the dairy barn final

Letter of Transmittal

Team 6

Copeland Hall BUS202IAthens, OH 45701 Section A01___________________________________________________________________________

October 19, 2005

The Morning Business Cluster Faculty TeamCollege of BusinessCopeland HallAthens, OH 45701

Dear Morning Business Cluster Faculty Team: As you requested, our team prepared a report to recommend a marketing and management strategy for increasing the revenue and awareness of The Dairy Barn Southeastern Ohio Cultural Arts Center. Our market research survey provided much information and affected our decisions regarding the plan. This includes the current budget of The Dairy Barn; the opportunities The Dairy Barn has not yet explored, and a coalition with the surrounding cultural art centers of Southeastern Ohio. Our plan also includes ideas on how to improve The Dairy Barn’s current website by making it more appealing and functional, advertising strategies. We conducted a market research survey that demonstrates how little the local college community knows about The Dairy Barn.

There is no doubt that The Dairy Barn has the potential to be an international entity, and is well-known for their biennial Quilt National. However, being a nonprofit organization and located in a rural area makes it difficult for the organization to make enough revenue to keep it breaking even. Our goal is to increase revenues—not only deliver capital to keep it running, but also enough to grow and make The Dairy Barn organization widely recognized.

Business professionals, such as Sally Dunker and Jeff Chaddock, sparked our ideas regarding a coalition and also showed on ways to advertise at minimal costs. Minimal costs are integral to our strategies, and both professionals prepared us to accomplish these goals for The Dairy Barn.

Thank you for the opportunity to analyze The Dairy Barn and to recommend its strategic direction. Please inform us if we can be of further assistance.

Sincerely,

Group 6: Samantha Przygocki Laura SpottsBrady Sharrer Ryan WynnJason Simon

Push the LimitsA Look at How The Dairy Barn Will Increase its Revenue and its Awareness Locally,

Nationally, and Internationally

Prepared for

Tod BrokawDr. John Kiger

Dr. Arthur MarinelliDr. John Schermerhorn

Ohio UniversityAthens, OH 45701

Prepared by

Samantha PrzygockiBrady SharrerJason SimonLaura SpottsRyan Wynn

Ohio UniversityAthens, OH 45701

October 19, 2005

Table of Contents

Executive Summary........................................................................................................................iii

Introduction......................................................................................................................................1Company Overview.............................................................................................................1

Situational Analysis.........................................................................................................................1Current Mission...................................................................................................................1SWOT Analysis...................................................................................................................1The Current Website............................................................................................................2

Marketing Strategy...........................................................................................................................2Mission.................................................................................................................................2Objectives............................................................................................................................2Target Market Segments......................................................................................................3Marketing Communication..................................................................................................3The New Website.................................................................................................................5Working with the University...............................................................................................5Five-Year Coalition Plan.....................................................................................................6Our Vision for The Dairy Barn............................................................................................7

Management Strategy......................................................................................................................8Role of the Board of Trustees..............................................................................................8Employment.........................................................................................................................8

Implementation................................................................................................................................9Competition Strategy...........................................................................................................9How Can Success Be Measured?.........................................................................................9

End Notes.......................................................................................................................................10

References......................................................................................................................................11

Appendix A: Current Mission........................................................................................................13Appendix B: Nonprofits & its Board of Trustees..........................................................................14Appendix C: SWOT Analysis........................................................................................................20Appendix D: Illustration of Decline in Grant Money Awarded....................................................23Appendix E: Problems & Assets of the Original Website.............................................................24Appendix F: Four P’s & Four C’s: The Dairy Barn......................................................................26Appendix G: New Mission & Vision.............................................................................................28Appendix H: Part One: Porter’s Five Forces.................................................................................29

Part Two: Product/Market Expansion Grid.............................................................30Appendix I: Market Research Survey............................................................................................31Appendix J: Results of the Survey.................................................................................................32

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Appendix K: The Marketing and Management Budget.................................................................33Appendix L: Advertisement Table Display Card..........................................................................40Appendix M: T-Shirt Design.........................................................................................................41Appendix N: Example Radio Advertisement for Quilt National 2005..........................................42Appendix O: WOUB Radio Advertisement Rate Sheet................................................................43Appendix P: Example Press Release & Media Alert.....................................................................44Appendix Q: The New Website Pages...........................................................................................46Appendix R: How We Improved the Website...............................................................................48Appendix S: Five-Year Coalition Plan..........................................................................................50Appendix T: Revised Calendar of Events......................................................................................51Appendix U: Part One: Employment Agreement..........................................................................52

Part Two: Description of Employment Contract Clauses........................................64Appendix V: Porter’s Generic Strategies.......................................................................................71

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Executive Summary

The Dairy Barn promotes non-traditional artful forms of expression, centralizes and network such artful expression, and builds global appreciation thereby benefiting the art and surrounding community. We have collaborated and decided on a new strategy and several improvements that will aid The Dairy Barn in achieving this revised mission.

The main improvements include: An appealing and more functional website Widespread diverse advertising to increase recognition Hosting a variety of events throughout the year Forming a coalition that links artists and venues throughout southeast Ohio Increased involvement with Ohio University Expanding the role of the Board of Trustees

All of these improvements can be accomplished without having to spend large amounts of money. Although a webmaster would need to be hired to maintain the newly remodeled site, they would come be part time and would not be paid an incredible amount.

