1

Elements of a Basic Economic Challenge

Scarce resources Time Money

Alternative Uses of those Resources

2

Common Resources

Land

Labor

Capital

3

Land

FarmlandParklandOpen SpaceWaterAir MineralsFossil FuelsReceptacle for waste products

4

Labor

Time

Muscle Power

Brainpower

5

Capital

BuildingsMachineryEquipmentRoadsBridgesTunnels

6

Components in Economic Decision Making

What goods and services?How are they produced?For whom are they produced?How extensively are resources used?

7

Questions every economy must answer…

What should be produced?How many should be produced?What methods should be used?How should the goods be distributed?

8

Two Kinds of Economies

Command economy

Market economy

9

Characteristics of a Pure Market Economy

Economic freedomEconomic incentivesCompetitionPrivate ownershipLimited government

10

Demand Curve

PriceDemandRelationship between price and demandPrice goes down, demand goes up

 

    

11

Supply Curve

QuantityPriceRelationship between quantity and pricePositive relationship = price increases so does quantity supplied

   

12

Equilibrium Price

If the demand increases, the demand curve would shift up and right, and the equilibrium price would increase.If the demand decreases, the demand curve would shift down and left, and the equilibrium price would decrease 

 

13

A Comparison of Four Types of Market Structures 

Market Number of firms

Control over price

Type of product

Entry Competition

Pure competition

Very large None Standardized Very easy Price-based

Monopolistic competition

Large Small Differentiated Fairly easy Non-price

Oligopoly Few dominant firms

Fair amount of control

Standardized or differentiated

Difficult

Non-price competition for differentiated products

Monopoly One Large One Blocked to other firms

Non-existant

14

Bonds

Bearer Bonds

Registered Bonds

15

Inflation

Demand-pull

Cost-push

16

What is Economics Then?

MacroeconomicsMicroeconomicsEconomies of scaleLaw of Diminishing ReturnsLaw of Increasing Costs

17

Concerns of Unions

Job securityWagesJob safetyMedical benefitsInsurance benefitsPension plans

18

Key Labor Laws

National Labor Relations ActNorris-LaGuardia ActTaft-Hartley ActLandrum-Griffin Act

19

Common Contract Issues

PayFringe benefitsBonusesWorking conditionsJob security

20

Organization Handbook Components

Statement of objectivesOrganization historyOrganization chartJob descriptionsPersonnel policies and proceduresTerms and conditions of employmentHolidays and vacationsEmployee benefits and services

21

Common Types of Organizational Structures

Primitive Structure or Agency StructureFunctional StructureProduct StructureTerritorial StructureCustomer StructureMixed Structure

22

Primitive StructureSmall Town USA

 “A” Baseball FranchiseOrganizational Chart

      

Founder

Employees

23

Internal Factors Influencing Structure Development

Size

Product Diversity

Employee Characteristics

24

Chain of CommandLevels of Management

First-line or sometimes called the front line

Middle

Top

25

Pointers to Assure Effective Delegation of Authority

Be sure delegates are willing to accept authorityBe sure the delegates understand what is expected of themBe sure the delegates are qualifiedEstablish policies to guide decisionsSpecify deadlinesEstablish an evaluation processReward delegates who get things doneAdmit that others can do a task

26

Commonly Encountered Resistance to Delegation

Proper job information not receivedLack proper trainingLack self-confidence & fear failureNot provided proper equipment or toolsNot certain the extent of authority providedNot confidence there is anything to gain by accepting the authorityFind it easier for the manager to make the decisionsNot paid for this responsibility

27

Organizing for Financial Management

For-profitNot-for-profitSole ProprietorshipGeneral PartnershipLimited PartnershipLimited Liability PartnershipLimited Liability CorporationS CorporationC Corporation

28

Common Reasons for Starting a Business …

Be own bossFinancial IndependenceCreative FreedomFully use own skills and knowledge

29

Questions to Answer for Identifying the Niche …

What business am I interested in starting?What services or products will I sell?Is my idea practical?Will my idea fill a need?What is my competition?What is my business’s advantage over existing firms?Can I deliver a better quality service?Can I create a demand for my business?

30

Pre-business Checklist

What skills and experience do I bring to the business?What will be my legal structure?How will my company’s business records be maintained?What equipment or supplies will I needed?How will I compensate myself?What financing will I need?Where will my business be located?What will I name my business?

31

Financial Accountability &Reporting

Existence and OccurrenceCompletenessRights and ObligationsValuation and AllocationPresentation and Disclosure

32

Internal Control

It is a process.It is affected by the people of the organization.It provides reasonable assurance regarding the achievement of objectivesIt is geared to the achievement of the organization’s objectives.

33

Components of a Control Procedure …

Control EnvironmentRisk AssessmentControl ActivitiesInformation and CommunicationMonitoring

34

Key Questions the Financial Manager needs to Answer

What long-term investments should the organization consider?What lines of business will the organization be in?What sorts of facilities, machinery, and equipment will the organization need?Where will the organization secure the long-term financing to pay for investment?Will the organization bring additional investors?Will the organization borrow the funds needed?How will the organization manage everyday financial activities?

