Your club’s reason for being, its ‘purpose’ or “objects’ in your constitution, is not about making money. However, without a secure and diverse revenue stream, no club will have the resources to weather unplanned setbacks, be able to deliver that purpose and fully support its members in the long term.
Remember, ‘not for profit’ does not mean ‘for loss’. How much more could your club do if you had more money to invest in activities each year – or at the very least, not waste time and money chasing membership fees?
Cash equals capacity, so let’s apply some simple business strategies to give your club a reliable and growing financial base from which to build your club’s programs.
Keep in mind that as a member of the management committee, you are accountable for the club’s financial health so you, not your members, decide how fees are set.
Did you know? Your duty is to prevent insolvent trading, meaning an organisation is not able to pay its debts as and when they fall due. To help prevent this from occurring, keep yourself informed about the club’s financial position at all times, including how it is tracking against its budget.
It’s likely that the largest source of regular income your club has is its membership fees. Too many clubs strive to keep their fees low, which undervalues the benefits to members, undercuts the club’s ability to actually work for those members and sends a clear message about how the club values itself.
The aim is to be seen as giving value for money, not as being ‘cheap’.
While your members are not cash cows to be taken advantage of, nor should you have to support low fees by relying on volunteer time or short-term/one-off grants. If this is the case, your club is not financially viable!
Did you know? Your membership fees are likely to be your largest regular source of income, so make sure you set them right.
Fixing the right level for your fees is tied to understanding your club’s true value – including your fixed assets, such as your facilities and equipment, and your intangible assets, such as the contribution of your volunteers. Add to this your ongoing expenses like maintenance, affiliation fees, insurance and lease fees, and you’re looking at a considerable financial base of operations.
Clubs offering top-notch services at low fees might overburden volunteers. On the other hand, clubs offering high-quality services at higher fees are usually more sustainable. Clubs in economically strained communities might need to set lower fees but can manage their service levels to avoid burning out their volunteers.
A useful tool is the Member fee calculator. From here you can set your membership fees, based on the number of members you currently have, and in a way that recognises your club’s value.
Once your management committee has set membership fees, think about how to collect them more consistently and efficiently. Too many clubs carry ‘non-financial’ members – those who either are habitual late payers or perhaps don’t pay at all. This is unfair to those who do pay their fees on time and sets a precedent that is always going to cause cash flow and governance issues.
If you don’t already have one, consider formalising a membership fees policy based on the rules in your constitution that will help your club deal with non-payment of fees. Remember, it’s not personal, it’s business and it will save a lot of time when properly enforced. Your club cannot have a non-paying member – no payment equals no play…
Paying your membership fees should be easy, quick and straightforward, so if it currently isn’t all of those things put processes in place to remove any barriers.
Here are some suggestions.
Membership fees should be reviewed by the management committee each year, ideally as a part of setting the new year’s budget. No one likes fee hikes but a small annual increment, perhaps aligned to CPI, is always preferable to larger increases every couple of years. After all, your club’s expenses also rise each year, so revenue also has to rise to keep the club active.
Did you know? Switching to digital payment methods like EFTPOS, bank transfers and credit cards speeds up transactions and creates a digital record, making it easier to track and manage your club’s income. By reducing the amount of cash handled, you eliminate the need for time-consuming cash counts, secure storage and bank visits. Digital payments help you minimise risks associated with cash handling, such as loss and theft, saving your volunteers’ time, enhancing financial transparency and boosting your club’s financial security.
UQ Sport reinvests all profits into services, facilities, and programs, and is supported by funding from the Student Services and Amenities Fee (SSAF) to benefit UQ students.
UQ Sport Ltd is a division of UQ Holdings.
