Major cashflow problem sees AMI ask members for $99 ‘service enhancement charge’

Darren WoolleyThe Australian Marketing Institute (AMI) is set to ask its members to pay a new $99 “service enhancement charge” in the face of a “cashflow issue” as it struggles with a financial deficit thought to run into hundreds of thousands of dollars, Mumbrella understands.

Australia’s main industry body catering to individual marketers has faced successive financial shortfalls, with major changes to its membership and financial systems leaving the association with a significant debt.

The new chair of the AMI Darren Woolley confirmed it will be writing to members in the coming weeks, and said the shortfall had come as the body had added “a lot of additional things added to the mix” which had added some “unforseen” costs.

“We introduced things like free professional indemnity, we’ve done projects with Deloitte about getting marketers on board and it’s that. Plus the changes that have occurred in the last 12 months with the new CEO, board restructure and a need to upgrade our financial and member data is another cost we have incurred,” said Woolley.

“So of these costs, some of them, were unforeseen and we have now found ourselves in a situation where there is a cashflow issue,” he added.

Woolley declined to comment on the size of the deficit, but said: “Being an association we don’t have access to all the financial options such as loans that we would be able to get if we were a business.”

He also said the AMI was committed to improving the financial performance of the association and members would see the benefits in improved services.

“Our only asset is our membership so this has meant we needed to go to the members for a one-off contribution that will allow us to continue to offer and improve and enhance those services over the next 12 months,” said Woolley.

“The things we want to do is the upgrade to our membership and financial systems and we have to do that for security. We have to revisit and relook at all our professional development courses and we have also been going through a heavy cost cutting exercise and we have cut all the costs out of the association without impacting the services to members.”

The move comes just a week after CEO Lee Tonitto acknowledged the financial challenges that come in sustaining membership driven organisations during, but said membership was growing.

“It’s not inexpensive to run an industry association,” Tonitto told a Mumbrella hangout, “you always need to make sure that you are evolving the business model and keep lean.”

Asked if times were tough financially at the moment Tonitto, who took over from Mark Crowe in August, responded by saying: “I look at the membership as a great barometer and we have had above average membership applications over the Christmas break.

“We’ve seen growth in our professional members and I also look at a barometer at the number of associations I speak to who want to partner with us. I think the future is very bright for the AMI.”

The AMI has a membership of more then 7,000, with around half of those marketers and the others students.

It is understood only professional and corporate members would face to the one-off surcharge. These members pay an annual membership fee of $380.

Nic Christensen 

The hangout with Lee Tonitto:


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