35

Financial Reports

Balance sheetStatement of cash flowsCommon-size statementsCommon-size balance sheetsCommon-sized income statements

36

Auditing

Internal auditing or control

External Auditing

37

The Internal Control Process:

Key Objectives

Efficiency and effectiveness of operationsReliability and completeness of financial and management informationCompliance with applicable laws and regulations

38

Internal control consists of …

Management oversight and the control cultureRisk managementControl activitiesInformation and communicationMonitoring activities

39

Characteristics of Performance Information

UnderstandabilityRelevanceReliabilityComparabilityCost beneficial

40

What is financial planning?

It is the foundation upon which an organization can be a successful future.It is much easier for decisions to be made to be made in a proactive manner when a plan is in place.Risks are reduced and the organization’s competitiveness is increased.Financial planning is an integral part of any strategic plan.

41

Financial planning can help provide solutions …

Funding capital projectsDeveloping new products and servicesRetiring products and servicesSelling assetsPurchasing assetsProtecting assetsRelocating an organizationTax liabilities

42

Financial Staff’s Activities

Forecasting and planningMajor investment and financial decisionsCoordination and controlDealing with the financial marketsRisk management

43

Cash Planning

The process of determining the amount of cash needed at a particular point in the budget year by gathering data from both internal and external sources.

44

Cash

Cash is any medium of exchange that a bank will accept at face value.Cash Flow is the difference between the number of dollars that came in and the number that went out.Operating cash flow tells the manager whether cash inflow will meet the daily cash outflow.Cash flow budget records estimates of cash receipts (cash in) and disbursements (cash out) resulting in an estimate of the cash surplus or deficit.

45

Profit

Profit is the sum remaining after all costs, direct and indirect, are deducted from the revenue of an organization.

46

Profit

Profit is the sum remaining after all costs, direct and indirect, are deducted from the revenue of an organization.Revenue is the amount charged to customers for goods or services sold to them. There are alternative terms used to identify revenue including sales, fees earned, rent earned, or fares earned.

47

Common Measures of Profitability

Profit margins on SalesReturn on Total AssetsReturn on Common EquityReturn on Investments

48

Margin

Margin is the difference between the cost and the selling price of goods produced and services rendered.Profit margin is a profitability measure that defines the relationship between sales and net income.

49

Capital Budgeting

Capital budgeting deals with investment decisions involving fixed assets. It is an outline of planned investments in fixed assets. Further, it is a process of analyzing projects and deciding which ones to include in the capital budget.A fixed or permanent asset is one that is long-lived.

50

Budget

The budget is a part of the foundation upon which an organization justifies its mission. It is an estimate of revenue and expenses for a given period of time, usually 1-2 years. Further, the budget is a restatement of the organization’s objectives in financial terms.

51

Common Budget Types

Line itemProgramPerformanceZero-basedEntrepreneurial

52

Budgeting Process

Collecting dataAnalyzing the dataIdentifying the data collectedPreparing the budget documentImplementing the approved budget

53

Sources of Revenue

Membership feesTicket salesAdmissions feesFood concessionsCorporate sponsorshipsLicensing agreementsBeverage concession

Lease agreementsParking concessionMerchandise salesLuxury suitesClub/Premium seatingPremium restaurant agreements

54

Sample Expenditures

SalariesEmployee benefitsInsurance premiumsGuaranteesLease agreementsVehicle rentalsTelephoneElectricityComputer maintenance

Water & SewageNatural gasOffice suppliesPostageDuplicationPrintingAdvertisingTaxesScholarships

55

Purchasing Process

The selection process

Needs assessment

Procurement

56

Purchasing process ensures purchases will …

Meet the program needsProvide qualityBe acquired following proper proceduresBe properly accounted forBe maintained for future safe use

57

Common Components of a Purchasing Program

StandardizeQualityPrompt paymentEarly-bird orderingProfessional and personal relationships with vendorsBusinesslike approach

58

Factors to be considered in developing a needs assessment

Available space & facilitiesDesired activitiesSafety & health of the participantsNumber of participantsCost Length of seasonGeographical locationFitinventory

Staff & supervisionInstructor/coachContinual learningStorageAge of participantsGender of participantsSkill of participantsPhysical & mental abilitiesType of organizationPrioritizing

59

Guidelines for selecting equipment and supplies …

Determine purchasing powerBegin & maintain a wish listDetermine organization needsDetermine quality desiredWithin budgetMaintenance friendlyReputable company

Old or newBased on program goalsDetermine priority needPersons with disabilitiesSafety standardsReview a variety of vendorsConsider guaranteeUsability of equipmentCompanies service record

60

Guidelines for purchasing equipment and supplies …

Purchases meet organization’s requirementsPurchases have management approvalPurchasing should be done in advance of needSpecifications clearLow cost with quality

Reputable business firmCentral purchasing can save dollarsAll request must have purchase requisitionsConsider local firmsObtain competitive bidsAll purchase should be accompanied with a purchase order

61

Purchase order should contain the following …

Name and contact information for person submitting requestName and contact information of the vendorDateAccount numberDepartmentAmount

QuantityUnitDescriptionUnit priceSpecial terms: date for delivery, substitutions, discountRequestor’s signatureSupervisor’s signature

62

Evaluating Equipment before purchase consider …

Safety recordSpecial considerationsDoes product meet program needs?What is the warranty?Who is the manufacturer?

