Round 3 with Dave

[Erik Olson <erik@thekrib.com>]

Hi folks, 

The last week has been pretty hectic for me.  Just did the layout on my
second issue of BB, and it pretty much exhausted me through yesterday,
when I talked to Dave on the phone. So here's what's been happening:

I got the membership roster from Jack, and "censored" it to only show
name, city, and zip code; I sent this to Dave and he did a comparison with
the current PAM roster:

AGA (total)  754        PAM (total) 448         Both 154

This means that should this deal happen, the AGA will add 600 new
subscribers to PAM, and PAM will bring in about 300 new AGA members; both
organizations will finally push through the 1000 person mark.

OK, good so far.  From my standpoint, this could mean a lot towards PAM
being in the black.  A quick analysis: If what Dave was saying last time
we talked is true, he's losing approximately $1300 per issue, and the
marginal cost of new members is effectively just the mailing (39 cents per
issue?).  Then long term his yearly income is going up by 600x$15 (new
members) and down by 448x$5 (old members now paying less because $5 now
goes to the AGA).  Let's say it also costs about $2 per year for more
members' postage = 600x$2.  This translates into an increase in revenue of
about $1400 per issue, which is pretty close to how much he's losing right
now.  He would be "even" (though not counting whatever costs of his own
and probably Karen & Neil's time he's opted not to pay for).

Like last time, it is hard to convey how Dave is thinking to you guys,
just like it's hard to convey other people' thinking (such as mine, above)  
thinking to HIM. But I will endevour to do so, at the risk of sending
David and others running through a wall again.

Dave thinks this is not quite enough.  From his point of view, the AGA is
doing very well financially and PAM is not, and so in this transaction
there needs to be some kind of "net flow" from the AGA to PAM.  Here,
these are his exact words, and he really did want me to forward this to
you guys (though I tried to talk him out of it!):

"Will this be a symmetric relationship?
  No.  Right now, AGA operates at a surplus, PAM at a loss.  Any relationship
   with long term stability will tend to correct this situation, with AGA
   appearing to give up more than it gets."

So he's been trying to come up with ways for the AGA to in some sense "pay
up", ostensibly for the 2 or 4 pages of business that will be published in
PAM.  What's odd is that I have the same goal, of long-term stability, but
would prefer to see that goal met by a healthy, happy, large member base.

Dave's first proposal was to flat out treat the AGA business pages like a
paid advertisement, at $600 per page = $4800 per year.  (he said yesterday
that this was for FOUR pages, not two pages, which would only be
$2400/year.)  He was curious if the $5 per AGA membership would be able to
pay for this (no, it can't... that would be more than our yearly income!).

He then suggested a modified proposal of the AGA charging this in its dues
ON TOP of our $5 per year, making the total price tag $27 per year.  I
explained that this also will not fly, and that most consumers won't pay
more than $20 / year for this type of thing.  This was all covered in my
last message almost 2 weeks back, btw.

So in the meantime, with me rejecting both his initial ideas and
suggesting instead that the AGA pay NOTHING for the two pages, he's been
coming up with some more ideas.  He's also pouted that maybe he just would
give us the pages for free "for the good of the hobby".

The latest proposal was:
  1. AGA gives pro-rated free membership to existing PAM subscribers.

This is reasonable to me.  Doesn't cost us much to do this, and it's a
one-time hit.

  2. AGA pays PAM $3.75 per issue for current AGA memberships (that's
     $15/year).

Again, also seems reasonable to me.  It does cost the AGA, for our
existing members (essentially using ALL of their dues if they just signed
up).  But it's an initial condition.

  4. Both AGA and PAM independently enlist members/subscribers,
  with PAM paying AGA $5 per year per "subscriber" and AGA paying PAM
  $15 per year per "member".  

This is sort of a "separate but equal" thing, I guess.  But as Dave's
advertised costs are much higher than AGA's, most likely everyone will
sign up for renewals at the AGA side.

  3. (This is directly from Dave) "I am not sure exactly about this
  one....... AGA will supply a list (on a one-time only basis) of AGA
  members who are not PAM subscribers to receive an initial, back-issue
  shipment of PAMs.  AGA to pay $19 per name to which five back issues will
  be shipped by PAM.  Or it could be $11.75 per name, three back issues.  
  Or $15 per name for four.  Or $8 for two.  There are estimated to be about
  600 AGA members who are not PAM subscribers."

When I asked him about why this point #3, he explained it as a "quid pro
quo" for the AGA business pages.  I didn't think it was a reasonable
suggestion, but did promise to take it back to you guys to discuss.  I
suggested in e-mail that we might be able to SELL back issues to members
via the bookstore.

In closing: My opinion is that providing free AGA memberships to the
existing PAM subscriptions and paying essentially the entire membership
fee to PAM for existing AGA memberships is a gracious gesture, but
reasonable for us to do, given our current treasury.  However, there is a
limit; I do not beleive that we need to agree to any further terms, such
as the #3 above.

  - Erik

-- 
Erik Olson
erik at thekrib dot com








  ------------------
  To unsubscribe from this list, e-mail majordomo@thekrib.com
  with "unsubscribe aga-sc" in the body of the message.
  Old messages are available at http://lists.thekrib.com/aga-sc
  When asked, log in as username is "aga-sc", and password "showy".