Advertising is crucial to The Dairy Barn. Recognition by both our targeted market segments will be increased though various ads such as table display cards, radio promotion, public relations, and marketing through its members. All of the advertising can be had at minimal cost to The Dairy Barn.

When the coalition comes together, combined events (such as an annual craft fair or show) will be formed and held, increasing recognition throughout the state and increasing revenue for all parties.

Increased involvement with Ohio University will increase awareness among the student body, drawing more students to The Dairy Barn’s events.

Finally, the Board of Trustees will expand its role to help promote The Dairy Barn. They need to put in extra time and effort to make The Dairy Barn’s vision a reality.

In the long run, we feel that The Dairy Barn can be very successful and create a globally recognized cultural arts center.

iii

Dairy Barn Analysis 1

Introduction

Original and innovative artistic forms of expression have, over the past 25 years, gained support and appreciation in the global community. New York City, Berlin, Paris, and London have become centers for this art, but such innovation can also be found in one of the most unassuming places—Southeastern Ohio.

A large population of talented artists who produce high quality contemporary art are scattered throughout the Appalachian region of Ohio. However, with the little resources this area has to offer, much of this quality art is unrepresented and invisible to the art community at large. Modest attempts have been made to build awareness of the art in this unique region, but only limited success has resulted. One of the most successful of these attempts occurred late in 1970; the revitalization of a dairy barn in Athens, Ohio1.

Company Overview

The Dairy Barn, as it is now called, was founded by a group of artists and art lovers to exhibit artistic talent that was unrepresented in the mainstream art community. This nonprofit organization continues to offer exhibition art today; however, they have greatly broadened their focus.

Situational Analysis

To fully understand how The Dairy Barn will increase its revenue and become a more successful business, its current situation must be looked at in several different ways. These include factors in its current mission and a situational analysis of its strengths, weaknesses, opportunities, and threats.

Current Mission

The Dairy Barn has evolved into an exhibition showcase promoting the community and artistic development of Southeastern Ohio. The vision of The Dairy Barn is to improve the quality of life of the immediate and extended region by promoting this community development (See Appendix A). In conjunction with their goals, The Dairy Barn has created itself as a nonprofit organization, which comes with certain limitations (See Appendix B).

SWOT Analysis

As detailed in Appendix C, The Dairy Barn’s strengths include Quilt National, a variety of offered classes, rental space, and the summer camp for kids. Weaknesses include its location and community, poor advertisement, its landscaping, and its lack of a kitchen in the bottom floor. Major opportunities that The Dairy Barn can explore include a regional coalition with other area art organizations and working with Ohio University. In addition, there are several threats to The Dairy Barn, including Ohio University’s Kennedy Museum and the fact that grants awarded have decreased over the past year for The Dairy Barn (See Appendix D).


The Current Website

Problems and Advantages. There are numerous problems with the current Dairy Barn website. Our analysis will cover the home page only. There are problems with its colors scheme, which, currently, is very bland. The fact that it employs neutral colors makes other colors added clash oddly. If they chose a different scheme, they could add more colors, but they would have to be in the same color “family” (warm or cool tones), instead of their current red (warm), orange (warm), and purple (cool).

In addition, there is a picture of a DVD on the main page that they are selling that is so blurry, it can’t be read. They use more than two fonts on the page, creating inconsistency, and the page itself is incredibly long. There are logos on the page, which appear to be links at first glance (the OAC and support logos), but turn out not to be—this should be remedied.

However, there are a few assets of the original site. There is a “mouse over” technique used on the buttons, and the page width is slim, so that the visitor doesn’t have to “maximize” the screen to see the entire content. There is also The Dairy Barn’s contact information along the bottom of the site, so that the visitor could find contact information from any page, in case the contact page didn’t work on their server (See Appendix E).

Marketing Strategy

In order to increase The Dairy Barn’s revenue, we have created a marketing strategy focused on increasing awareness and appreciation of The Dairy Barn. This new strategy involves an updated and more concise mission statement, clarified objectives, an advertising and promotional plan based on the results of a market survey, and a new website. In addition, working with the University can also open The Dairy Barn up to previously unexplored markets. Refer to Appendix F for our complete product and promotion analysis.

Mission

Our re-envisioning of The Dairy Barn is centralized around the core concepts it was founded on—to promote non-traditional artful forms of expression, to centralize and network such artful expression, and to build global appreciation thereby benefiting the art and surrounding community (See Appendix G). Our strategy to achieve such ends is highly focused, relying on a strict marketing and management plan devoted to the core concepts previously stated.

Objectives

To implement the new Mission, three essential objectives must be realized—increased revenue generation to allow for more focused expenditures, enhanced awareness of The Dairy Barn and its Mission, and expanded networking among the individual artistic entities in Southeastern Ohio. Achieving these objectives involves constantly observing and incorporating the mission into each one, so as to create a strict and focused strategy to achieve such ends as described in the mission.