63

The Procurement Process

Need establishedManagement consultationInitial request submittedRequest reviewedFunds availablePreparation of specifications

Receipt of bidsComparison of bidsRecommendation of appropriate bid for purchasePurchase order to supplierFollow-up, receipt of goodsPayment authorized

64

Typical Bid Process

Writing specifications for approved item(s) to be purchasedReceive bidsEvaluate bids to ensure all specifications have been metChoose vendor(s)Submit the purchase orderReceive the equipmentPay invoice after equipment or supplies are verified

65

Writing Specifications 

Incomplete Worth BW8 Powercell Baseball Bat or equivalent(does not specify length requested and allows vendor to make judgment on substitution)

Complete(without substitutions)

Worth BW8 Powercell Baseball Bat, 35” Length, 32 ounce weight, 2 5/8” diameter – No substitutions or alternatives

Complete(with substitutions)

Worth BW8 Powercell Baseball Bat, 35” Length, 32 ounce weight, 2 5/8” diameter OrEaston LK8 Magnum Bat, 35” Length, 32 ounces weight, 2 5/8” diameterOrLouisville Slugger “YB-17” Baseball Bat, 35” Length, 32 ounce weight, 2 5/8” diameter 

66 

To: FlagHouse Physical Education & Recreation 601 FlagHouse Drive Hasbrouck Hts., NJ 07604-3116

Ship/Bill To: Julia Ann Hypes Dept. of Health, Physical Education and Sport Sciences Morehead State University 201 Laughlin Health Building Morehead, KY 40351

 

 Purchase Order Number 014325 Account Number 10-15320-201 Date June 4, 2003 

QUANTITY ITEM UNITS DESCRIPTION UNITPRICE

TOTAL

5 G11655 Ea. Wilson Impact Rubber Basketball Size 7

14.00 70.00

10 G5786 Ea. Rawlings “RWW” Leather Basketball Size 6

56.00 560.00

3 G5976 Pr. Thera-Brand Dumbbell Roller

20.00 60.00

10 G11970 Doz. Spalding Top Flight Series X-Out Golf Balls

10.00 100.00

            Subtotal 790.00Shipping $40.00

Balance Due $830.00

67

Public Revenue Streams

Tax abatementGrantsHard Taxes

Local income tax Real estate Personal property General sales

Soft Taxes Car rental Hotel-motel player

Restaurant Sin

Cigarettes Alcohol Gambling Prostitution

Taxi

68

Private Funding Sources

Cash donationsIn-kind contributionsNaming rightsConcessionaire exclusivity agreementsFood serving rightsBeverage serving rightsPremium restaurant rightsSponsorship packages

Life insurance packagesLease agreementsLuxury suitesPremium seatingPersonal seat licensesParking feesAdvertising rightsVendor/contractor equityBequests and trustsReal estate gifts

69

10 Common Types of Broadcast Media

•ABC, CBS, NBC, FOX, Westinghouse Broadcasting, and Public Broadcasting Service, •Ultra High Frequency (UHF) Channels, •Superstations (namely, WGN in Chicago, and WTBS in Atlanta), •Cable Channels (i.e., TNT in Atlanta, and USA Network in New York City),•Sports Channels (i.e., Entertainment and Sports Programming Network [ESPN], Sportsvision and Sports Channels in Chicago, St. Louis, Ohio, and Orlando, Prime Network in Houston, Prism in Philadelphia, and Sunshine Network in Orlando, •Independent Producers, •Local TV Stations (local Very High Frequency [VHF]), •Cable Franchises, •Pay-For-View, and •Local AM and FM Radio.

70

Essentials in Financial Planning

The mission, goals, and objectives for the overall planAn analysis of the organization’s current financial situationAn analysis of revenue projections versus expense projectionsAn analysis of capital projections throughout the financial period of the planSpecific information regarding the intended financial state at the end of the time period

71

Mechanisms for Financing Debt

Bonds Full-faith and credit obligations Non-guaranteed

Revenue bonds Tax increment bonds Certificates of participation

Taxable bonds Asset-backed securitizations

Special bonding authorities

72

Luxury Seats in Sport FacilitiesLeague # suites 2001 # Teams Annual Lease PriceMLB 2,286 30 $ 85,000NBA 2,533 29 $113,000NFL 4,294 31 $100,000NHL 2,813 30 $ 77,000Total 11,926 120 $ 93,750 average priceSource: Modified from Howard and Crompton, 2004, 265, 266. Note: NBA/NHL Shared Arena annual lease price = $199,000.

73

Sampling of the Number of Club Seats at Various Venues and the prices charged by Teams for their Occupancy Team Facility Number of Price Range/year

Club SeatsLakers (NBA) Staples Ctr 4,500 $12,995 to 14,995/seasonTrailBlazers (NBA) Rose Garden 2,500 $7,500 to 11,500/seasonNuggets (NBA) Pepsi Ctr 1,854 $65 to 100/gameKnicks (NBA) Madison Square 3,000 $175 to 1,350/gameCoyotes (NHL) American West 1,651 $72/game;$3,250/seasonBengals (NFL) Paul Brown 7,700 $995 to 1,900/seasonBucs (NFL) Raymond James 12,000 $950 to 2,500/seasonRavens (NFL) PSINet 3,196 $108 to 298/gameIndians (MLB) Jacobs Field 2,064 $32/game; $1,905/seasonRockies (MLB) Coors Field 4,400 $30 to 32/gameRangers (MLB) Arlington 5,700 $2,00 to 3,000/seasonSource: Modified from Howard and Crompton, 2004, 270

