Why Hire an Association Management Company?

The association management company industry is more than 110 years old.  Today, there are over 600 AMCs worldwide that collectively manage associations ranging in budget size from $50,000 to $16 million and representing more than 3 million members.  Regardless of the size, industry, and membership type of your association, there is likely an AMC that has experience with an organization like yours.

Organizations that have chosen to use a full-service association management company realized that they did not have the in-house expertise, experience, time, or other resources necessary to accomplish their goals. They also realized that maintaining an office, a full-time staff, the equipment, and insurance was not the most efficient use of their organization’s money. After all, these types of organizations exist to service their members, support a cause, or influence government and policy-making bodies.

More and more associations are turning to AMCs for full-service management. It can be a win-win situation: they lower their expenses, turn over the administrative tasks to qualified staff, improve membership services, and then turn their focus to improving their profession.

Most associations work with limited resources. They cannot always hire the people most suited for a particular task or project. For example, an association with a small or volunteer staff may not have the expertise or time to plan a full-fledged trade show or negotiate with hotels and exhibit halls. An AMC that has a competent, experienced meeting planner can more effectively serve their members through events, free the board to pursue the association's mission, and create more revenue through their events.

A retired board member, a member or a member’s secretary will almost certainly always know your industry and its concerns better than AMC personnel. However he or she is not likely to have the experience most associations need to conduct the major business of the association.
To get the best of both worlds, many associations contract with an AMC for day-to-day management, and use their elected leadership to set association policy and standards. It’s the job of the AMC to run the association based on those policies and standards.

Can Your Association Save Money?
Studies show that the costs of maintaining an in-house staff, offices, and equipment can eat up more than half - and sometimes more than two-thirds - of an association's total annual budget!
Because the association management company will have the responsibility of payroll, benefits, taxes, insurance, computers, copiers & fax machines, property maintenance, utilities, and a host of other expenses, the association saves on a large portion of its overhead. AMCs are able to reduce your overhead costs via a system of shared resources. Depending upon the number of services needed and the current overhead expenses, an AMC can often cut an association's overhead costs by 25-40 percent.

How do Association Management Companies Charge?
Fee structures vary from company to company and client to client. However, here are a few samples of AMC fees and charges.

Basic Management Fee
The AMC and association usually agree on a contracted set of tasks or duties to be performed by the company, and the association pays a set monthly fee for those services.

Hourly Rates
The association may pay an hourly rate for projects that are outside of the tasks detailed in the agreement. This is especially true of one-time projects such as a website (re)launch, rebranding, prodcut development, or 50th anniversary event. A few AMCs charge an hourly rate for all tasks they perform for their clients (instead of a basic management fee).

Project Fees
For large projects that fall outside of the scope of the management agreement, the association and AMC may agree in advance on a set fee to be paid just for that project.

Other Fees
You may choose to pay a commission for each new member as an incentive for membership development, award a bonus for sold out shows, or you may share the profits of a large event to reduce your risk. (If it doesn't make money, you don't pay anything.) There are many such flexible arrangements.