The Dairy Barn's Target Market Segments

We are targeting a general audience that consists of adults, college students, and the elderly with an interest in the arts. We especially focus on the college students due to the large concentration in the area. We are also targeting parents of children from the ages of 3 to 12 for year-round art classes and summer camps. In addition we are targeting adults 35-60, with more means with which to act on their artistic interest. We have included an analysis of the market in Appendix H.

Survey. According to our survey (See Appendix I), many people, mostly students, around Athens have not heard of The Dairy Barn and many more have never visited it. Despite this, many of those surveyed did express an interest in visiting The Dairy Barn as well as becoming a member (See Appendix J).

Market Geographic. The Dairy Barn has the advantage of being in a region rich in cultural arts and scenic tourism. This helps The Dairy Barn draw in visitors interested in art from outside the region that would not have come. The number of different venues helps increase the traffic throughout the county. Although there is steady business from local customers, we hope to one day draw in more from outside the region.

Market Demographics. The people that come to The Dairy Barn are usually people who greatly appreciate art, like local students and artists. These people are not really of any specific gender or nationality. We aim to target students with excess income and professionals 35-60 who have more time and money for philanthropy. The Dairy Barn has low admission prices so a person of any economic status can enjoy their exhibits, but most members tend to be of the middle to higher economic status since most art galleries have higher admission prices.

Market Behaviors. Although The Dairy Barn can draw in people for their exhibits, customers usually will only visit one time per exhibit. So the length between visits can be quite lengthy.

Marketing Communication

We have developed a four-point promotional mix for The Dairy Barn for the purpose of increasing public awareness and appreciation. Advertising, promotional applications, public relations, and direct marketing are the four areas of focus that will best advance the above stated purposes. Refer to Appendix K for the budget of the promotional mix.

Advertising. This non-personal form of presentation targets broad market segments. Our advertisement plan is focused on increasing the general awareness of The Dairy Barn. To achieve this goal, we use a mix of low cost advertisement cards and T-shirts strategically located to achieve full benefit.

The table display cards offer an elegant, low cost advertisement solution (See Appendix L). With a gloss finish, contemporary design, and informative dialogue, combined with the


strategic placement of such cards, The Dairy Barn will achieve not only awareness, but an image concurrent with their mission. Strategic locations include, but are not limited to: The Athens County Convention and Visitors Bureau, Casa Nueva, The Donkey Cafe, The Import House, Brenen’s, Perk’s, The Oasis, and the Starbucks in Kroger.

The cost of such advertisement is between $120.00 and $150.00 for 1,000 glossy prints of custom work front and back2. The probability that the selected venues will support The Dairy Barn by offering free placement of the cards is high due to the amount of advertising flyers already displayed in each.

In addition to the place cards, T-shirts will provide indirect advertising. They innately possess a higher risk associated with them, as they are only effective when the person who owns the shirt wears it. Polo and long sleeved shirts also have potential, but require higher overhead cost. Polo shirts should be considered for future expansion of advertisement.

The T-shirt should have appeal to a younger audience to target the larger market of young adults (See Appendix M). The cost of T-shirt printing is substantially higher than the cards. The more T-shirts ordered, the cheaper the per shirt cost. Ordering 500 T-shirts (Small through Extra-Large) runs about $2,000.00 to $3,000.00, which includes custom art, text, and multiple colors (price dependent on number of colors)3.

Promotional Application. Short-term incentives and publicity of special events will bring higher volumes of people to The Dairy Barn. Such promotions not only assist in building awareness, but also develop appreciation. Radio advertisement and prize-based events will provide for a stable foundation in this aspect of the promotional mix.

WOUB Radio (NPR) provides for the best targeting of the markets most associated with The Dairy Barn. It is a wide-ranged radio station that reachs Athens, Cambridge, Ironton, Chillicothe, Zanesville, and a small radius of communities in these vicinities. The 15-second promotion is based off of a weekly price, and would be most effective one week before a small event, and two before major events. The promotion would be very direct and always include a standard saying or slogan to build customer recognition (See Appendix N). The cost associated with running the ad 15 times “Prime Time Only” is a the weekly rate of $150.004 (See Appendix O).

Public Relations. Favorable publicity is essentially free advertisement. However, even more than advertisement is the positive connotation associated with such favorable publicity. In many industries, like the restaurant industry, publicity is the prime source of advertisement. We see The Dairy Barn benefiting in the way of awareness through public relations, but more importantly, we see The Dairy Barn building a strong public appreciation due to high public relations involvement.

Reaching the people through “news” rather than “ads” brings a new incentive to the people—one without sales-directed communication. In a sense, this form of advertisement is more believable. The steps to good public relations involve public service announcements, press releases to all forms of media, and a follow up media alert (See Appendix P).


Direct Marketing. Direct marketing targets carefully selected segments to obtain both an immediate response and cultivate lasting customer relationships. Postal mail, e-mail, and telephone are the main mediums through which such marketing is generally accomplished.

The Dairy Barn can rely on its membership database to perform such target marketing. We suggest, unless this development is already in place, that The Dairy Barn database include such fields as income, interests, location, and major events attended. With this system implemented, specific segments could be targeted for specific events.