74

PSLs Average Cost by LeagueLeague Average Price RangeMLB $3,615 –14,600NBA $ 900 - 5,000NFL $ 600 – 3,350NHL $ 750 - 4,000

75

Groups Benefiting from a Sponsorship

The business interest of the sponsoring corporationThe business interests of the event and participantsSponsor’s direct customersCustomer who buys the product or entertainment

76

Element in Developing a Sponsorship Philosophy

The exchange processPhilanthropyAdvertising cost and valueReturn on investmentMarket reaserch

77

Sponsorship Objectives

Achieving sales objectivesGenerating media benefitsSecuring entitlementSecuring naming rightsIncreasing public awareness of the company, the product, or both

Altering/reinforcing public perception of the companyIdentifying company with a market segmentInvolving company in the communityBuilding good will among decision makersCreating an advantage over competitorsGaining unique opportunities in terms of hospitality and entertainment

78

Examples of Athletic Platform

The teamThe sportThe eventThe athleteProfessional athleticsCollegiate athleticsInterscholastic athleticsRecreational athletics

79

Components of a Sponsorship Proposal or

Agreement

Objectives of the sponsorshipProfile and background of sponsoreePromotional opportunities availableLevels of sponsorshipSponsor benefitsFee structurePayment scheduleContract lengthContract renewal optionsEvaluation methodology

80

Questions for the planner to ask before drafting

proposal

How would you describe the organization?What is the event to be sponsored?What impact do you have on the local community?What is the purpose of your event?How will the organization involve the community?Will the event allow sponsors to reach their consumers?Is the event based on a similar successful event?Why is the event unique?

81

Levels of Sponsorship

Exclusive sponsorshipPrimary sponsorshipSubsidiary sponsorshipOfficial supplier

82

Customizing the Package

Official statusSponsorship feeTitle rightsTelevision exposurePublic relations and media exposureLogo usesignage

Advertising rightsHospitality rightsPoint-of-sale promotionsDirect-mail listsProduct samplingLegal liabilitiesFuture options

83

Sponsor Benefits

Season ticketsAdvertisement in yearbook, program, or media guideScoreboard/PA exposureSpecial event nightsArena signageSpecial items (VIP room, luxury suite, club seats, parking passes)

84

Sponsorship Pricing

Cost-plus

Competitive market

Relative-value

85

Review the following before establishing a price

…

Degree of primary consumer match with company’s target marketSize of the primary consumer basePotential media publicitySales opportunity, psychological associationExposure opportunity

86

Why Licensing?

Consumer demand for logoed apparel has provided sport programs to financially benefit through licensing. In addition to financial gains, exposure for the program is created through the availability of logoed products in the marketplace.

87

Trademark Classifications

Class 6 – metal goodsClass 16 – paper goods and printed materialsClass 18 – leather goodsClass 21 – housewares and glassClass 24 – fabrics (pennants and banners)Class 25 - clothing

Class 26 – fancy goods (patches for clothing buttons)Class 28 – toys and sporting goodsClass 41 – education and entertainment servicesTM = Trademark notification® = Federally registered mark© = Copyright notification

88

In-house or Outsourced

Scope of the licensing programPotential for the sale of the productBudgetAvailability of specialized expertise

89

Licensing Agreement Components

Parties involvedDescriptive marksDetails of marksExclusive or non-exclusiveProduct sample includedCompliance review schedule

RoyaltyRoyalty auditsRoyalty exemptionsPayment scheduleInternational distributionContract lengthContract renewal options

90

Typical Financial Arrangements with a

Franchise

The franchisor allowing the franchisee to see its name or brandThe franchisor exercising continuing control over the franchiseeThe franchisor providing assistance to the franchiseeThe franchisee making periodical payments to the franchisor

91

Questions to ask before buying a franchise …

Are you willing and able to take on the responsibilities of managing your own business?Will you enjoy the franchise?Are you willing to completely follow the franchise system?Do you have a history of success in dealing and interacting with people?

92

Questions continued

Can you afford the franchise?Have you carefully studied the legal documents?Does the franchise you are considering have a track record of success?Are the franchisees generally happy and successful?Do you like the franchise’s staff whom you will be working with?

93

Financing a Sport Franchise

Public sources Government bonds Tax dollars

Sales Hotel-motel Utility Car rental Taxi Liquor, cigarettes,

gambling Road Capital improvement

Private sources Food serving rights Beverage serving rights Premier restaurant

rights Luxury suites Club seats Parking rights Merchandise sales Sponsorship contracts Licensing agreements Land & money gifts

94

Product of a Box Office

Seating plansTicket systemTicketing softwareOutsourcing ticketingOnline ticketingPricing structureCredit card service

Group salesDiscounted pricesAdvanced salesSales incentive plansTickets General admission Reserved

95

Types of Tickets

General admissionReservedSeason ticketMini-season plansIndividual eventComplimentaryPressStudentRain check

96

Typical Seating

Seating configurationDiscounting ticket pricesOn sale dateGroup salesTickets to be heldUsher seatsObstructed seatsHouse seatsObstructed view seatsWhen to release house seats

Seats required for performersVIP seatsPress passesComplimentary ticketsLatecomer seatsWaiting line policyComplimentary tickets unclaimedUnpaid reservations unclaimedStanding room

