Marshall Museum must figure out a way to reverse their deteriorating financial condition so that they can continue to provide an inviting setting for the appreciation of art.
Marshall Museum of Art is located approximately six blocks from the museum”s previous site and offers extensive parking availability and access through public transportation. This suggests that the museum is in a prime location, which does not inconvenience the museum”s current members. Also, it is easily accessible by most of the public, regardless of age. Adults and students who do not drive can still get there with great ease and seniors ride public transportation for free, which makes it convenient for them as well.Order now
One of the museum”s greatest strengths is that their new facility was publicly mandated. The citizens of Fannel County along with Jonathon Marshall, a major benefactor of the museum, provided the setting for the continued appreciation of art and its history.
MMA saves a great deal due to its 475 volunteer workers who are in addition to the staff consisting of 185 employees. These volunteers help run the museum”s profit centers, such as an in-house restaurant, gift shop, and special exhibitions. Volunteers provide tours, assist at the information desk, and are invaluable in recruiting new members and renewing existing ones. Without them, Marshall Museum”s costs would be through the roof.
The MMA has many programs directed toward educating the public. Among these are public programs such as adult tours, school tours, lectures, art films, and feature films. The MMA engages in programming to create community involvement and lends performing space to local performing arts organizations.
MMA is unable to display all of its collection at the same time because of space limitations. Artworks in the collection have to be rotated, with some being periodically loaned to other museums.
The three consecutive years of losses followed seven consecutive years of either break-even or low profitable status. The cumulative loss of $794,066 has depleted MMA”s financial reserves. This does not lead to increased profit speculation in the near future.
MMA has not spent enough time building a positive image for itself. Some would say they have no image at all. There is nothing about it that looks inviting or even hints to what wonders reign within.
Membership revenues are down for the 5th consecutive year. Unfortunately, membership represents the single largest source of revenue for the museum since it is a non-profit organization.
Opportunities: – special events or exhibitions
Special events and exhibitions have proven very profitable for MMA. However, there was limited availability of special events for the year 2000 and a decline in the number of scheduled events. If MMA can utilize its community involvement and coax people to fund more special events and exhibitions, they can seize the opportunity to increase annual profits and turn around their current deteriorating financial status.
Additional membership categories below $50 and for students and senior citizens can also provide new opportunities to attract segments of the population that had not typically yielded members in the past. These new memberships would welcome more citizens to reap the membership benefits of the museum and would offer more incentive for patrons to renew their memberships at the end of each year.
Marshall Museum of Art has limited space to provide their collections. Because of this, they need to be selective when choosing what to display. Members and walk-ins may come to see certain pieces or collections and be disappointed when they are not made available to view. They may have to travel to other museums that MMA lended their works to due to lack of space. A museum can only as valuable as the works of art they hold.
If their losses continue, the appropriation from Fannel County will decline. The county has, in the past, appropriated about $2 million annually to the MMA. The museum does not forecast any more than $1.6 million in county appropriation in the foreseeable future.
Low interest rates in 1999 and 2000 indicated that earnings from the MMA endowment and investments would probably remain flat or decline. As with any investment, fluctuating interest rates have a profound affect on profits. MMA needs to hedge against these risks if it aims to stay afloat in a non-profit industry.
There were numerous alternatives presented in this case for Marshall Museum of Art. A 10% reduction in personnel and administration costs was seen as a possibility. This, however, would lead to more dependence upon volunteers whom are in no way obligated to the museum. Marshall Museum could focus more attention to creating its image for the community. This was people will know its there and feel more compelled to stop by and visit. Museum staff suggested that they impose an admission fee of $1 per adult. Visitor surveys had shown that 50% of nonmember visitors said that they would be willing to pay a $1 admission fee for viewing the permanent collection. They could also implement student and senior membership fees at $30. The need for institutional advertising was raised, since the MMA has only been promoting special exhibitions and events. The benefits given to members could be increased so that members are more willing to renew their memberships. For example, raising discounts in their profit centers to 20% was suggested.
Given the limited expense budget for MMA, some of the above are not feasible alternatives. Improving member benefits, raising discounts in the profit centers, and charging an admission fee seemed to be the most efficient choices.
Of the above alternatives, I would recommend implementing the $1 admission fee for adults. Surveys have already proven that people are willing to pay to view the collections. This way, MMA can take the profit earned from admissions to increase member benefits and to create an image for themselves. Both of these factors would in turn lead to increased membership, which is exactly what Marshall Museum of Art could use.