The New Website

How We Improved the Site. As detailed in Appendix Q, we improved the website in numerous ways. The Dairy Barn logo is now larger, and docked in the left-hand corner, which makes it the first thing the eye sees upon opening the page in the browser. We changed the color scheme to allow for more variety of color; colors are in the same color family also. We’ve added a large colored text box displaying the gallery hours prominently, making it easier to find. We made all The Dairy Barn site buttons the same color, and differentiated the Quilt National and Bead International buttons, and made all of the logos on the page links. In addition, there is now a link for classes that The Dairy Barn offers, so that there is a link to an actual revenue-making source for the organization (apart from the exhibit and support, which are slightly more minimal). Above all, we fit all the content and more into less than half of the space of the original site (See Appendix R).

We would also like to see some changes in The Dairy Barn’s online gallery store. We feel they should photograph and display all the art they are selling, especially the one-of-a-kind art, on their website. After the exhibition is over, unsold art would be placed on the website, allowing for those outside the region, or those who could not attend the exhibit could buy them.

The Dairy Barn should also attempt to link itself to other art websites within the region and state, including the Vern Riffe Center for the Arts and Kennedy Museum (Southeast); the Dayton Art Institute and the Cincinnati Art Museum (Southwest); Hello From the Cultural Arts Center, the Ohio Craft Museum, and the Wexner Center for the Arts (Central); the Museum of Ceramics and the Beck Center for the Arts (Northeast); and the Milan Historical Museum (Northwest).

Working with Ohio University

Fraternities/Sororities and Community Service. Nearly all fraternities and sororities are required to have a specific amounts of service hours per quarter. The organizations usually dedicate a few days to go out, as a group, and service an organization of some sort. This would be a great opportunity for The Dairy Barn to take advantage of. This is a way to get landscaping services or a variety of other things done with no labor costs. The Dairy Barn could simply inform the fraternities and sororities that some services are needed and set a date and time. Also, there are 33 combined fraternities and sororities at Ohio University and


they make up 13 percent of the student population. (cite) Getting at least one group to take on some work for The Dairy Barn would create a large workforce and many projects could be accomplished.

Residence Life. Residence Life is a great outlet to introduce students to The Dairy Barn, and help them get involved. Every quarter, Resident Assistants are required to host “programs”, where students do various activities together, some of which are educational. The Dairy Barn could give special discounts to groups that RAs bring to The Dairy Barn to participate in classes offered. This would bring a somewhat steady amount of income to The Dairy Barn, especially if a few RAs every quarter were hosting events there. In addition, Residence Life requires its entire staff to work in some form of community service—The Dairy Barn could employ a few RAs (usually these groups are all the staff in one building, about seven or eight people) for a day, or work with them for a whole school year as volunteers. This would help cut costs for The Dairy Barn in the form of payroll.

OU Tuition. We explored the idea of working with Ohio University and its admissions department by adding an optional provision on the quarterly bill (similar to the Student Advocacy Fee) for The Dairy Barn. This quarterly donation could be waived, but this idea was not feasible. After speaking with the Dean of Students, Terry Hogan, he informed us that it is against University Policy to favor one organization over another in this fashion5.

Five-year Coalition Plan

The marketing capability of The Dairy Barn has limited potential in its current state. Individual growth and creative potential create limits to the boundaries of these marketing capabilities. To increase both of these factors, we propose a five-year coalition plan to develop a cooperation and organization of the surrounding artistic entities which coincide with the mission of The Dairy Barn (See Appendix S).

The Dairy Barn should view itself as the epicenter in southeastern Ohio, and eventually a larger geographic region, for the development, discovery, and promotion of contemporary and innovative forms of artful expression. Therefore, The Dairy Barn should be the proactive leader in the creation of a coalition to better achieve its goals. The first step in such a plan is believing strongly that The Dairy Barn is the anchor and center for the arts in the surrounding area.

Year One Coalition Plan. In the first year development, The Dairy Barn should discover which target entities to include in the inauguration of the coalition. We suggest the following: the Athens Area Municipal Arts Council, the Kennedy Art Museum, the Hocking Hills Marketing Arts Consortium, the Nelsonville Historic Public Square, and Passion Works Studio.

The inauguration of the coalition should be the creation of an event, hosted by The Dairy Barn, involving all members of the coalition, proportionally, to advertise and promote the event. The main function of the event should be to advertise the contemporary and innovative arts, the coalition, and the individual members of the coalition. We have examined The


Dairy Barn’s events schedule, and deemed May as the appropriate time for the annual event (See Appendix T).

The final stage of year one is a control phase. A feedback meeting should be hosted by The Dairy Barn to evaluate the event, provide encouragement for future events, and plan a meeting before the event to be hosted in the following year. The key to the success of this meeting is the ability of The Dairy Barn to take on a leadership role.

Year Two Coalition Plan. The second year of the coalition plan begins with a planning meeting for the year’s event. Unlike the first event, The Dairy Barn will take a leadership role but will use “participative planning”. Again, after the event a control will occur where feedback is generated. This year will also employ monthly meetings to discuss continual marketing efforts for the coalition.

Year Three Coalition Plan. Year three follows the same guidelines as year two. However, there should be an effort to host an additional event. With the increased awareness of The Dairy Barn, the coalition, and the members of the coalition, the third year is an opportune time to introduce a second event, perhaps in the fall.