97

Retail Operations

Sporting events Beverage Fast food Parking Premium Restaurants Merchandise sales

Non-sporting events Rentals Downhill ski facilities&

services

Equestrian services Golf facilities &

services Marina services Shuttle bus service Theater productions Movie theaters Vending machine

services Aquatics facilities &

services Hotel/motel services

98

Major Concessionaires

AramarkCompassFine Hosts CorporationGlobal SpectrumSodexhoSportservice CorporationVolume Services Ameria

99

Food Concession Guidelines

Employee appearanceTraining goalsMaintenance goalsOperation goalsRegulationsInspectionsPatron comforts

Safety certificationSanitationGuest relationsProfessional signs & pricingDecorations Food handlers guidelines

100

Effective Alcohol Sales

Develop an alcohol management planDevelop procedures to stop outside alcohol from entering venueEstablish crowd control procedures for alcohol managementInstall signage to enlighten patrons about responsible drinkingEstablish a strong ejection policyDo not promote or advertise drinking during the event

101

Continued Sales Strategy

Make sure security personnel are aware of crowd demographicsAll staff should complete alcohol management schoolEstablish consumption policiesTailgating only permitted in parking lots under strict supervision of security personnelEstablish non-alcohol sections within the venueDevelop a designated-driver program

102

Strategies for a successfulParking Concession

Purchase adequate liability insuranceProvide adequate surfacing for the proposed trafficEnsure safe entrance and exit areasProvide adequate lightingPlan for immediate snow and ice removal

Establish an emergency plan for the spaceEnsure that adequate supervision and security is availableProvide for the safety of the pedestriansPlan a graphic systemProvide an adequate number of cashiers and attendants

103

Parking Controls

Sensors or loops buried in each entrance lineA single pass laneA cashier or checker watching the sellers and authorizing passesSpot checks on sellers

Different colored tickets for different events, days, or hoursCash registers,TV monitorsClean graphics and signs indicating special entrances

104

Questions for Finding a Retail Niche

How is my store special and unique?What groups of people would most benefit by what I offer?How have I physically set up my store to be user-friendly in a concerted effort to serve this group of people?Is my advertising targeted to the customers I desire to serve?What products do I like?

105

Steps to Becoming a Good Buyer

Be specific in defining needsUnderstand the optionsTell the supplierAim for a win-win situationImpose deadlines and conditions

Seek assistanceEducate the seller about your special needsLook for after-sale serviceYell for help when necessary

106

Four Ms in Retail

Merchandising

Markups

Marketing

Methodology

107

Keys to Effective Store Layout

Maximizing the space

Controlling & directing traffic flow

Maximizing exposure

108

Common Mistakes Made by Retailers

No business planNo marketing planNo sales planNo advisory planNo cash reserve or real cash flow

Ignoring the numbersNot being automatedNot knowing your customerIgnoring employeesBeing a lone ranger

109

Minimizing the Damage

Lock it upPlay traffic copWatch who cleans after the employee store closesEncourage employeesKeep an eye on the future

110

Successful Retail Stores Accomplish the following

Found in prominent locationsOffer personalized serviceOffer competitive pricingPrint catalogues for employeesMerchandise their goods/products

Consider themselves retail outletsSell innovative goods/productsConcentrate on apparel and accessoriesStock regularly needed suppliesSell licensed merchandise

111

Critical Areas for Customers

Identify the customersDifferentiate the customers from one anotherInteract with the customersCustomize items for the customers

112

Identifying Customers

Use drip irrigationVerify & update customer dataTake inventory of all customer dataLocate customer-identifying information

Devise strategies for collecting more dataVerify information at least every two years

113

Customer Date Gathered

NameMailing addressBusiness phoneHome phoneFax numberE-mail Position & titleAccount numberFrequencies of purchasesBilling & invoice recordsWarranty recordsCoupon redemption

Credit card numberBirthdaysAnniversariesSpouses or significant other’s nameChildren’s namesBuying historyPreferencesSales force recordsRepair & service recordsLoyalty user-cardCustomer commentsList swaps

114

Customer Task List

Determine first how many customers are knownDevise programs to increase the number of customers knownEstablish a common format for identifying customersDetermine how to link customer with purchasesMake it easy to capture customer data

Allow customers to enter & update informationDevelop a system to ensure the contact information is currentTrack all referred to and referred by parameters for all prospects & customersConsider programs to increase referrals by current customers

115

Ranking Customers

Prioritize efforts & gain most advantage with most valuable customersTailor behavior toward each customers needsDevelop a customer profitability and valuation modelCategorize customers by their differing needs

116

How-to Interact with Customers

Direct sales callsE-mail and electronic data interchangeFax messagesMailPoint-of-purchaseTelephoneWebsite

117

Why Sport Teams Lose Fans

Not importantCost outweighs enjoymentDirty facilitiesBoring food servicePoor seatingInconvenient parkingNo luxury seatingNo picnic areas

No non-smoking areasNo non-drinking areasNo place to change the young childrenSouvenirs too expensiveNo other entertainment but the game itselfTeam is not excitingTeam fails to win consistentlyNo opportunities to meet the players

118

Increasing the Audience

Pre-event entertainmentYouth games at half-timeSpecial group promotionsSpecial rates for groupsGiveawaysScheduling doubleheadersUse of pep band at eventsFace-painting contestTeam color night

Reduced ticket feesShoot-out contests at half-timeEvent busesSpecial daysStudent athletes visiting schools as role modelsClip-out couponsRadio giveaways to listeners

119

Customer Needs over the Internet

Security

Support

Information

privacy

120

What Sets Customers Off

Long delaysService or sales problemsUncaring or sloppy attitudeWasted timeFailure to listenFeeling that you are a number and not an important customer

Failure to follow customer’s instructionsBroken promisesFinancial losses = poor serviceInability to provide needed answersImpolite salespersons

121

Outsourcing

Outsourcing is where a third-party service provider hosts a family of integrated applications and infrastructure services.A key element of outsourcing revolves around the transfer of control over the outsourced process.

