How to create an association: a complete guide

by Andy Pearson in October 6th, 2021
Create an association

There are over 8,000 large associations or membership organisations in the UK and many more small associations. If you run a community venture, club, or non-profit organisation, you may be running an association. 

In almost all cases, associations are not run for profit; they exist for the benefit of their members. Nonprofit organisations can sometimes benefit from tax-exempt status. 

Creating an association is a relatively simple process but as your association grows you may need professional guidance on key decisions. 

This guide will break down the main considerations when setting up an association and keeping it running successfully. It focuses on forming an association in the UK and the relevant legal requirements according to UK law.

What is an association? 

An association is made up of a group of people who work together to achieve the same goals. It’s not a typical commercial company whose primary goal is profit but rather a group working towards a common cause. 

It could be a sports club or an association of gardeners, lawyers, teachers or employees. There are also lots of associations with commercial organisations as members. These are sometimes referred to as trade associations or umbrella organisations.  

When creating an association, members usually put together a written agreement to establish its aims and goals. This agreement could include specific criteria or rules you set out for new members to become part of the association. 

Common types of associations include: 

  • Sports clubs
  • Preservation trusts
  • Employee unions
  • Professional associations 
  • Residents associations 
  • Voluntary associations 
  • Trade associations

Here are some examples of associations in the UK:

There are associations for just about every vocation, profession or hobby imaginable.

Goals for your association 

The most important thing when it comes to founding an association is to have a common goal. Along with your founding members, you need to have clarity on the exact need you are trying to fulfil with your association. 

You may want to create a network for like-minded professionals; you may want to work with others to look after a local monument; you may wish to enhance resources available to your community. Whatever the goal of your association, it needs to be precise. 

Write up a plan with your co-founders to list out exactly why you are starting the association. If everyone involved with starting the association aligns with the goal, you are more likely to create a successful association. 

You can write a summary of how you aim to achieve those goals. You can split your goals into short, medium and long term goals. Your plan should include how you will make revenue to accomplish those goals. 

A successful association has committed, loyal members. Once you start the association, how will you find new members? What will your primary promotion strategy be? Will you charge a membership fee, so that you have the revenue to achieve your goals? If not, how will you fund the association?

Here are some of the crucial questions to answer when you write your association plan:

  • What is the goal of the association?
  • Who do you aim to serve?
  • How will you achieve the main goal?
  • How will you make revenue to achieve the goal?
  • How will you market and promote your association? 
  • How many members do you want to attract?
  • How will you structure the association as it grows?

Try to encompass your vision in one clear statement that can be the foundation of your association. 

Creating a clear structure from the offset and an idea of how your association will evolve as it grows will facilitate easier decision-making. 

Understand your market

Before you start an association of any type, you need to know if there is a market need. 

Are you thinking of starting a sports club in a community that already has dozens of clubs? Are you trying to create a professional association in a workplace that already has one? 

Understand and analyse the market need. Just because you have a good idea for an association and think it could work doesn’t mean other people agree with you. 

Analyse the existing associations in your space to determine whether or not there is a need for a new one. Take a look at any associations you deem your competitors and analyse if your association will offer something that theirs doesn’t. 

New associations rarely survive without meticulous research and planning. Speaking to your potential association members is the best way to learn whether or not there is a need for the association you are planning to found. 

Not sure who your potential members are? Create a member persona, so you have clarity on the type of person you want to attract to your association. Once you know who your target audience is, you can go about finding them and asking them for interviews. 

The more data you can collect from your ideal customer, the better. Having potential members lined up before starting your association is a great marketing tool and another step closer to creating a successful association.

Why do so many associations fail?

There are multiple reasons many associations don’t make it past their first year. These reasons include but aren’t limited to: 

  • Lack of shared vision or effective collaboration between founding members
  • Not serving a market need 
  • Trying to operate in an already saturated market
  • Inability to make revenue 
  • Not understanding market needs
  • Poor organisational structures
  • Poor marketing
  • Failure to attract new members
  • The association not serving its intended purpose

If you want to avoid these pitfalls, make sure you have a clear and structured plan before you start your association. 

A little planning and your broader vision can go a long way to ensure the success of your association.

Determining the management structure of the association 

Once you establish the need for your association, you will need to decide how to structure it.

Do you want every member of your association to vote on every decision? Most likely not, as this will be complicated and time-consuming. 

The easiest way to make quick and fair decisions in your association is to delegate day-to-day decisions to a management committee that acts on behalf of members. 

You can ask active members to elect a small number of members to be on the management committee. This will ensure your association is making fair, democratic decisions and encourage active participation in the association. 

Here are some questions to consider when deciding how to structure your association: 

  • What role will your founding members have in decision-making?
  • What rules do active members need to abide by?
  • How often will voting on significant decisions take place?
  • How often will the management committee meet? 
  • Will you have an annual general meeting?
  • How often will the management committee change and how is this process managed?

Once you have the answers to these questions, it will be much easier to determine the structural organisation of your association.

When you first start an association, you will need an element of trial and error to determine what works for your organisation. There is no exact formula for how your association’s structure should develop; you will learn as it grows. 