Year Four Coalition Plan. By the fourth year, the goal is to have high awareness and appreciation of all entities involved in the coalition, and the coalition itself. After three years of events and two years of substantial marketing, the fourth year should attempt to introduce seasonal events, along with bi-monthly meetings to bring more integration between the members of the coalition. Such benefits as database merging, inter-member advertisement, and sales support by The Dairy Barn’s gift shop and e-commerce for the members, should be substantial.

Year Five Coalition Plan. In the fifth year, the coalition should be well grounded and expansion should be the top priority. This expansion should be a collaborative effort. Appointing a supervisor position supported by the members of the coalition, should also be present. Our Vision for The Dairy Barn

Great things are expected for The Dairy Barn, but much work and time is needed to accomplish these goals. We would like to see The Dairy Barn increase its stability financially, secure its place as an internationally recognized organization, and have a 100 percent increase in membership. We would also like to see an increase in the number of events that The Dairy Barn holds, so that its entire calendar is full.

Furthermore, we believe The Dairy Barn should develop five and ten year plans for itself, to keep its goals in mind and on track. These plans would include things such as development and housing; for example, an artists’ temporary residence or a café on the property. The residence would run concurrently with the programming of The Dairy Barn.


Management Strategy

In order to implement our plan, we believe that The Dairy Barn’s Board of Trustees will need a slightly revised vision, and that The Dairy Barn will need to employ a webmaster to oversee its website. We believe that there is no reason to change the basic infrastructure that The Dairy Barn already employs in its managerial organization.

Role of Dairy Barn’s Board of Trustees

As detailed in Appendix B, The Dairy Barn’s Board is supposed to create policies and procedures. After they are created, then the board must enforce them. They are also supposed to drive their vision and their goals. This is more of the technical aspect of the board. However, in reality, the board handles the financial aspect, engagement in the community, and offers leadership for the corporation6. Examples of these would include structuring events and using The Dairy Barn’s resources, maybe to maintain the parking lot or other repairs that are needed.

Throughout a year, The Dairy Barn Board will meet once a month. Approximately 60 hours a year per board member are dedicated to improving The Dairy Barn.

Employment

Webmaster Position. The Dairy Barn will need to employ (See Appendix U) a webmaster to maintain its website. We recommend a part-time position, updating the website as needed, one day about every one or two weeks. The webmaster would be responsible for maintaining all content within the site. They would correct any errors in the script, and provide user support, such as a Frequently Asked Questions page or “Search” feature within the site. They would maintain any site maps and validate that the links are active and go where they claim. The webmaster would also be responsible for maintaining any mirror sites of The Dairy Barn (i.e. Quilt National). Above all, the website should be able to be accessed from various servers and browsers.

The average salary for a webmaster in Chillicothe is around $65,291 annually7. Broken down daily, this allots about $179/day. If the master worked two days a month, or once every two weeks, for 12 months, they would need to be paid a salary of about $4,296 for the year. This would be affordable for The Dairy Barn as we’ve laid out in our budget (See Appendix K).

The Dairy Barn could consider employing a student from the College of Business in the field of Management Information Systems or an Engineering student specializing in Computer Science (if they have experience with web development). This student would have registered for MIS 497 (or some similar class), which is an independent study class, where the student would get class credit for work done, instead of being paid. However, there are several reasons why we advise against this. One, the student would only be able to be around for one quarter at a time, and some of them would be more or less experienced than others.


Secondly, there would (most likely) be no students available during winter intercession and summer break, unless they were a paid intern.

Implementation

In order for the marketing and management strategies we’ve created to be deemed a success, there must be an obvious strategy to deal with competition, and a way to measure success.

Competition Strategy

Porter’s Generic Strategies (See Appendix V) answers the question, “How can we best compete for customers in this industry?” Business-level strategic decisions are driven by the market scope (broad or narrow market) and source of competitive advantage (price or uniqueness). The model then describes the different competitive decisions a company can make: differentiation, cost leadership, focused differentiation, or focused cost leadership8.

We feel that The Dairy Barn uses a focused differentiation strategy. This strategy means that the organization’s resources and attention are directed toward minimizing costs to operate more efficiently than the competition9. The Dairy Barn is quite unique as it offers different kinds of art, such as quilts, beads, and other local pieces. It has a unique setting—the hills of Appalachia. Its market, Southeast Ohio, is a narrow market for a company to focus on.

How Can Success be Measured?

Success can only be measured by how effective The Dairy Barn’s new marketing plan and other strategies are. Much depends on advertising; The Dairy Barn must get their name out and establish themselves as a cultural arts leader in southeast Ohio, the nation, and eventually the world. It all starts locally. The Dairy Barn needs to expand their calendar and host more events throughout the year.

In addition, The Dairy Barn needs to establish connections in the local community. Working with Ohio University and establishing a coalition with other local arts venues is a great place to start. Their website needs to be improved, as this is a link between them and people who have a passion for the arts. Their online store also needs to be improved in order to increase revenue and have their reputation grow as a seller of fine and rare art.