122

Why outsource?

Reduction in operating costsIncrease in controlling operation costsChanging management focus to core business functionsAccessing world class expertise and capabilitiesRedirecting resources toward activities which have a greater return on investmentImprove production and eliminate backlogsAccessing information and professional solutions to non-business core functions

123

What could be outsourced?

Accounting and bookkeeping servicesFinancial servicesPension record keeping servicesAuditing and taxation servicesData entry and processing

E-mail systemSoftware developmentWebsiteHead huntingConcessionsSafety and securityRisk managementParking

124

Advantages of Outsourcing

Volume purchasingConcessionaire can return more revenue to the facilityCapital outlays for equipment avoidedManagement, staff, purchasing, maintenance, inventory, storage, and vendor relations are eliminatedThe vendor takes the financial risks

125

Disadvantages of Outsourcing

Losing some or all control of the operationVendor failing to recognize needsCustomer dissatisfied with merchandise or services offeredScheduling part-time employeesPurchasing perishable foodstuffs or imported souvenirsDetermining what stands are open on a given dayDeciding whether or not the sanitation policies are enforcedDetermining who is stealing money, food, or merchandise

126

Advantages of In-House Operations

Management has complete controlManagement controls pricingThe quality of product or service is controlledThere is greater potential for generating revenue

127

Components for Concessionaire Agreement

Date submittedName, address, phone, fax, and e-mailPrincipal contactHistorical background of companyFull description of business philosophyFull description of financial objectives

CommissionEquipment to be providedInsurance coverageFull description of personnel training programAdvertising and promotional efforts

128

Contract Components

Type of merchandise or service to be providedLicense to products or provide a serviceWhere products are producedOption to renew contractTermination clauseCommission clauseInsuranceIndemnificationRight to remove merchandiseMaintenance clause

Establish company-vendor committeeStore or service hoursSecurityVending machine contractMonthly management meetingExclusions from the contractDefinition of gross versus netAudit controlsBuyout provisions

129

Typical Concession Contracts

Commission

Management Fee

130

Fund Raising

Fund raising is the art of soliciting money for charitable organizations, schools, college/universities, political parties, as well as other worthy organizations and projects.

131

Fundraising is …

Anything that increases revenue streams including, but not limited to:

Deferred giving Donations Grants Merchandising Licensing Promotions Naming events Sponsorships Special events

132

Case Statement

A case statement is a clear, concise, and compelling explanation why the organization merits the support of its members and others.It explains the rationale and objectives of the fund raising program.It is the basis for proposals, which will be submitted to corporations, foundations, and individuals.

133

Steps for Gathering Information for the Critical

Review

Develop a questionnaire to interview the various stakeholdersDevelop a list of stakeholdersCritique the mission and beliefs statements and compare to other like organizationsExamine the goals and objectives of the organization and other similar organizationsSurvey other case statements from similar organizations and communities

134

Key Ingredients in the Case Statement

Description of the compelling needDescription why the organization is uniquely suited to implement the projectThe purpose and mission of the organization which enables it to implement successfully this projectHow and why the organization was startedWhat is the organization doing today in this area that would further support this projectWhere will the organization be five years from now.

135

Basic Elements of a Fund Raising Program

Management structureVolunteer requirements establishedVolunteer recruitmentIdentification of giving opportunities

Overall goal and goals by sourceCultivation and solicitation strategiesPublic relationsProspects at the end of the funneltimetable

136

Guidelines for Fund Raising Plan

Must be program specificMust establish a prospect listAccounting system must be establishedDevise an acknowledgement & follow-up systemEstablish a timetableMust have not-for-profit tax status

Establish a board of directorsShort- and long-term plan developedPrioritized goalsSimple organizational structureInvolve an attorney and CPAChoose cost-effective projectsTrain staff & volunteers

137

Fund Raising Issues

Definable financial needCan fund raising meet needsIs this the best whyProject worthy of supportAdequate and competent leadershipCross-section of volunteers

Support organization in existencePositive reputationCost of raising dollarsDownside risksTime and resource requirementsLegal issuesFinancial & political climate conducive to success

138

Components of a Fund Raising Program

WhatWhereWhyWhenBy whomCategories or vehicles for givingFeasibility

139

Common Models of Fund Raising

Contributor campaignsGrant seekingMajor/planned giving programsProduct salesMembership campaignsSpecial eventsCapital campaigns

Person-to-person solicitationSingle-person cultivationTelemarketingDirect mail solicitationContests of chanceAnnual campaignsMemorial requests

140

Benefits to Contributors

Preferred parkingComplimentary ticketsReduced ticket pricesSpecial seatingVIP lounge membership cardPress guideOther publicationsMention and recognition in game programsTravel with teamSpecial apparelA private booth for home contestsNamed scholarship

