A Unique Business Model that Works

Bruce-Clarke-CAICapital Associated Industries Inc. has earned a longtime reputation as a trusted resource for compliance, human resources and people development.  The company, headed by President and CEO, Bruce Clarke, is the nation’s largest non-profit employers’ associations, serving the Research Triangle, Piedmont Triad and sixty-five central and eastern counties of North Carolina.  The company has over 1,200 members.

Capital Associated Industries Inc. has a rather long history, beginning in 1963.  Clarke joined the team ten years ago.  He explains the impetus for the company’s formation.

“Twenty-two companies in the area got together and said, ‘We need help because this area is growing, because industry is moving here and we need help knowing what to pay, knowing how to benefit, knowing what other employers are doing, knowing what the market is, and helping  to maintain the area as a good place for more employers to come.”

Clarke says that his company has a unique business model and a twofold purpose.

“One is to help employers to minimize liabilities, to help them stay out of trouble and to stay in compliance with all the laws and the rules that are out there. The other is to maximize opportunity, and that means to help their managers and supervisors be better managers and supervisors and leaders in the company.”

Capital Associated Industries Inc. is able to tackle these goals independently or in combination, in a way tailored to their members’ needs.  In addition, Clarke says the company then layers services on top of that, usually in the form of public policy advocacy.  It has a lobbyist in the General Assembly who lobbies to improve state laws and regulations that affect the workplace. In this way, Capital Associated Industries Inc. functions as a non-profit.

“We don’t hide that, but a lot of people don’t understand that,” explains Clarke. “It’s a nonprofit; it’s run by a board of directors made up of a number of companies and CEOs.  So we’ve got very much a mission and vision and purpose-type philosophy, as well as having to run it like a business in order to progress and be here in the future.”

In addition to his leadership role with Capital Associated Industries, Clarke serves as Chair of the Labor and Employment Law Subcommittee at the National Association of Manufacturers, a job which involves his traveling to Washington and sometimes testifying in Congress.

“We just had a trip to the White House recently where we took a group of business people from Raleigh to meet officials in the White House, and to listen to the pain that they have as business people,” he says.  “It’s all part of that not-for-profit mission and vision, but you still have to grow as a business.  It’s an interesting dynamic.”

As for a typical client model, Clarke says he’d have a hard time listing an industry with which Capital Associated Industries Inc. doesn’t work.

“We’ve got the hospitals and the banks, retail, restaurants, services, manufacturing, medical doctors, dentists. We work with every kind of thing, including technology companies, start-ups, pharmaceuticals, something from every area of the economy.  Manufacturing is still about a third of our membership, whereas it’s about 20 percent of the economy so we’re a little heavy on manufacturing.”

Most of Capital Associated Industries Inc.’s members employ around one hundred people, though there are a few strong exceptions, such as those with two employees and those with up to tens of thousands of employees.

Clarke says people would be surprised if they could see the overall scope of how much “time, effort, brain power, money and sweat” is put into anticipating the needs of members.

“Our strategy really is to make that membership basket of services that are included in the annual dues figure so powerful and so effective that it’s almost a no-brainer to renew,” he explains. “And that can make that basket uneconomical.  It could mean that that basket in and of itself is not economical for the fee charged.  We probably crossed that line several years ago, but that’s still the strategy:  Grow and retain the membership base, even at the expense of providing more in value than we’re receiving back in dues.”

Between the Greensboro and Raleigh offices, Capital Associated Industries Inc. has forty-two full-time employees and around twenty part-time employees. Most of these part-time employees work on projects in the field and then flex up or flex down their hours based on members’ needs.

Regarding the culture of the company and its members, Clarke has nothing but positive things to say.

“Oh, we’ve got great people.  That’s the best thing.  Everybody says that but it’s because of the business model here which is an annual subscription, or annual dues. The member gets a chance every year to say yes or no to that.  The relationships that our people have within are really key to our success and our stability.  People view CAI through the lens of who they deal with every day and we’re just very fortunate that those are people that you and I like and respect and that they like and respect.”

The company is proud to balance its work with philanthropic roles as well, working with Habitat for Humanity and, most recently, with the V Foundation.

Clarke says he’s looking forward to Capital Associated Industries Inc. both growing and developing new services in the near future. The company opened a new office in Greensboro a few years ago, and Clarke feels that there are other geographic opportunities within North Carolina where the company has a strong membership base and could benefit from an office presence.

“The decision is easy; you want to grow,” he says. “We have done some geographic expansion, and we’ll probably do some more of that in the future.  We’re very active now compared to three years ago in new member development, whereas in the past that was much more passive and involved more receiving phone calls from the outside.  There’s much more outgoing prospecting going on now.”

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