Questions and answers

Of course, the entrepreneurs of a chamber Nucleus have the liberty to found a sector association. The point is whether the chamber and a project should support this or try to hinder it.

Generally, try to avoid the creation of mostly tiny – and consequently inefficient – associations. Instead, improve the existing business institutions by making them bigger (members, financial means, staff) and increase their performance concerning services and lobby.

The arguments:

In many countries exist
- business chambers, representing the enterprises of a geographic unit;
– sector associations, representing the enterprises of a sector.

Their tasks and objectives are in great parts similar, but there are also some decisive differences. – see E50_Cha_Tasks_Structures.ppt

Such a chamber – association system works successfully, if both organisation types get enough members and income from membership fees and services to finance professional staff. This requires that a big part of the entrepreneurship participates in both institutions (paying membership fees twice).

The lobby power of a chamber or association bases on the “Law of the Big Number”. The more the entrepreneurship is divided in small organisations the lower is the lobby power and the easier is life for public administrations and governments.

As members of a bigger chamber Nuclei can use the chamber’s reputation and lobby capacities in favour of their sectors. We have many successful examples for this.

When the members are mainly small enterprises in most cases an association needs a minimum of 300 to 500 members (and even more!) to be able to finance two or three qualified employees, an office, equipment, transport etc. With few members and no employees the association remains normally on the level of a “Business Club”.
The idea of the Nucleus is, to use the umbrella of a bigger chamber (office, infrastructure, staff), so that also smaller groups of entrepreneurs have access to professional services. The focal point is that the entrepreneurs do not have to care about the administration and organisation of the institution. Instead they can concentrate fully on their business matters. When these entrepreneurs start their own association, much of their time and work capacities are absorbed by formalities, financial and organisational subjects.
What are the reasons for the foundation of an association? Or, Jordi’s question: what do the entrepreneurs get from an association what they do not get from the chamber Nucleus?

If the reason for the foundation of an association is a conflict with the chamber (poor performance and services, poor treatment of the entrepreneurs) then the solution is more to improve the chamber and not to leave the chamber.

We know some cases from Brazil and Sri Lanka that Nuclei quit the chamber and started an association (or considered to do this). The result was always the same: after three months the entrepreneurs had neither a functioning association nor a functioning Nucleus. They lost in a very short time for what they had worked for years.

It is not necessary to tell the Nucleus entrepreneurs that it might be a bad idea to found an association. It is better to show the consequences through questions:

– How many members will the association have (calculated in a realistic way)?

– How much membership fee will the entrepreneurs pay?

– Will they really pay the defined membership fees?

– What infrastructure, staff, administration, services and lobby will the association be able to finance out of the total membership fees?

If the entrepreneurs know to calculate a little bit they will observe that the figures do not fit together and that as association they will get less than as Nucleus in a chamber.

The objective of a project is the promotion and development of a professionalised chamber and association system – and not of “Business Clubs”.
But: bring me 1.000 SMEs of one sector who are ready to pay 10 €membership fee per month or 100 medium enterprises paying 100 € / month, that we start the sector association right away.

22/02/2009 - MueGlo