Pay Your Dues, Then Do for Yourself

Retailing trade associations can be a fine source of ideas. You’ll learn from other retailers, even from retailers selling product lines quite different from what you sell. Some of the most useful lessons can come from the hits and misses of retailers who sell to the same sorts of markets as you, but sell those people different items. By quickly adapting the lessons to apply to your merchandise mix, you can gain an early-start advantage over your competitors.
     For the small to midsize retailer, retailing trade associations also might offer group discount benefits not available otherwise.
     But after you’ve paid your membership dues, avoid social loafing, the risky shift, and group polarization.
     “Social loafing” is the name given by psychologist Bibb Latané to the phenomenon in which we leave the work to others in a group to which we belong. When joining a trade group, take care that you monitor their actions—such as the organization’s stands on legislation—to check that those actions drive the interests of your store. If an expectation of membership is that you’ll contribute resources to accomplishing the organization’s objectives, do this, but don’t allow those contributions to cripple your maintenance of your own business.
     First described by researchers at Massachusetts Institute of Technology, the “risky shift” refers to how groups of people make more extreme recommendations than if those people acted individually. Being insulated from full responsibility by the group, members of a committee can find themselves tempted to take potentially perilous business chances.
     More recent research has found that a committee often doesn’t give in to the risky temptations, instead actually moving in an overly cautious direction. These days, social psychologists prefer the term “group polarization” to “risky shift.”
     A New York Times opinion piece described the tradeoffs in joining up with others versus conducting business by yourself. The nicely-documented argument of the article is that sometimes we do best functioning as part of a team and sometimes we do best by closing off the distractions from membership interchange.
     It would never work, of course, for a retailer to conduct business in solitary confinement. Each of us needs our suppliers and our customers. That’s the function retailing plays in the supply chain. As to how much you’d benefit from joining trade associations, also keep in mind that successful retailers are energized by socializing. It’s in the DNA of merchants.

For your profitability: Sell Well: What Really Moves Your Shoppers

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