Free golfFree or reduce membership to health and wellness centerSpecial event ticket priorityDinner & banquet seating priorityPlaquesInvitations to special eventsPeriodic newsletterAuto decalAway game ticket priorityAccess to press boxNamed scholarshipNamed room

141

Common Types of Major Gifts

BequestsTrustsLife incomeLife insuranceOutright gift

142

Role of Staff/Board for Grants

Board Members Set annual goals Identifies grantmakers Cultivates grantors Influence to gain

access/appointments Asks for gift

Staff Develops & administers

plan Conducts research on

grantmakers Organizes cultivation

process Writes proposal Provides information for

visits Accompanies board

member and provides information regarding visit

143

Role of Board/Staff for Major Gifts

Board member Sets annual goal Identifies prospects Cultivates prospect Uses influence to gain

access Asks for gift

Staff Develops & administers

plan Conducts research on

grantmakers Organizes cultivation

process Writes proposal Provides information for

visits Accompanies board

member and provides information regarding visit

144

Role of Board/Staff for Special Events

Board member Set annual goal Serves on event

committees Recruits & solicits

sponsorships Attends event &

recruits attendees/sells tickets

Staff Develops &

Administers plan Provides staff support

to event committee Provides research on

sponsorship prospects Provides staff support

during the event

145

Role of Booster Club Board

Help develop fund raising planEnsure the case statement is strongHelp develop strategies for cultivationEvaluate expectation of giving from boardSolicit gifts at various levelsInvolve other board members

146

How Board Members Participate

Make a personal contributionUnderstand the fund raising planUnderstand and endorse the caseRaise money from outside sources

Identify prospects Cultivate prospects Ask for gifts

147

Why Committees?

Provides for representationProvides for valuable inputEstablishes policy and proceduresIncreases communicationAllows employee involvement in decision making

148

Advantages of Committees

UnificationRepresentationMotivationCoordinationConsolidationcommunication

149

Disadvantages of Committees

Increased costsExtra time needed to complete taskCompromise decisionsLeadership strugglesUnbalanced representation

150

Types of Committees

Standing committees Nomination Awards Finance Human Resource Audit Constitution or by laws

Special committees or ad hoc

Administrative Project committees

151

Structure of a Committee Meeting

Call to orderRoll callMinutes of previous meetingState the purpose of the meetingState briefly the program (agenda) for the meetingDiscuss and resolve agenda itemsNew businessAdjourn meeting

152

Sample Agenda

Call to orderWelcome and introductionsRoll call or attendanceApproval of the agendaReview and acceptance of minutes from last meetingTreasurers reportOther reports

Action items and discussionDiscussion itemsOld businessNew businessAdjournment

153

Chairperson’s Duties

Planning the meeting and establishing the agendaConducting the meetingMaintaining records and informationGetting action on items on the agendaEvaluation of committees

154

Secretary’s Duties

Take minutesTake attendancePrepare minutes for approvalMaintain a file for the minutesCollect committee reportsCollect staff reports

155

Treasurer’s Duties

Prepare monthly financial reportsSign checks (i.e., payroll, expenses, etc.)Invest surplus dollarsMaintain checks and balancesPrepare a financial report to the board monthly

156

Components of an Orientation Program

Emphasize the importance of being a committee memberExplain duties of members and officersReview committee’s authorityReview committee’s chargeReview organization’s policies, practices, and proceduresReview constitution and by-lawsProvide a list of all members and contact informationReview previous minutes

Review committee’s projectsReview schedule of meetings, locations, dates, and timesReview all current assignments of individual committee membersReview previous membershipCriteria for selecting new membersIdentify staff and their rolesReview short- and long-range strategic plan

157

Components of a Grant Workbook

Developing & evaluating proposal ideas, how-toProposal listRedefining proposal ideas to find more funding sourcesExpanded and redefined proposal listNeeds assessmentDocumenting needPrivate funding source research toolsHow to contact private funding source

UniquenessCase statementAdvocates, how to use theAdvocate listAdvisory committees, how to develop community supportAdvisory committee listGovernment funding sourcesList government funding programs with deadlinesSample letters of proposal

158

Brainstorming Technique

Appoint a neutral group leader or employ an outside facilitatorAppoint a recorderSet a time limit – 10 minutesState one question or problemAs each group to generate answers to the problem

Encourage group members to piggyback on each other’s answersRecord and post all answers, combining those that are similar.

159

Reviewing Project from Different Perspectives

Subject areas

Constituencies group

Type of grant

Project location

160

Needs Assessment Approaches

Key informantCase studiesCommunity forumSocial indicatorssurvey

161

Typical Proposal Sequence

Cover letterTitle pageExecutive summaryIntroductionProblem/needGoals and objectives

MethodsAssessment or evaluation of the projectFuture fundingDisseminationBudgetattachments

162

Common Writing Tips

Follow the guidelines exactlyFill in all the blanksDouble check all computationsRepeat anything they ask forYour writing style must reflect what the funding source wantsBegin each section with a strong motivating lead sentenceVocabulary – shorter words are generally better than long, complex wordsStyle –easily skimmableUse short sentences

Use an active voice and describe emotions and feelingsUse humorAsk the funding source a question and answer itUse contractionsUse short paragraphs – five to seven linesVisual attractiveness – use underlining, bullets, bold headings, pictures, charts and graphs

163

Trends Affecting Not-for-Profits

Leadership’s roleValue-return on investmentResponsivenessTechnology useChange loopsRevenue sourcesGenerational issues

WorkforceOutsourcing &co-souringGovernanceCompetition & alliancesConsolidation & mergersGlobalizationImage building

164

What is a Booster Club?

