Thus, ASIB’s current journal operations yield a net profit of $44,400 ($260,000 – $215,600) that can help support other ASIB activities. ASIB has a Web site that it constructed at a cost of $30,000 three years ago. One of ASIB’s staff members spends approximately half of her time managing the site. One-half of this staff member’s salary and benefits, along with other recurring expenses, such as software licenses and computer upgrades for the Web site, totals about $40,000 per year. Mario explains to you that one of the ASIB’s greatest cost reduction successes was last year’s decision to offer the monthly newsletter by e-mail. About half of the members chose to receive the newsletter by e-mail. The paper newsletters cost 50 cents each to print and mail, but creating and sending the e-mails took less than $50 worth of staff members’ time. Thus, ASIB realized an immediate savings of about $700 (50% × 3000 × $.50 of mailing costs saved, less the $50 cost to send e-mails) each month, or $8400 per year.

All ASIB members receive a copy of this journal and ASIB sells about 1000 subscriptions to the journal at $50 (a total of $50,000 per year). The total subscription revenue from the two journals is $200,000 per year. International Business Today sells advertising that yields about $60,000 per year. ASIB uses that total revenue of $260,000 to cover the costs of producing and mailing both journals. The cost of producing one issue of either journal, which includes proofreading, editing, and typesetting costs, is about $2000. The printing and mailing costs, which have been increasing rapidly over the past several years, average about $3 per journal (the mailing costs to some members are much higher than others because they are located in distant countries). Each year, ASIB produces 16 issues (four of the academic journal and 12 of the business journal) and mails 61,200 journals (13,200 of the academic journal and 48,000 of the business journal) to members and subscribers at a total cost of $215,600 (16 × $2000 plus 61,200 × $3).

The conferences generate about $50,000 per year; that is, conference and exhibitor fees exceed the costs of running the conferences by that amount. This $50,000 is used to cover general ASIB operating costs. One of the journals, Annals of International Business, has an academic focus and is read by researchers interested in international business topics. All ASIB members receive a copy of this journal and ASIB sells about 300 subscriptions to the journal at $500 (a total of $150,000 per year). Most of the subscribers are university libraries. This journal is published four times each year. The second journal, International Business Today, is written for business executives. It includes articles and features that report on current trends in international business and is published monthly.

The Association for the Study of International Business (ASIB) is an organization of researchers, professors, and business executives interested in the study, analysis, and promotion of business activities beyond domestic borders. Mario DiPonetti, ASIB’s executive director, has hired you as a consultant to help him map out a future Web revenue strategy for the association. The ASIB has about 3000 members located in countries throughout the world; however, about half of its members are in the United States. Each member pays an annual membership fee of $100, so ASIB’s dues revenue totals about $300,000 per year. ASIB sponsors two conferences each year; it also publishes a monthly newsletter and two journals.