Issue:
SIX MONTHS INTO OUR financial year, I’m very pleased to report good news: we are getting stronger, with our finances well ahead of budget. Compared with last year, our first half (Apr. Sept.) revenue is up 8.3 percent and our bottom line net profit is up 72.3 percent. This has enabled us to boost our net worth to ¥12.02 million compared to a ¥3.62 million deficit in 2013.
Much of this can be credited to the hard work of many of our committees, our staff who have helped to bring in new banquet revenue and general manager Tom Yanagi, who is skillfully implementing fiscal belt tightening, collecting unpaid fees and modernizing our accounting and POS (point of sale) operating systems, among other efforts.
Overall, the first half FY2014 income statement shows a surplus of ¥16.7 million. The budget approved by the Regular Members last spring had forecast a deficit for the period of around ¥3.9 million.
Of the surplus, about half (¥8.2 million) is from stock market gains via the employee retirement fund sale, made possible by the solid stewardship of associates on the Finance Committee. This is not operating income of course, but it helps to bolster the retirement pool, money that would have to come from other sources if not for this gain.
It should be noted that we are not out of the woods, however, and continue to rely on revenue from the special levy to help cover our costs.
The levy, implemented in July 2012, brought in ¥12 million during the period. It is also a targeted revenue source. The resolution approving the levy stated that it was to be used “to cover transition costs related to our reincorporation as a Koeki Shadan Hojin (public interest association), including outsourcing of the Food and Beverage operation, and pay for an eventual renovation of the Club’s facilities.”
How exactly has the levy been used? Some has gone toward renovation (replacing old pipes, etc.) but the bulk of the spending to date has been on restructuring costs, including attorney fees in relation to ongoing staff legal cases from the F&B outsourcing decision. A House and Property Committee report shows, however, that we could face an expensive infrastructure emergency with our rapidly aging, 39 year old space. The Board of Directors and GM are looking at how much we need to spend to ensure our facility stays robust until our planned relocation in 2018.
We must make an important decision about our finances when the levy expires at the end of March 2015. Like a bad crutch, the Club has in recent years depended on revenue from special levys. Prior to the current surcharge, there was a Publication Levy (for Number 1 Shimbun) of ¥400 per month per member that began in April 2008.
So where do we source our revenue? By far the bulk is from membership fees at 78 percent (71 percent monthly dues and 7 percent initiation fees); 9.6 percent from F&B; 5.5 percent from the special levy; 6 percent “other.” With 60 percent of our Members over 60 years old, we will be facing a critical juncture in the coming years. Like many press clubs, it’s clear we need to shore up our membership numbers. Our recent discounted membership campaigns have helped significantly, but complaints from long time Members on this strategy have been growing.
The Membership Marketing Committee (MMC) is now targeting young Members with youth oriented events and services. Corporate memberships are in the works, and tax deductions on membership fees are also being explored.
The MMC will continue to take on our membership challenges, but we need your help. As you know, we are a small group of busy volunteers. Please join us in this critical endeavor, or simply help us with your suggestions.
We’re also moving forward on the donations front. The Compliance Committee has submitted a set of rules to the board in line with our Koeki Shadan Hojin status. Once passed by the board, the Donations Task Force will kick into high gear and begin soliciting donations. Please let us know of any potential donors!
Last but not least, we plan to establish a three to five year business plan, which Treasurer Yuichi Otsuka is determined to implement during his tenure. 2015 is our 70th anniversary year a critical period in our Club history when we must establish a solid base for financial stability. Again, I ask you, our Members, to help us with this endeavor. Help us ensure that the FCCJ will be able to celebrate its 100th anniversary, and beyond.
- Lucy Birmingham
