Part 5 of series on small business networking groups, Randy Gordon. This time, we dug deep into home-based businesses, networking groups and the hunger for human connection.
Randy: I want to go back to something you said about home-based businesses and tell you that we do have a pretty good share of home-based businesses. We probably have, out of a thousand members currently, at least 150 home-based businesses. They’re in a big pickle in those home-based businesses because many of them start their business on a shoestring, and they don’t have very deep funding, and they’re out of business before they even have a chance to renew. But we do have a special rate for those home-based businesses.
So we do cater to many of those through a group called Women’s Business Council — we have one of the few chambers of business that has a Women’s Business Council that is made up of mostly women. There’s a few men. But it’s for micro-business owners, home-based business owners. So that’s a great step for a home-based business person who’s doing some writing out of their home, or maybe they’re doing PR out of their home, or maybe they’re Mary Kay reps.
And so a lot of those home-based business ladies that are members that join — in our case, it’s $395 — they get plugged into Women’s Business Council, and that’s been pretty successful for us.
I think the home-based business movement has helped chambers, but not a lot of chambers are really aggressively going after those home-based businesses because they don’t really want them. Whether Seattle Chamber of Commerce has a special rate for home-based businesses, I doubt it.
But we feel there’s a niche there because we believe more and more people are going to work out of their home. Let’s face it: you could do work practically anywhere on the face of the earth and be successful if you’ve got the right electronic equipment.
Nate: Well…[laughs] Now, I can talk about that topic for hours and hours. The electronics is part of it, but I’ve spent a lot of time training my clients to handle my remote nature. It’s taken building up — I mean selling it when you’re remote is a lot harder. Building trust when you’re remote is a lot harder.
So I actually go on road trips and actually meet clients face to face so that the next time we do our remote training session or a remote meeting or doing work remotely, that they’re still feeling comfortable about it. That’s something for me: up until this past year, I’ve steered clear of most networking groups because of that home-based business aspect.
But understanding the community of networking groups and how they function together, I think that I have a lot to learn in that particular space. Sometimes, I have to remind myself that the chamber and Rotary—all these places—they’re actually businesses too, and they have business models, and they’re delivering a service that I’m paying for. I’m still trying to get my hands around that one.
Randy: Actually, the one thing about it is I’m sure there are people out there that are making a decent living working from their home remotely, and they maybe never see anybody. But I think that that is much more difficult. I think regardless of where we’re going in the future from the electronic age, I don’t think you can ever, ever take the human contact completely out of the equation.
I’ve been in Rotary 32 years, and I can tell you that the optometrist I go to, I met through Rotary. The guy who did my throat surgery was a Rotarian that I sat next to and had lunch with and got to know. So the guy operating on my throat, I knew through Rotary, and I was more comfortable with him doing that. Plus he had a stellar reputation.
And the kind of people that join Rotary are usually the best of the best in their industry. I remember when I decided not to have kids anymore, and I had my tubes tied. That was a Rotarian who did that. For the first time ever last week, I went to a podiatrist—first time ever. I’m 65 years old. I went to a guy who’s in Rotary.
So what happens is that just absolutely—that human contact and getting to know someone—maybe you knew them—like this podiatrist, I’ve known this guy for 20 years. Now, I don’t know him well, but I’ve sat next to him, I’ve had hundreds of conversations with him, and I’ve never used his services until I needed it. But when I needed it, the first thing I thought about was my Rotary roster, which is listed by classification, by medical groups, and we only have one podiatrist in the club. “Oh, I kind of forgot what the guy did.”
So that human contact is important. You can’t take that completely away. But I think what’s happening today is the chamber has got to be like 80% electronic and 20% human contact because we’ve become a society of skimmers and glancers.
I try to read three newspapers a day. I get hundreds of emails every day. I try to go through them every day. I’m responding from my phone that I’m talking to you now—my Samsung. I’ve got my iPad in the car, and sometimes, I’m responding to that or my laptop at home or my laptop sitting on my desk. We are just absolutely bombarded by electronic medium messages, not to mention the hundred texts that I get a day.