If all of these are accomplished, we feel that The Dairy Barn will be very successful and grow into a global arts leader. Down the road, we also feel that if they expand by adding an artists’ residence or a café, all the pieces will fall into place. The Dairy Barn has the potential to be a regional, national, and global arts leader. The Dairy Barn needs to start harnessing that potential and use it to its advantage.


End Notes

1. Hilary Fletcher. “Quilt National.” n.d. http://quiltnational.com (accessed Sept. 25, 2005).

2. Overnight Prints. n.d. http://www.overnightprints.com (accessed Oct. 15, 2005).

3. Custom Ink n.d. http://www.customink.com (accessed Oct. 17, 2005).

4. Loring Lovett. “WOUB Rates.” 10 Nov. 2005. Personal e-mail (n.d.).

5. Terry Hogan, “RE: New Student Registration Donation.” Email from author, 16 October, 2005.

6. Jeff Chaddock. Interview by Ryan Wynn. Board of Trustees. 13 Oct. 2005.

7. Salary.Com Salary Wizard. Oct. 2005. http://swz.salary.com/salarywizard/layoutscripts/swzl_compresult.asp?narrowcode=IT02&jobcode=IT10000153&metrocode=35&metro=Chillicothe&state=Ohio&geo=Chillicothe,%20Ohio&jobtitle=Webmaster&narrowdesc=Internet%20and%20New%20Media (accessed Oct. 15, 2005).

8. John R. Schermerhorn. Core Concepts of Management. Hoboken, NJ: John Wiley and Sons, Inc., 2004.

9. Ibid.

http://www.customink.com/


References

Armstrong, Gary and Philip Kotler Marketing: An Introduction. 7th ed. Edited by Katie Stevens Upper Saddle River, NJ: Pearson Education LTD., 2005.

Athens County Calendar of Events.” Athens County: Official Visitors Guide, 2005, 43-49.

Baldwin’s Ohio Revised Code - Chapter 1702, Nonprofit Corporation Law.” 2005.

Boeing Company, The. 2005. Employee Agreement [online]. Onecle.com. [cited 18 October 2005]. Available from the World Wide Web: (http://contracts.onecle.com/boeing/mcnerney.emp. 2005.06.29.shtml).

Calendar of Events.” Art of the Hocking Hills, 2005, 3-4.

Chaddock, Jeff. Interview by Ryan Wynn. Board of Trustees. 13 Oct. 2005.

Custom Ink n.d. http://www.customink.com (accessed Oct. 17, 2005).

Fletcher, Hilary. “Quilt National.” n.d. http://quiltnational.com (accessed Sept. 25, 2005).

Hogan, Terry, “RE: New Student Registration Donation.” Email from author, 16 October, 2005.

Kmart Management Corporation. 2004. Employee Agreement [online]. Onecle.com. [cited 18 October 2005]. Available from the World Wide Web: (http://contracts.onecle.com/kmart/whipple.emp. 2004.06 .01.shtml).

Krispy Kreme Doughnuts, Inc. 2004. Employee Agreement [online]. Onecle.com. [cited 18 October 2005]. Available from the World Wide Web: (http://contracts.onecle.com/krispy-kreme/phalen.emp.2004.01.06.shtml).

Lewis, Andrea. “The Dairy Barn.” 2004. http://www.dairybarn.org. (accessed September 26, 2005).

Lewis, Andrea, “Re: Financial Information.” Email from author, 28 September 2005.

Lovett, Loring. “WOUB Rates.” 10 Nov. 2005. Personal e-mail (n.d.).

Mancuso, Anthony. How to Form a Nonprofit Corporation. Edited by Lisa Guerin. Berkeley, CA: Nolo, 2002.

Ohio University Tour Guide Manual 2005-2006. Athens, OH: Ohio University, 2005.

Overnight Prints. n.d. http://www.overnightprints.com (accessed Oct. 15, 2005).

http://www.dairybarn.org/

http://www.customink.com/


Salary.Com Salary Wizard. Oct. 2005. http://swz.salary.com/salarywizard/layoutscripts/swzl_compresult.asp?narrowcode=IT02&jobcode=IT10000153&metrocode=35&metro=Chillicothe&state=Ohio&geo=Chillicothe,%20Ohio&jobtitle=Webmaster&narrowdesc=Internet%20and%20New%20Media (accessed Oct. 15, 2005).

Schermerhorn, John R. Core Concepts of Management. Hoboken, NJ: John Wiley and Sons, Inc., 2004.


Appendix A

Current Mission

Mission The Dairy Barn Arts Center offers exhibitions, events, and educational programs that nurture and promote area artists and artisans, develop art appreciation among all ages, provide the community access to fine arts and crafts from outside the region and draw attention and visitors to Southeast Ohio.

VisionWith the vision of improving quality of life, and with quality as the benchmark, The Dairy Barn brings the world of the arts to all of the differing audiences in the region by providing programs that make the arts accessible and engaging to people of all ages and abilities.

Lewis, Andrea. “The Dairy Barn.” 2004. http://www.dairybarn.org. (accessed September 26, 2005).

http://www.dairybarn.org/


Appendix B

A Nonprofit Corporation and its Board of Trustees

What makes a nonprofit organization “special”?

