If You Aren’t at the Table, You’re on the Menu
Your industry association and larger competitors may have different priorities. Direct participation helps policymakers understand your business before decisions affect its costs and ability to compete.
Written by
John Fletcher
There is an old saying in politics and business: If you aren't at the table, you're on the menu.
It sounds cynical. But when it comes to public policy, it’s an entirely accurate description of how decisions get made.
Every legislative session, policymakers make decisions that affect businesses, how much they pay in taxes, how they hire employees, what regulations they must follow, what permits they need, what products they can sell, how they compete and what it costs to operate.
And when those decisions are being made, someone is usually in the room advocating for their interests. The question is whether that someone is you.
For many small businesses, the answer is no.
They assume their industry association or Chamber of Commerce is watching legislation. Or that the largest companies in their industry will make sure policymakers understand the issue. Or that someone else will speak up if a proposal becomes a serious problem.
Sometimes they are right, but there is a fundamental problem with that strategy: The interests of an industry are not always the same as the interests of every business within that industry.
A national corporation may want one solution. A regional company may want another. A 20-person business may have completely different concerns than a company with 20,000 employees.
An industry association has to represent a coalition of members, which inevitably means compromise. And the largest companies often have the resources to maintain not only their own government affairs operations and advocate directly for what matters to them, but also maintain larger amount of influence within associations and Chambers of Commerce.
That is rational behavior. But it means a small business cannot assume that someone else's solution will be its solution.
Imagine a state legislature considering a new regulation for your industry. A large corporation is involved in the discussion. It has government affairs professionals, attorneys and executives who regularly communicate with policymakers. They use their seat at the table to explain what it needs to continue operating profitably. Policymakers listen and a compromise is reached.
The legislation passes and the large corporation can comply with the new requirements.
But what if compliance costs the large company $500,000 and your business $50,000? What if the large company has an entire compliance department while you have eight employees? What if the large company can restructure its operations while your business cannot?
The policy may be perfectly reasonable for the company that helped shape it. It may be devastating for the business that had no voice in the process.
That is the danger of assuming someone else will advocate for you.