The suggestion to link our store into the Caterpillar system in your point 6. would be good for us. Unfortunately, Caterpillar hasn't had much interest when that idea, or similar thoughts to market through dealers, has been floated. For one thing, they have very rigorous and expensive requirements for anyone who's systems electronically interface with theirs. They also are very protective of their relationships with dealers and have not been open to anything we suggest which might involve them imposing any marketing opportunities on the dealers. They did offer to allow us to pay $2,500 to attend one of their quarterly dealer marketing forums so that we could make suggestions to the dealers there about how the dealers might offer some of our licensee products. That wasn't very attractive financially to us.

As to point 7., we don't generally incur direct costs of show production. Most of our events are accomplished by us being a guest at an existing show. We still have costs, although they are generally not large. Those costs include staff time and travel, van rental to carry merchandise to the show, sometimes table rental or tent rental, although many shows provide these to us at no cost. There are costs, they are not large, but they are there.

bernie - thank you for both of your posts. Your perspectives, for the most part, are parallel with mine. I didn't get a chance to reply to you earlier, but we do have a full time paid Club Manager. We restructured that position a few years ago, from when we had an Executive Director position. Our current Club Manager is very focused on membership retention and growth, among other duties. She has accomplished a number of positive initiatives which certainly have helped with retention and I think will complement our Chapter Policy by encouraging the continuation of the slight uptick in memberships. We also have a part time membership coordinator. Between the two of them, they staff the office, answer the phones, collect our money and make sure that all of our memberships, merchandise and other transactions get handled properly. They also staff our tents at the shows we attend and plan and execute our attendance at those shows.

We here are doing, and every member of the Board and management of the Club are doing exactly what you suggested, sitting at the table with the short pencil, figuring out where we are, where we need to go and how to get there. We will solve the immediate problem, the Club will operate differently going forward because of this work and I don't doubt it will be better for this work.

Pete.

Old Magnet - a little ways up you brought things back to the website upgrade and requested more information about what was anticipated to be accomplished in terms of improvements or changes to the way things operate. This is what I've been able to learn so far:

The upgrade we are doing is primarily driven by the fact that our version of the bulletin board software is old enough to be beyond support. It is working O. K. now, but we can't guarantee for very much longer that it won't collapse, become unstable or be unrepairable. We've known this point was coming for the past three years, but have deferred the upgrade because of the cost. We have pushed things far enough, though and shouldn't risk further deferral.

The upgrade will be to a newer version of VBulletin, which his the software that runs the board. I don't think anyone expects any appreciable change to the experience here as a user. I'm sure there will be a few new features that we will all notice when the upgrade happens, but all in all, I think you won't see much change. We know that Megan already reported to us that the picture upload sequence problem doesn't appear to be resolved in the new version.

The upgrade is not being done to get a better bulletin board, it is merely to keep the existing board up and running reliably. We could have chosen to attempt a change and improvement to the user experience, but that would have cost more time and money than the minimum upgrade we are accomplishing now.

Behind the scenes, other things are being upgraded too. Our membership database is a freestanding piece of software which is also antiquated, as is our online store and our main website. The upgrade is integrating these databases together, facilitating cross communication, increasing efficiency and accuracy of information for our backroom office staff, but not causing any appreciable change for our users.

This cross communication will allow the integrated system to communicate between our store, the membership database and the user-list here, so we should see things such as the identification of ACMOC members by a banner under their user-name, the ability to make a contribution to the Club, a targeted contribution in support of the bulletin board, and associated banners or tags attached to usernames. These features will require additional programming, so they won't be active immediately upon completion of the upgrade, but I expect that they will be available shortly after the upgrade is completed.

I hope this gives you the information you would like about where we are and where we are going from an upgrade perspective. If not, please let me know what you need and I'll try to get the answers for you.

Pete.

Garlic Pete,
Thanks for the update on the BB and website. Definately puts the expectations in perspective.