Our chamber’s on Twitter, but I’m not. I can just barely handle what I’m doing now from an email point of view, from a text point of view and try to read three newspapers a day. It’s a world that’s fuzzy and moving fast. I love this quote from a Putnam Investments commercial that says, “Just when you think you understand a situation, what you don’t understand is the situation just changed.” I’m just trying to keep up.
About Randy Gordon
Randy Gordon was named President/CEO of the Long Beach Area Chamber of Commerce in April 1994. He is a 1988 graduate of the U.S Chamber Western Institute for Organization Management at San Jose State University, former instructor at the Stanford Institute, a past member of the Board of Regents of Western Institute, a 1993 graduate from the U.S. Chamber’s Academy at Notre Dame and is currently a trustee for the National Board of the Institute. He is a 1995 graduate of Leadership Long Beach. He is a past president of the 330 member Rotary Club of Long Beach and has 29 years of perfect attendance.
Part 4 of our series on small business networking groups, Randy Gordon answers who is *not* a good fit for the Chamber.
Nate: So what would not be a good fit for the Chamber, and why?
Randy: Well, I think small business owners who have virtually no employees are a very difficult fit. Let’s say someone’s a beauty salon owner, or someone basically may have one employee. I think any small business owner who doesn’t have a lot of employees and has maybe one or two, that can be a difficult fit because once again, let’s get back to “How do we show value to a member that has no time to participate?”
So we can’t get that small business owner to go to a networking opportunity so they can see value. We can only do so much for them if they never leave their store. We list them in our newsletter; we list them in the annual referral guide and membership directory. And sometimes, we give every member a free email blast. So once a year, when they renew, they get a free blast.
So we can do a little bit electronically, but it’s a lot about relationships and building relationships. People want to do business with people that they know, they’ve met — these people are interesting. “I just met this new vet last week. I really like the guy. And you know what? The next time I have a problem with my dog, I may try that guy out because I really like that guy.” So I think it’s a bad fit if you can’t get out in the community.
About Randy Gordon
Randy Gordon was named President/CEO of the Long Beach Area Chamber of Commerce in April 1994. He is a 1988 graduate of the U.S Chamber Western Institute for Organization Management at San Jose State University, former instructor at the Stanford Institute, a past member of the Board of Regents of Western Institute, a 1993 graduate from the U.S. Chamber’s Academy at Notre Dame and is currently a trustee for the National Board of the Institute.He is a 1995 graduate of Leadership Long Beach. He is a past president of the 330 member Rotary Club of Long Beach and has 29 years of perfect attendance.
Part 3 of our series on small business networking groups, Randy Gordon discusses which types of businesses benefit most from the Chamber of Commerce.
Nate: What category of business is the best fit for chamber membership? Who gets the most value out of it if they attend? And what category of business might not be a good fit for chamber membership?
Randy: That’s a very good question. Okay. First of all, every small business retail person or restaurant should be a good fit because they should be able to take advantage of our services more than anybody else if they get out and go to events and networking.
For example, if a restaurant owner hosted events at the restaurant for chamber members, if they hosted an after-five mixer — something like that — or they hosted a lunch, the restaurant owner should really be a good fit. The challenge is getting a restaurant owner out of his restaurant for a breakfast, lunch or dinner at another place.
Nate: [laughs]
Randy: That’s the challenge. Most of our events revolve around a meal. Almost all of them revolve around a meal unless there is something like a mixer where there’s alcohol and hors d’oeuvres. So it’s what we call “time poverty.”
This happened to us probably ten years ago, to give you an example. There used to be a lot of board micromanagement — there still is some board micromanagement in chambers today. But the board micromanagement is pretty much extinct because of time poverty. Board members don’t have the time to micromanage the organization like they used to because of time poverty.
But that time poverty is not only hurting us as far as volunteer support and getting more volunteers and having board members say yes to being on the board.
For example, today, more and more people want to go home and run or go home and walk, go to the gym. They go to the gym in the morning, or they walk in the morning, and it’s very difficult to do all that and make breakfast. Well, at night, it’s difficult to go to a chamber mixer and have hors d’oeuvres and a glass of wine or something, and then go home and run or walk. Or they’ve got to go get the kids from school.