Recruiting a board and staff

Having a board is essential for driving the major decisions for your association and ensuring it adheres to all legal requirements and is under ethical management. As associations grow the governing board often becomes increasingly distinct from the management team that manages day-to-day decision making.

Recruiting board members

Your board members could be founding members of your association. Together, the board should cover all of the most important board roles and responsibilities. When recruiting board members for your association, you want to ensure they share your vision and long-term objectives for the association.

Team board members are often recruited through word of mouth or from recommendations in your network. You want to ensure whoever you recruit for your board has no conflict of interest with being involved in your association. 

The board members are responsible for all major decisions within your association, so you need to recruit people you trust.

Association board members are not usually paid, so are people with no financial dependence on your association. It is best to recruit board members who have expertise in the field you want them to supervise. 

Some of the common roles an association recruits for their board include:

  • Board chair
  • Financial advisor / treasurer
  • Legal adviser
  • Marketing manager
  • Events manager

At this point, it is worth spending some time learning how to run effective board meetings.

Recruiting staff

Once you have a board established, you may want to invest in recruiting some paid members of staff. A growing association requires a lot of admin, and organisation and staff members can help you do this.

However, paid staff are expensive and bring their own extra admin load. Another approach to consider is investing in association management software that can save you time and allow you to run with volunteers for longer. Using membership management software can also free up your budget to invest in growth and marketing for your association. 

As your association grows, you may want to hire someone to manage your marketing and recruitment of new association members. Having someone to lead your tech may also be vital if you want to increase the digital presence of your association. 

You may require staff members to take care of events your association hosts, as well as your fundraising efforts. Event organisation is a time-consuming process, so you may need to recruit a small team of people for this.

There is a lot to consider when hiring a team of staff. Hiring is an ongoing commitment that includes managing your people and paying them monthly even in quiet patches. As you start to hire staff you'll need to draft an employee handbook.

How to make revenue as an association

Associations can make revenue through various income streams. The most consistent way for your association to make revenue is through membership fees. 

Your members pay a yearly fee to be part of your association. However, you will need to justify this membership fee. In return for the fee, you will need to provide value to your members. Whether that’s through industry events, exclusive content or access to industry connections, you’ll need to demonstrate the value members will receive through paying their fee. 

The other big revenue maker for associations is events and conferences. Large events can make up to 50% of your yearly revenue. Events are also a great way to attract new members and promote your association in new communities. 

Another way your association can make revenue is through corporate partnerships or affiliations. These are longer-term relationships that are harder to secure but provide more predictable revenue. 

Building an association website

At the very start of your journey all you need is a very simple website that explains your association's specific offering. For your first few members you can often get by with manual tools for signing up new members. However, once you gain a little traction you will find yourself needing a number of common association website features:

  • Online joining and payment
  • Member only area
  • Event booking
  • Directories

Thankfully there are a range of tools available that are tailored to building association websites and you can read more about this in our guide to building a membership website.

There are two main legal structures typically used for associations in the UK: incorporated and unincorporated. 

What is an unincorporated association?

“An ‘unincorporated association’ is an organisation set up through an agreement between a group of people who come together for a reason other than to make a profit (for example, a voluntary group or a sports club).
You don’t need to register an unincorporated association, and it doesn’t cost anything to set one up.
Individual members are personally responsible for any debts and contractual obligations.”

Source: gov.uk

The main advantage of an unincorporated association is that it is very easy to set up. For this reason, it’s popular among small local associations. But for associations with bigger ambitions, this legal structure can quickly become limiting. Unincorporated associations can always change their legal structure at a later date. 

What is an incorporated association?

Incorporating an organisation creates a legal entity that exists separately from the people who run the organisation. This process provides legal protection because it is the incorporated organisation, rather than the people, that enters into transactions and takes on legal liabilities. 

There are a few legal structures you can consider for an incorporated association including a company limited by guarantee and a charitable incorporated organisation. We discuss these in more detail in our post on Charity vs social enterprise - CIC, CIO or LTD?

Whichever model of incorporation you decide on, you will need to register with the appropriate UK government body and file the necessary paperwork. While professional advice is often helpful at this stage many new associations manage the incorporation process directly.

Finding software to manage your association

You can ease the burden of your association’s membership management by using association membership software. Membership management software allows you to keep all your members’ data in one place, track membership renewals, send association communications, updates, and news. 

It also lets you streamline your associations’ processes and keep all information and data in one place. You can use it to manage payments, event sign-ups and calendars, as well as your website. You can even use membership management software to build your community and facilitate conversation between members. 

Start building your association 

Creating an association is initially a straightforward process; you need to write an agreement and have a common goal with your association founders. 

The complexities of starting an association come when you start to grow. Here’s a recap of the things you need to keep in mind when starting an association: 

  • Recruiting new members
  • Managing your members
  • Maintaining and growing revenue
  • Creating a board and stakeholders
  • Deciding whether to incorporate or not 
  • Determining your legal and tax obligations 
  • Hiring staff
  • Marketing and growing your association

To streamline the processes of managing your association from the offset, make use of management software. It will save you time and hassle. Keeping all the information about your association in one place will make administrative processes smoother as your association grows. 

Now you know more about how to start an association it’s time to get going! 

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