As for the rest of the dialog I'm reading a million reasons for "why" or "why not" but little if any change in immediate operations to either slow or stop the financial decline in reserves. To be more specific what is your projection for the next financial report.

I'll stick my neck out a bit and tell you what I think will happen between now and the end of the year, and what I think will happen next year. These aren't projections, but these are educated guesses, based upon where we are now and how I think things we have in motion will settle out.

I suspect that we will see the usual upturn in holiday sales and by the end of the year, what is currently a $40,000 operating loss will probably settle right about at that number. The loss has gotten a little bit bigger between the May numbers in the last magazine and now, but I think we'll make that back with holiday sales. This would have us end the year with cash reserves of about $150,000 and inventory of about $500,000.

I think some of the ad campaigns and other models stuff we're doing will spur sales, and the holiday may be even better than I'm predicting. I'd be surprised if it was worse, though. I think those campaigns will really begin to pay dividends in the first quarter of next year. Instead of sales falling to almost nothing for January, February and March, I think we'll keep a little volume flowing.

We are also working on several alternatives to move the older, bigger models and I expect one or more of those will begin to work in the first quarter of next year and will continue to work through 2014. I expect that we will have liquidated a significant chunk of the bigger models out of inventory by the end of the year, reducing inventory by at least $150,000 and converting that into at least $150,000 of additional cash, possibly more.

I also think the new advertising campaigns will complement our Chapters work and our membership numbers will begin to grow during 2014, not dramatically, but they will move off the 2,800 to 2,900 mark we have been on for some time.

I think we will be in a cash position to release a new model in 2014 and that will further stimulate sales during that year. I expect that 2014 will be a breakeven or better. There is a chance, with good liquidation of old models and the release of at least one new model, that we could post as much as a $50,000 profit for the year.

Take these with a grain of salt, this is just assuming that two or three of the six or eight strategies we have working now are realized in a positive fashion. I definitely wouldn't call these projections, though.

Pete.

OK, with a grain of salt it is.

On another topic I read where there is a specific and I expect a latent interest in independently supporting the BB and the "Technical Archieves"
How can arrangements be made to accomodate these revenues and not risk displacement of the current funding to support the BB. ie. diverting funds back into other club business which contributors do not wish to support.

We have a mechanism right now for donor designated contributions. We have accepted several donations to the various scholarship funds. That cash is segregated from the Club's normal operating cash, you see it on the financial statements as Restricted Cash. The cash or property donated with a specific donor imposed restriction can only be spent for the restricted purpose. In the case of the donations for the scholarship fund, those dollars, when they were or will be spent, will only go towards a check to a scholarship recipient.

So far, we have not had anyone make a donation restricted for use in funding or improving the bulletin board. If we did, though, those funds would go into the restricted category and could only be spent as directed by the donor. Anyone now could send such a donation by simply mailing a check to the office with a note describing the donation, or calling and doing a credit card transaction and telling the office staff about the restriction on the donation.

When the bulletin board upgrade is finished, we will have a transaction available in the online store, with a link to the board here, so that interested people can make such a restricted donation. We'll probably also include the option to make an unrestricted donation, if they like. The restricted donation would be the one that I think should trigger a bulletin board supporter banner for their username on here. These funds would automatically be assigned to the bulletin board restricted cash account and could only be used to fund the bulletin board operations.

I would imagine that we could set up the technical library and just about any other area such that only supporters would have access. There is something to providing value for the contribution, but an offset to that strategy is to make information available to the general public, attracting new participants and members. We'll have to get the integrated systems in place and be able to acknowledge the support first, then we all can decide what is best as far as access and premium content.

Pete.

I'm still at a loss as to how monies designated for BB support would not displace funds normally allocated, in effect diverting funds to other uses.