But the bottom line is the larger companies have more choices in sending people. They send different people to different events, whereas the small businesses can’t. Restaurants should be a good fit, but they have this time poverty problem. I think any retail kind of organization or startup professional services — a startup CPA, a startup attorney, a startup veterinarian — those kinds of professional services, especially when they first hang out their shingle. And if you’re new in the business, and you’re not well established, then I think the chamber is a good fit for you.
But retail in particular — I think retail and small professionals in the accounting/financial world is good. That’s a good fit.
About Randy Gordon
Randy Gordon was named President/CEO of the Long Beach Area Chamber of Commerce in April 1994. He is a 1988 graduate of the U.S Chamber Western Institute for Organization Management at San Jose State University, former instructor at the Stanford Institute, a past member of the Board of Regents of Western Institute, a 1993 graduate from the U.S. Chamber’s Academy at Notre Dame and is currently a trustee for the National Board of the Institute.He is a 1995 graduate of Leadership Long Beach. He is a past president of the 330 member Rotary Club of Long Beach and has 29 years of perfect attendance.
Part 2 of our series on small business networking groups, Randy Gordon discusses the negative effects time poverty has on healthy networking.
Nate: So the main objection that you’re hearing from Chamber members is: “I don’t have enough time?”
Randy: Yeah, we hear that a lot. For example, if somebody’s joined, then ten months later, we send them an invoice. The first thing they’re going to think about when they get that $510 invoice is, “What has the chamber done for me lately?” If they have not been to a single thing, a single event, unless they’re taking advantage of something electronically — maybe they’ve taken advantage of a social media/online workshop or something — but the odds are if they haven’t done anything with our chamber — even electronically — we’re going to lose them.
The other thing working against us — which is really sad for me to say this, but it is the truth — is this: the US Chamber will tell you that 90% of small businesses that start do not make it into the third year. So what happens is many small businesses, when they’re joining our chamber, they probably have more expendable revenue/income than they may ever have again because the odds are really stacked against them making it into that third year. And they’ve got to have deep enough pockets to make it.
So what happens is ten months after they join, in many cases, our small business members, even if they wanted to renew, or maybe if they’ve gone to some things, they’ve got a cash flow problem. They’ve got to say, “You know what? I can’t renew my chamber dues this month because I’ve got to make payroll.” So in other words, they are looking at that $510 saying, “Wow, I can pay two employees for a week with that.”
So they have to juggle that cash flow if they’re struggling. Now, if they’re not struggling, it’s a whole different thing. So I think basically, most of the time, to get to the real root or the reason they’re not renewing is this money. It’s almost always about money, that they don’t have the money, or they’re tight.
We do offer payment plans that will work with them, etc. But what happens is very few small business owners will be honest with you to tell you, “You know what? I cannot renew my dues for the chamber. I still have no money. I’m behind on my quarterly payroll taxes. I’ve got to pay that first.”
So what happens is we don’t really get the real excuse because most of them don’t want to admit that. Nobody wants to admit that they’re not making it, or that they’re struggling. So what happens is we get “I don’t have the time to participate.” So what happens is I believe that if I want to be involved in an organization and I’m going to pay dues, then if I don’t have the time to participate, I’m putting my money away.”
Many of them don’t feel that they can get that return on their investment without going to something because “Hey, I don’t have time. I’m here by myself most of the time. There’s no way I have time. I’ve got to take my kids off to school. I can’t go to a mixer night. Besides, I don’t drink alcohol anyway.”
So there’s lots of reasons, but I think most of the time it’s all about money. If the chamber of commerce membership was free, nobody would ever drop because our name, that plaque on the wall or that sticker on the door is the official seal of approval.
I’ve been at this 32 years, and I can’t tell you how many times I’ve gone into a small business retail store, and they have a chamber of commerce plaque that’s maybe ten years out of date, sometimes twenty. They don’t take it down. They leave it up there.
So what happens is even if it’s 10 years old, that doesn’t seem to bother them. They don’t want to take it down because they want the customers to see the chamber of commerce—“Oh, this person’s a member of the chamber of commerce.”
About Randy Gordon
Randy Gordon was named President/CEO of the Long Beach Area Chamber of Commerce in April 1994. He is a 1988 graduate of the U.S Chamber Western Institute for Organization Management at San Jose State University, former instructor at the Stanford Institute, a past member of the Board of Regents of Western Institute, a 1993 graduate from the U.S. Chamber’s Academy at Notre Dame and is currently a trustee for the National Board of the Institute.He is a 1995 graduate of Leadership Long Beach. He is a past president of the 330 member Rotary Club of Long Beach and has 29 years of perfect attendance.
