‘State of the Association’

Comment By BVAA Director Rob Bartlett

General income trend encouraging, subs income declining of late

Training in full swing

Last years’ Desktop Exhibitions
A few years ago, the BVAA closed down its old ‘Executive Committee,’ and in doing so also changed the format of our Annual meetings from our somewhat ‘traditional’ style. This was in response to a demand to ‘be more entertaining and informative!’

Although AGM attendances have risen beyond all expectation, several members have commented that we have, as a consequence, lost an element of updating the wider membership about the state of our association, its finances, services, future plans, current challenges, etc. I tend to agree.

Our Annual Review (enclosed in this issue) attempts to cover some of this, but as a ‘retrospective,’ has certain limitations. This commentary seeks to fill in some of those gaps in members’ knowledge in a more detailed way. But where to start?

Firstly, I can only speak authoritatively about my minimal experience of the Association – a paltry sixteen of the 80 years BVAA has been in existence! So, I feel I should restrict it to my ‘watch.’ Secondly since everything we do revolves around available resource, finance is probably a good place to start.

BVAA touts itself as ‘not for profit’ - but what does that actually mean?

Officially BVAA Ltd is a company without share capital, limited by guarantee.

As such we are quite at liberty to retain a surplus, if we so wish.

But perhaps uniquely in business, an association that makes an excessive profit is considered equally as ‘bad’ as one making a loss - members don’t give us their hard-earned cash just to pass it on to HMRC in the way of corporation tax!

So, each year we set a budget that plans to see virtually every penny converted into products and services for the benefit of our members. ‘Making that so’ however is extremely challenging given that we set that budget C.18 months in advance of actually knowing our final income.

Over twenty-five years’ experience in associations, a great team and pretty good intuition generally sees us through, with - I might add - remarkable year-on-year accuracy in the predictions.

Decline in subscription valve
Another hugely important issue is the changing demographic of the BVAA membership, and its impact on subscription ‘value.’

BVAA used to comprise almost entirely manufacturers.

These days less than one-third of BVAA members declare themselves as ‘UK manufacturers’ – but even so there’s many more of them in membership now than the entire membership of 2003!

With the ineffable shift from UK-based manufacturing, indeed demise of some major players, there has been a longterm trend for the average size of a BVAA member to decrease, and the subscription contribution to consequently fall with it.

My predecessor at BVAA had a much smaller association – just 55 members. At the time of writing we number 200. However, the average subs contribution last year alone from those joining compared to those leaving was significantly less.

Looking back further… the value of the average subscription back in 2003 was, according to RPI, equivalent today to C.£3,5k per member p.a. The average actual contribution today is just £2,4k – a drop of a third.

So, while we have many more members, my team has to deliver considerably more with considerably less contribution.

Subs represent less than 60% of what we actually need to operate at current activity levels – and the pressure is always on to deliver more.

We derive the remaining 40% of income we require from training, exhibitions, event fees and other commercial activities. Since a lot of that can be described as ‘discretionary spend,’ again it’s very tricky to predict, one year to the next. Inevitably my BVAA team spend a lot of their time ‘selling’ to members, in order to raise funds in order to service members.

What’s different today?
Financially, despite all the challenges described above, the Association is in considerably better shape, as our assets chart shows.

It is my honest opinion that the BVAA of 2003 would have been long-since bankrupt had it not changed its scope. Alternatively, to deliver what we do now, to the same population, the fees per company would have to be absolutely astronomic, rather than a ‘third less.’ Interestingly, a significant proportion of that 2003 membership no longer trade, or were enveloped by larger entities.

Despite everything, the 2018/19 year was our second-best ever when it came to total income and non-subs income. The fourth year of decline in subs income however, for the reasons described above.

Last year our reserve account was about 50% bigger than it was in 2003, but our overall assets are over FOUR times as big, including our freehold building. We also represent about FOUR times as many British companies – a massive change for the better.

Our headquarters is worthy of further note. Never before in our 80 years has BVAA owned its own premises. Today we have a modern freehold office, with a well-appointed training suite above – the Peter Churm Technical Centre. Ne’er a week goes by without a member using our own – and free-to-use - meeting facilities.

Commercially, members have a vast array of services to call upon. And despite what you might think from the ‘non-subs’ text above, a great many of services are included in the subscription!

The BVAA Board continue to support this approach and recognises fully the need to offer a ‘smorgasbord’ of services – i.e. something for everyone. This is completely in tune with our very diverse membership make-up which demands nothing less. It all necessitates a bigger and superbly professional staff.

A list of activities that we do now, that we didn’t do in 2003, would include: -

Our own Training, Desktop exhibitions, Valve User Magazine, Annual Dinner Dance, Websites, PR-writing assistance, promotion in the trade press, Global & UK market forecasts, O&G market tracker, Supplier Days, Regional meetings, Golf Days, Sales Leads information, Valve World Group Stand, Trade show representation, Intelligence Bulletins, Social Media, Future Leaders Programme, standards meetings’ travel funding, Technical Expert Groups, Technical HotSpots, enhanced User Manual, Free Directives Guides, the Business Shield Service, our Online document library, website promotion, free specialist Technical advisors, etc.

Worthy of a further note, BVAA Training income – more specifically surplus – has ballooned 230,000% since it was brought back under the control of the Secretariat! Sixteen years on, and disregarding any RPI, BVAA members still paid this spring the same amount for a standard course as they would have done in 2003, for a much-enhanced product, with the addition of CPD accreditation, and a free User Manual! We should note that that surplus gets ploughed straight back into association funds, to subsidise other services.

Magazine & Desktops
Both also merit further attention. Firstly, we are highly unusual – indeed we believe unique in our sector of engineering - in that we publish the industry’s leading journal. Only rarely does that generate a surplus, so again members get access to a superb PR vehicle, with free of charge editorial, and with advertising at a largely subsidised cost.

The Desktop Exhibitions programme was moribund in 2003 (i.e. zero events). In 2019 members can more or less count on there being an important customer-facing event every month, and we are now seriously looking to expand this overseas.

Originally the main focus of the association, for decades, all this standards and directives work - and more - continues still. With Brexit throwing up all manner of new and potentially threatening challenges, our technical team has expanded beyond Martin Greenhalgh and his volunteers, to a team of specialist support consultants. That’s an additional cost we bear too. But vital if we are to adequately support our members.

The Future
BVAA’s Board - a team of nine elected by the members - chews this one over relentlessly. The variety in membership means that ‘smorgasbord’ approach is essential to cater widely and address the primary needs of all. We also have focus groups on Business Development to keep business coming into our members, and also on the ‘Messages’ we want to get to the outside world as well as communicate to our own brethren. With Brexit upon us, we may need specialist task groups there too.

Three times a year the Board reviews in detail what we’ve done, what we’re doing, and what we plan to do next. There’s neardaily dialogue with the Chairman and others, keeping the BVAA machine well oiled.

Notwithstanding all that, the old adage ‘you get out of membership what you put in’ still remains as relevant today as it did to our founding members in 1939. Participation is the key to success – indeed it is vital!

80 years on, I think they’d look down and while probably not recognising much of the company-name landscape, would have a warm glow from knowing the association they founded is still striving as hard as ever to support the British valve industry.

Published in Valve User Magazine Issue 48

Winter 2019 // Issue 51
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