A member of the Chamber of Commerce Professionals Group on Facebook asked:

This year in particular, we have a lot of members that are significantly past due.
Has anyone used “late fees”? Did it work? I would like to implement late fees next year.

Chambers and Business Models

The chamber professionals had mixed emotions about charging late fees, some of them gave a thirty-day grace period and then added $50 to the fee, others suggested charging is not good business. After all, there are options outside of fees.

Auto-assuming Membership

A lot of businesses that offer monthly options, auto-renew at the end of each month. There are no late fees and no late notices that are sent. The credit card on file is billed at the determined date, and the membership or service continues for another month. This is communicated at the beginning of the term and notice is often provided before the card is charged.

The 90-day Rule

Some chambers agree upon a 60-day or 90-day rule where they chase the money for that designated time and then send a final expiration notice advising the member that their membership has expired and they are no longer a member of the chamber of commerce.

Incentivize the Desired Action

If you don’t want to chase money, give your members a reason to pay early. This could be a discount or a free event ticket or early access to an event that sells out.

The Costco Warning

This one is important for chambers who allow members to renew months after their renewal date. In 2009 Costco settled a class action lawsuit where members who renewed after their renewal were not given a new renewal date. For example, a membership was up for renewal in January 2008 but the member did not pay the renewal until March 2008. The membership period was from January 2008-end of December 2008, even though they didn’t pay until March. This means they paid for two months where they received no services. As part of the settlement, Costco stopped counting membership from when it expired to when it was actually renewed.

Chamber Membership is not a Contract

With membership organizations you have the choice to renew or not. Charging a late fee is done by businesses you have an agreed upon contract with or owe for services. As Robert Goltz, President/CEO of the Miramar Pembroke Pines Chamber of Commerce, advised “…membership is not an obligated fee to your organization. Members can choose to not renew.” Because of this, leveraging a late fee is not appropriate from a business perspective. They don’t owe you the money, they choose to give it to you each year.

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