Part 1 of our series on small business networking groups, Randy Gordon does a deep dive on the upsides and downsides of large metro Chambers of Commerce, and how business owners should navigate them.
Randy: Sometimes, chambers that are big—our chamber’s got a $1.5M budget with only seven employees, but the chambers of Los Angeles, San Diego are big chambers. But what happens is they’re so big that sometimes, a small business owner doesn’t find its niche unless they have a program specifically geared to small business people, like we do.
I can talk about our success in a minute, but I think the challenge with the chambers for small business owners is if you had a really big chamber like Seattle, sometimes you get lost. What happens is those big chambers are funded 80% by very large companies, like Boeing, for example. They cater to large companies because 80% of their revenue comes from probably 20% of their members. 80% of their members are small business owners that are not providing huge revenue to the organization. So sometimes, the small business owner gets lost in all of that.
We’re sort of that middle-ground chamber where we’re not small, we’re not huge. And we certainly care about small business owners. I think most chambers across America have not been involved in the American Chamber of Commerce Executives Board for many years. I’ve been in this business for 32 years.
We all really care about small business. In fact, small business is really the lifeblood of the membership of almost every chamber that I know of. You show me a chamber anywhere in America, and I would predict to you that 80% of its members have less than 10 employees.
But what happens in this business, it’s very difficult to please the small business owner quickly. For example — and this hit me a few years ago — the small business owner has little investment, but their expectations are pretty big. This business in today’s world is not what it used to be 30 years ago when I got involved in the organization.
So what happens is when I got involved in 1982, it was basically — there was no such thing as a retention problem. Everybody was a member. Everybody’s father, everybody’s grandparents were members. There were three- or four-generation business owners. It was the thing to do. There was community pride. People were not looking for an immediate gratification when they joined the chamber.
Today, it’s very different. Today, it’s just, “What’s in it for me?” In other words, its $510 to join, but they want a return on that investment, and they want it very quickly. It’s such a short time to please that small business owner because check this out: they join, and we bill 60 days in advance of the next renewal.
So we have about 10 months to somehow get that small business owner to an event, to a networking opportunity so that we can help that small business owner. We can only do so many things when that small business owner doesn’t go to anything. And the greatest challenge today in the chamber world is how do we show value to members who have no time to participate?
Now, I will repeat that because this is one of the most important things I can tell you. For small business owners, for chambers of commerce, how do we show value to those small business members who have no time to participate? That’s difficult. We can do it by social media, we can do it by email blasts, we can communicate with them electronically, and that’s better than nothing.
But unless you get the small business owner out to an event, to a networking breakfast, workshop, seminar, etc… The laws have changed where you can get fined if you don’t have certain things in your business like an employee rights poster. So even though we know it’s really important, and we’re doing a free seminar, we will help you not get fined, make sure that you’re legally sufficient with the new laws that just changed last January 1st — it is like pulling teeth, getting the small business owners out.
The reason for that is they join, and they have all good intentions. But they are so busy making the payroll, worried about can they make the payroll, and they don’t have a lot of employees, and they’re there 10, 12 hours a day, especially if they’re a restaurant business.
So what happens is — how do you get that small business owner out? One of our successes, we basically give them lots of free admissions when they join. We will pay for the meals, whether it be a breakfast, or a lunch, or sometimes a dinner just to get them out because we know that if we get them out, the odds of them being more successful and renewing their dues a second year goes up. So in a way, we’re really working on retention the day they join the chamber.
About Randy Gordon
Randy Gordon was named President/CEO of the Long Beach Area Chamber of Commerce in April 1994. He is a 1988 graduate of the U.S Chamber Western Institute for Organization Management at San Jose State University, former instructor at the Stanford Institute, a past member of the Board of Regents of Western Institute, a 1993 graduate from the U.S. Chamber’s Academy at Notre Dame and is currently a trustee for the National Board of the Institute.He is a 1995 graduate of Leadership Long Beach. He is a past president of the 330 member Rotary Club of Long Beach and has 29 years of perfect attendance.