I welcome all the new Financial Members we can get, but even if we add 100 American members in the next year that will only add around $4,000 to our "income" (100 X $40 annual membership fee), and when you deduct the cost of the Magazine ($30 per year for US delivery, 6 editions X $5 each?) our net improved position is only $1,000, or about what it costs us to provide a "Free" phone line for Lance Jones here in Australia to phone the USA for Board Meetings I'd suggest.

If most those 100 new Financial Members come from Australia, as they most probably will, I think the Club will actually lose about $2,000 extra a year because I suspect the significantly higher price of US Post Airmail to Australia, New Zealand and the U.K is not being covered with Annual Membership of what $65 for "Foreigners" like me, I suspect ACMOC has been losing about $15 to $20 per year per international member, and I look forward to being proven wrong.

On the subject of donations to fund specific projects within ACMOC, that has been my goal all along, to try and drag some nickels and dimes out of everyone's pockets to fund this one key project so important to everyone reading this, of the Forum Upgrade, and it is important that the new Australian ACMOC Chapters seek a Not for Profit Charity ruling from the Australian Tax Office at their earliest opportunity so that generous folks who believe in ACMOC's future enough to actually make donations, like Mike Meyer and our other Aussie buddy, can claim those donations as a legitimate tax deduction here in Australia, because I'm 99% certain the Australian Tax Office might not allow offshore donations as a legitimate deduction. Once Australian donations to ACMOC USA are received by Lance Jones here in Australia, I assume he will do a single money transfer to ACMOC USA.

If I say I'm going to do something you don't need a Lawyer to witness the deal, or an Accountant to count the change, I'm one of those old fashioned idiots who still believes a man's handshake is his bond.
regards
Mike

I wish to make more comments/ramblings here, due to preparing for the Corryong Rally this weekend, don't have the time to write at length.

The Magazine: Possibly look at only four good issues per year. Get Caterpillar dealers to sponsor say two per year in conjunction with their magazine. ie get one dealer to print magazine with ours combined into it.

Caterpillar support: The dealers are much closer to us on the ground, maybe chapters could be bonded with a dealer. Discounts for chapter members? Donations/philanthropy dealerships to chapter ACMOC. We are more benefit to Dealers than Caterpillar inc.

Board: Develop skills matrix, see what skills are lacking and look for new board members with appropriate skills. Just because I like collecting vintage Caterpillar tractors, does not mean I will make a good board member, look outside membership for the right people etc

Core business: Need to decide what ACMOC's core business is, and concentrate on that first, develop a long term business plan.

International: Work on a plan to have more international involvement, listen to others more, what went wrong with Chapter 2? Need to address that to go forward and not repeat the same mistakes.

Phylanthropy: Develop a plan to source support and donations.

All for now, will be back after the weekend and elaborate on some of the above.

Old Magnet - as with any system or budget, there are no guarantees or protections to prevent one dollar donated specifically for the website from displacing a dollar the Club would normally have spent on the website, which the Club now spends elsewhere. The integrity of the leadership and the monitoring of the stakeholders is the only protection against this type of shift.

In our case, all of you can read the financial information which is published, and which I or my successors should provide to you in detail if you requested it. If, for example, we received $1,000 of donations restricted for bulletin board operations, you should be able to follow along in the financial statements. When the $1,000 reduces because it is spent, you can see in the same period if bulletin board spending went up by the same amount, or did it remain the same.

If it went up by the same amount, you will know that the restricted funds were used for the additional spending. If the spending is flat, you know that the restricted funds just displaced money which was then spent elsewhere. If the restricted funds went down by more than the total spending on the website for that period, you should be asking some hard questions, because that would likely mean that the Club spent that restricted money improperly on non-website stuff.

This is true of any budgeting system. Even in the extreme situation where funds are escrowed and only released upon approved draw, there are never guarantees that spending in one area won't displace funds to be used in another area.

That's the best explanation I can give. The best protection is monitoring the financial statements and information. That is why we are required to account for restricted donations in the manner we are, so that the donors can monitor their use.

Pete.