also help with periodic touchpoints if you’re short on time.
• Showcase Value (Lynette Hearrell): Regularly demonstrate the value of membership. Offer personalized consultations, highlight member benefits, and showcase how the chamber is helping them achieve their business goals.

Streamline the Payment Process

Don’t make it difficult for them to give you money. Friction makes for a good story but not a payment portal.

• Offer Multiple Payment Options (Belinda Goody): Provide convenient payment options like online payments, ACH, and credit card processing to make it easier for members to pay.
• Incentivize Early Payment (Scott Firle): Consider offering discounts or running contests for members who pay their dues promptly during renewal periods.
• Automate Reminders (Michelle Barefoot): Set up automated email reminders at 30, 60, and 90 days to keep payment top-of-mind.
• Create Auto-drafts. If you offer a monthly membership plan, you probably already auto-bill on the renewal date. Consider doing that for annual dues as well.

Communicate with Empathy and Clarity

Your members may not have paid because they can’t.

• Understand Their Challenges (Heidi Scrivo): Recognize that late payments are often not personal. Many businesses are facing financial constraints. Approach conversations with empathy and understanding. Focus on how you might both win.
• Set Clear Expectations (Nancy Pruden Keefer): Establish a clear collections schedule and communicate it to members. Be firm but fair about deadlines and consequences.
• Document Everything (Kristin Johnston Weiss): Maintain detailed records of invoices, payments, and communication with members. This protects both the chamber and the member.

When to Draw the Line

Should members be dropped immediately after their payment is due or should you give them a grace period? These chamber pros rang in with what they do:

• Implement a “Drop” Policy (Michelle Barefoot, Angie Woker Hibben): While you want to be understanding, it’s essential to have a policy for dropping members who consistently fail to pay. This protects the chamber’s financial stability and ensures fairness to paying members.
• Focus on Committed Members (Kristin Johnston Weiss): Invest your energy in members who are actively engaged and committed to the chamber’s mission.

Navigating the ACH Dilemma (Belinda Goody)

Many chambers take ACH in lieu of credit card payments because it offers a convenient way of paying without the transaction fees. But is it without headaches? Not always. Here are a few things to keep in mind:

• Address Outdated ACH Rates: Communicate clearly with members about rate increases and offer a simple process for updating their ACH information.
• Consider Alternatives: If ACH is causing more headaches than it’s worth, explore alternative payment options or consider phasing it out altogether.

However, if you offer a monthly payment, you must have some sort of autodraft in place, whether that’s via credit card or ACH.

So how can you do your best to ensure you get the largest percentage of member payments on time? Try these best practices:

Chamber pros can employ several strategies to ensure timely payment of dues beyond simple reminders:

1. Offer multiple payment options, including credit cards, bank transfers, PayPal, and mobile payment solutions, to accommodate member preferences and increase payment success rates.
2. Implement automated systems for invoicing, payment reminders, and digital receipts to reduce administrative burden and improve accuracy. Check out what your CMS is capable of or use a platform like QuickBooks to create greater efficiencies.
3. Provide incentives for early payments, such as time-sensitive discounts or special promotions, to create a sense of urgency.
4. Introduce flexible payment plans, especially for members facing financial constraints, to help retain them while resolving payment issues. They may be having problems with cash flow too. If you have a system that will send invoices or charge on a selected date, you could allow members to choose the bill date much like credit card companies do. For instance, the 15th may be a better date for cash flow for them than the 1st. Giving them that flexibility may allow them to pay on the due date versus drawing it out a few weeks.
5. Establish clear policies for late payments, including grace periods, late fees, or suspension of member privileges.
6. Offer tiered membership levels with different pricing options to cater to diverse business needs and budgets. Allow a struggling business to drop to a lower tier.
7. Consider shorter billing cycles monthly instead of annually to ensure a steadier flow of revenue.
8. Consolidate sponsorships, advertising, and other opportunities into membership tiers, allowing businesses to make a single annual payment.
9. Conduct regular data analysis of your membership base to ensure fees align with member demographics and financial capacities.
10. Maintain open communication with members, listening to their concerns and working together to find solutions that benefit both parties.
11. Enforce payment policies consistently to avoid setting precedents that may encourage late payments.
12. Offer member scholarships through sponsors for businesses facing temporary financial difficulties. During COVID some cities subsidized chambers to be able to offer member scholarships until things reopened.

Collecting dues efficiently is crucial for any chamber’s financial health, but it ranks up there as one of the worst parts of the job. No one wants to chase money.

By implementing these strategies, you can create a more streamlined and effective payment process while maintaining positive relationships with your members. You offer a great value but it’s important for them to realize it. Don’t put the onus on them to do so. Share over and over the value you give in the way that is personalized to them.