When a company is listed as a nonprofit corporation, they receive special benefits that regular profit corporation do not receive. For example, all nonprofit corporations are tax exempt, meaning that they do not have to pay federal income taxes. (1702.80) A nonprofit corporation usually has other organizations as members, and at least twenty of its members are also tax exempt. (1702.80)

Furthermore, nonprofit corporations along with its members, either own, lease, occupy, or use an area of land not less than three hundred acres. (1702.80)

Funding a Nonprofit Corporation

Most nonprofit corporations do not issue shares, nor do they provide investment incentives such as return on capital through the payment of dividends to investors, benefactors, or participants in the corporation.

However, nonprofits have their own means of obtaining funds. The most common method is to obtain revenue in the form of contributions, grants, and dues from the people, organizations, and governmental agencies that support the corporation’s purpose and goals. (2) Nonprofits will also receive initial and ongoing revenues from services or activities provided in the pursuit of their exempt purposes. These can include payments for art lessons or dance courses, school tuition, clinic charges, etc.

Workers’ Compensation

Workers’ compensation insurance coverage compensates workers for losses caused by work related injuries and protects the corporation from lawsuits brought to recover these amounts. This coverage is mandatory in some states, but optional in others. Nonprofits should always have this coverage to save them from those expenses that would result in a work-related injury.

What is a Director?

Corporate directors, who meet collectively as the board of trustees in a nonprofit organization, are responsible – legally, financially, and morally – for the management and operation of the nonprofit corporation.

Baldwin’s Ohio Revised Code - Chapter 1702, Nonprofit Corporation Law.” 2005.Mancuso, Anthony. How to Form a Nonprofit Corporation. Edited by Lisa Guerin. Berkeley,

CA: Nolo, 2002.


Number of Directors

The number of directors on the board should never be less than three, or if the company is really small, the number of directors should never outnumber the members of the company. If a company wants to increase the size of its board, the board members who have the power to vote for new members must meet and vote on it. In this case, a simple majority is needed. (1702.27)

Qualifications of Directors

Qualifications may vary with what type of business the organization is involved in, but most of the same skills are needed. For example, a director must possess three main skills: practical qualifications, community relations, and ability to qualify for tax exempt status.

Practical qualifications include strong managerial, technical, and financial skills. As for community relations, a director must be able to strengthen the company’s link with supporters and benefactors and have connections with the more prominent people in the community. All of these help to raise money, increase recognition, and gain new clients. Lastly, the IRS likes to see members “disinterested in money” and who have an interest in the community. Public officials are crucial here, the IRS asks for them specifically on their tax form (IRS Form 1023).

There are other key qualifications to consider as well. Board members should be willing to serve the company and have a proven commitment to the goals of the organization. Enough board members must be chosen to ensure a wide basis of support, especially in regards to fundraising. But, the board must not be too large where it becomes too difficult to manage and get work done. Broad practical skills and real world savvy are a must.

Furthermore, some board members should have fundraising experience. Some nonprofits will even keep a fundraising expert on staff. Lastly, at least one board member needs to have experience managing money, such as a professional accountant or someone with expertise in recordkeeping and budgeting. Managing money is crucial because this is where most nonprofits will fall into legal trouble and be liable if the records are not kept correctly.

The Term of a Director

The term of office for directors is commonly set in the corporation’s Bylaws, but it is usually one year. Other ways to terminate a term and elect a new director include resignation, voluntary removal from office, or death. (1702.28)

Director Compensation

Nonprofit directors usually serve without compensation. However, the company will pay for any expenses, such as travel or supplies. Not paying nonprofit directors reinforces one of the important legal and ethical distinctions of the nonprofit corporation: its assets should be used


to promote its goals; not for the private enrichment of its incorporators, directors, agents, members, or employees.

Election of New Directors

At a meeting in which directors are to be elected, only nominated candidates are eligible for election. (1702.26) To be elected, one must simply receive the highest number of votes.

To fill a vacancy caused by resignation or death, the board members must come together and vote on a new director. This number must be a majority of the current numbers of board members. (1702.29)

Authority of Directors

Essentially, the director is to act in the best interest for the company. A director is required to handle their duties and tasks in a timely manner. It is possible that a director might be on a committee, so it must handle its responsibilities of that committee. Also, a director is entitled to rely on information, opinions, reports, or statements, including financial statements and other financial data. (1702.30) These are prepared by other directors, officers, or employees of the company, public accountants or other experts, and other committees within the board.

To determine if the director was acting the best interest for the company, one must consider several factors. First, a director must consider the interests of the employees, suppliers, creditors, and customers of the corporation. Second, it needs to consider the economy of the state and of the nation. Third, community and societal considerations must be weighed carefully. Last, the long-term and short-term best interests of the corporation, including, but not limited to, the possibility that those interests may be best served by the continued independence of the corporation. (1702.30)

If a director fails to perform any of the preceding, a termination, potential termination, or termination of a specific relationship with the company can and will be exercised. (1702.30)

Meetings of Directors

Meetings of the directors may be called by the chairperson of the board, the president, any vice president, or any two directors. (1702.31) Meetings can be held at any place within or without the state, or through appropriate telecommunications. All members of the board must be notified at least two days in advance of the meeting and this can be through the mail or through appropriate telecommunications. At the meeting, an announcement is made at the beginning to when the meeting will be will adjourned. (1702.31)


Quorum for Directors’ Meeting

In order to hold a directors’ meeting, a majority of the authorized number of directors is necessary to constitute a quorum. (1702.32) Having a majority at which a quorum is present is the act of the board, and may also be laid out in the company’s bylaws and regulations.

