Did you know that approximately 85 percent of all business failures occur in companies that are not members of their trade associations? Statistically, of course, more companies don’t belong to trade associations than do belong. But that tidbit, from American Business Magazine, made me sit back and think for a while. I can name only one company that had been a member of the Tag & Label Manufacturers Institute (TLMI) that folded over the past two decades. Probably there are more. Yet over the years we all have learned of many non-member companies that did go under.
This is not to suggest that membership in an industry trade group is an insurance policy against collapse. Far from it. Rather it is more like investing in a fund that yields a healthy dividend every quarter, except that the payoff is in business knowledge and expert advice.
Many of us have enjoyed the gatherings of the Flexographic Trade Association, which routinely draws more than 1,000 people to its annual forums. TLMI and FINAT, the international label trade organization based in Europe, produce memorable, rewarding events.
Dscoop, whose members are users of HP Indigo technology, held its ninth conference this year, attracting more than 2,000 people from the printing industry. Must be some reason so many folks attend, don’t you think?
Yet it is a perplexing marvel to hear business owners explain why they don’t belong to TLMI, or – and this is even more astonishing – why they don’t visit Labelexpo in Chicago or Brussels. Here are a few of the reasons they give for not joining a trade association:
• “It’s all run by an old-boys’ group.”
• “That stuff is for the big companies.”
• “They look at your books. I’m not opening my books for anyone.”
• “It’s too expensive, and they meet at luxury resorts.”
• “All they do is play golf.”
• “They’ll try to steal my customers.”
• “If my customers aren’t there, why would I want to be there?”
• “Who has time for that?”
Yes, the TLMI crowd does play a lot of golf. In the past there were some “old boys” in leadership positions, but those days are over. These are the days of Lean Manufacturing, in which every minute and every move count. And just for the big companies? Hardly. Plenty of TLMI member companies have revenues under $10 million, and they laugh and play golf with the $100 million guys and gals.
They don’t look at your books. Every year TLMI produces a ratio study, an exclusive benchmarking analysis only for members who wish to participate. Each volunteers data on finance, productivity, profitability and other economic strata. The data is collected and processed by an independent third party who does not share it with anyone inside or outside the organization. The participating member gets to examine his or her data alongside benchmarks distilled from other participants of a similar size. And that’s it.
As for stealing customers, I have never heard any member accuse another of that practice. People who voice that concern reveal a mindset of suspicion. Maybe they’ve been stung. Some converters won’t enter label competitions because they are certain that everyone who sees that they print labels for Lululemon is going to rush right out and offer a better deal to the client. I’m not making this up.
I met with one converter who waved away any suggestion of industry involvement. “I’m an active member of the chamber of commerce in my city. My community is important to me.” A noble cause, without a doubt. But also free of competitors, probably.
Networking and camaraderie. Those are among the top reasons people join and remain members of a trade group. Meeting with colleagues – yes, they are competitors – can result in a beneficial exchange of ideas covering every aspect of business. Association members work on committees to come up with solutions to problems that affect everyone in the industry, in areas such as environmental health and safety, technology, government and regulation, and marketing. The major meetings – yes, at nice resorts – feature business speakers with useful messages. At the evening events you can earn a PhD in networking.
Trade show deniers
Certainly it is startling to hear someone pan the idea of attending Labelexpo. It’s too expensive, we’re too busy, they get you into their booth and try to sell you the moon and stars, we don’t need any new equipment, we’ll buy it used.
Clearly those with that attitude haven’t taken the time to investigate the reality. Labelexpo is the greatest networking event of the year for label converters and suppliers. It is where business relationships are made, bloom and are reinforced. (An event like Dscoop is different, because all attendees have digital printing equipment and already are doing business in the 21st Century. No luddites there.) It is where every piece of technology, familiar and new, is on display and running. It is where the label company owner and members of the team get ideas that might inspire and attract clients and result in profit and growth.
It’s great to encounter the heads of the large converting companies on the trade show floor. They obviously care about the present and the future of their businesses, and are keeping up with trends. But it’s also a bit odd that they don’t bring with them the people who are actually going to use the stuff that they are thinking of acquiring, be it a press, workflow software, a rewinder or an anilox roll cleaner. Many do. It’s great to see a team from one company that includes the top boss, a manager and a press operator. That leader, it is obvious, respects the opinions of his employees in a big way.
We know what technology is up to: It is moving forward at a pace that startles us, clamoring for our attention in a workday that already is crowded with needs. How does one take it all in? Try going to Labelexpo, if you haven’t recently. It’s all on display there, and people will explain it to you. Digital this, laser that, all of it. Talk with your people and make a list of the things you need. Set up some appointments in advance with vendors to explore what they’re doing. Then pack your team onto a plane and spend three days in Chicago, or better yet, four days in Brussels. If it’s used equipment you prefer, go anyway. The purveyors of pre-owned stuff have booths at the show, too.
There’s an old expression: You have to spend money to make money. Whether it’s true is debatable, but it’s worth considering that the converse – cutting expenses improves profitability – has pretty much been shown to be counterproductive. Investing in three or four days at an association meeting or a trade show will not be a waste of time and money if you are truly concerned about the future of your business.
It might be time to shrug off the yoke of skepticism and spend a few days with folks who know intimately what you do for a living. These people don’t want to hurt you. They want you to thrive, because your success benefits them and the whole industry. And who knows, maybe some day they’ll call you with an offer.
The author is president of Jack Kenny Media, a communications firm specializing in the packaging industry, and is the former editor of L&NW magazine. He can be reached at firstname.lastname@example.org.