Committees Established by the Board

Executive Committee

The full board of trustees usually delegates a part or a significant amount of the board’s duties to an “executive committee” of two or more directors. This arrangement works really well when some board members are extremely committed to working long hours for the well-being of the nonprofit corporation.

More passive members are always kept abreast of what the executive committee is doing. The full board should receive timely reports of executive committee meetings and have the chance to consider any decision that the executive committee has made. The full board has the power to overturn any decision if they disagree with it.

Other Committees

The board typically appoints several specialized committees to keep track of and report on corporate operations and programs. These may include finance, personnel, buildings and grounds, new projects, fundraising, or other committees. These committees, often consisting of a mix of directors, officers, and paid staff, do not normally have the power to take legal action on behalf of the corporation; their purpose is to report and make recommendations to the full board or the executive committee.

Furthermore, all of these other committees are subordinate to the executive committee. All of the subordinate committees’ decisions are subject to approval by the executive committee. These sub-committees are useful as they utilize specific talents of board members.

Director Self-Dealing

Directors must guard against self-dealing, that is, involving the corporation in any transaction in which the director has a material financial interest. Examples of this include the purchase and sale of property, investment of funds, or payment of fees/compensation. The nonprofit corporation laws of most states include special rules for validating self-interested director decisions of this sort. In most cases, the interest of the director must be disclosed prior to voting and only disinterested members of that board may vote on the proposal.

Director Indemnification and Insurance

Law requires a corporation to reimburse a director for legal expenses incurred as a result of acts done on behalf of the corporation, if the director is successful in the legal proceeding.


Directors’ liability coverage is a way to insulate directors from possible personal liability for the actions on behalf of the corporation. But, for smaller companies, this may be quite unrealistic. For smaller nonprofit organizations, the best plan of action is to minimize potential risks that might arise in the pursuit of the company.

Limitation of Actions

No members of a corporation, especially the board of trustees, may make, issue, deliver, transmit by mail, or publish any prospectus, report, circular, certificate, statement, balance sheet, exhibit, or document, respecting membership rights in, or the activities, assets, liabilities, earnings, or accounts of, a corporation that is false or misrepresentative of the facts. (1702.54)

In addition, anyone having charge of any books, minutes, records, or accounts of a corporation, make therein any entry that is false in any material respect, knowing such entry to be false, or remove, erase, alter, or cancel any entry therein, knowing that the entries resulting from those actions will be false will also receive punishment (1702.54)

If one commits any of these actions, he/she shall be personally liable, jointly and severally, with all other persons participating with the person in any such act. (1702.54)

Liability of Directors

The directors of a corporation should not be personally liable for any obligation of the corporation. But if there are liability problems, they usually come in the form in distributing assets to members contrary to law or the articles and in making and granting loans to an officer, director, or member of a corporation. (1702.55) If any of these actions occur, the person shall be jointly and severally liable to the corporation.

If the director is held accountable for either action, he is liable to pay back the money that was loaned. (1702.55) He can not pay less back, nor can be pay more back; it has to be the exact amount that was loaned. However, there is a gray area with this. If it is found that the director was acting in good faith or relying on documents that were provided by the person who was handling the finances or a certified public accountant, he shall not be liable as long as the previous can be proven as true. (1702.55)

If it can be proven that the director was acting alone, no action shall be brought by or on behalf of a corporation. (1702.55)

How to Avoid Liability Problems

As previously states, directors are usually not held liable for corporate acts, but they can be in extreme cases of mismanagement. To avoid being liable for any action, all board members, whether active or passive, should attend board meetings and stay informed of, and participate in, all major board decisions. This way if the board makes a wrong decision, an individual board member would not be liable if he/she voted “no” on the decision.


Most of the time, things that put board members at risk of personal liability include bas financial management, such as failing to pay taxes, or not keeping proper financial records that show how much money is being collected and disbursed. It makes sense to always have an experienced financial manager on the board to avoid these previously stated problems.

Continued Existence

Every nonprofit corporation needs to file with the state’s Secretary of State a verified statement of continued existence. This document is signed by a director, officer, or three members in good standing. It includes setting forth the corporate name, the place where principal office of the corporation is located, the date of incorporation, that fact that the corporation is still actively engaged in exercising its corporate privileges, and the name and address of its appropriate agent. (1702.59)

The nonprofit corporation needs to do this every five years after the initial continued existence document is received. If the company fails to do this, the state’s Secretary of State will cancel the articles of the corporation, or basically suspend them from being an official licensed nonprofit organization. If this occurs, the corporation has a year to fill out the paperwork to get reinstated. (1702.59)

the dairy barn final

Documents

dairy barn organization

dairy barns current

dairy barn26appendix

current budget

business professionals

current mission13appendix

market research survey

copeland hall bus202i