A booster club is a not-for-profit entity organized to raise funds for a sport or other organization.It is generally an organization operated by volunteers and, in some cases, a few paid staff.

165

Typical Components of a Constitution or by laws

Officers terms

Board Terms Criteria for

membership

Committees Standing Ad Hoc

Board meetingsMembership categoriesPurposeDissolution

166

Typical Officers

President

Vice president

Secretary

Treasurer

167

Volunteer Characteristics

25% rule20% ruleVolunteers have feelingsVolunteers have needsVolunteers have specific interestsVolunteers have specific competenciesVolunteers are individuals

Volunteers are not professionalsVolunteers are not paid staffVolunteers desire to be of assistanceVolunteers have the potential to be excellent recruitersVolunteers can be educated to assume a variety of rolesVolunteers are able to grow in professional competency

168

Recruiting Methods for Volunteers

Making the event or activity funFinding out what the volunteer(s) respond toInvolving the volunteer and familyMaking it easy, attractive, and interesting to volunteerMaking the volunteer responsible for something

Treating the volunteer with respectAsking for referralsPlanning social events for the volunteersPaying for a volunteer’s trainingPlacing volunteers’ photographs on bulletin boards

169

Before Recruiting Begins

Train recruitersDevelop job descriptionsIdentify potential volunteersMatch people with jobsObtain approvals

Annual plansEstablish recruiting techniques

Grow your own volunteers Appointment from within Referrals Friendship groups Family involvement Benefit packages Peripheral groups Use of media to

communicate volunteer opportunities

170

Retaining Volunteers

by making The event or activity

attractive to belong Certain the event is

well organized People feel needed

and appreciated Sure there is a

friendly atmosphere A special effort to call

volunteers

Certain the volunteer understands duties

Sure to get volunteers input

A special effort to recognize or reward volunteers

The event or activity fun

Certain that everyone receives an appropriate thank you

171

Volunteer Orientation Models

Large group sessions

Small group sessions

Personal, one-on-one orientation sessions

Personal, one-on-one mentoring

172

Orientation Agenda

Philosophical & conceptual framework of the organizationContent of the various organization’s programsGovernance of the organizationOrganization of the various organization’s programsHistory of the organizationPolicies & procedures of the organization

Bylaws and the proper conduct of businessEthics issuesBenefits of volunteering and special privilegesIdentification of key people in the organizationTelephone numbers of key peopleRealistic job previews

173

Elements of Supervision

Establishing criteria of success, standards of performance, and programs objectives such as the job description and annual plan of workMeasuring actual volunteer performance with respect to these stated criteria of success through observation, conferences, and evaluationMaking corrections, as needed, through managerial action.

174

Common Solutions to Conflict Management

Retraining

Reassignment

Redesign

Dismissal

175

Factors causing Conflict

Lack of agreement about program goalsIll-defined & unmeasurable objectivesAbsence of a preconceived planExcluded from the planning processInaccessibility of leadersDistortion of information accidentally or deliberatelyLack of trust

Hidden agendasIneffective listeningA belief in absolutesA belief that only two sides of an issue exist and that one must be right and the other wrongIndividual differencesMisunderstandings about territory, policy, authority, and role expectations

176

Common Types of Awards

Group recognitionIndividual RecognitionInformal recognitionPublic & media recognitionFormal recognition

177

Possible Areas of Liability

BuildingsMotor vehiclesProgram activitiesEmployee conductBusiness general liabilityPerformance guaranteesFinancial securityFringes for employees as prescribed by law

178

Insurance Coverages Available

Professional teams, athletes and eventsAmateur athletes and eventsCollege and high teams and athletesAthletic associationsAccident and injury coverageSport venuesPromotions & special eventsGeneral public liabilityLiability coverage protecting employees, directors, and officers

Sports campsTransportation insuranceCatastrophic injuryDisabilityYouth & adult teams and leaguesHealth, fitness, sport clubsVehicle insuranceProtection of finances and operations

179

Components of a Comprehensive Insurance

Program

Should include , but not limited to: Property

Fire, flood, hurricane, tornado, and/or earthquake Business income Commercial liability Machinery and equipment Employment practice liability Special liability Bonding Crime insurance Employee benefits

180

Basic Liability Areas Insurance Companies Review to Determine

Insurability

SecurityMaintenanceHousekeepingEmergency servicesParking and traffic controlConcessions Chemical usage & storage

Staff training & preparednessFiscal operationsStaff supervisionActivity planningEquipment used in building & grounds maintenance and sport equipment

181

Checklist for Securing Insurance

- Never assume you are covered;- Always check your insurance coverage;- Check insurance policy at least twice a year for changes and to be sure you still have adequate coverage;- File a report on an incident as soon as it happens and submit a proper claim to the insurance company;- Anyone involved in an activity outside their job jurisdiction or areas of control may seek tosecure more personal liability coverage;- Be aware of potential hazards and report them to the necessary people or group;- Secure a short-term group accident policy to cover special activities when risk is forseeable;- Analyze the liability aspects of your program or area and ensure adequatecoverage in these areas;- Have release forms; they may solve small liability problems because the participantsacknowledge the risk they are assuming and their voluntary participation in the program, but donot rely on them to solve any negligent actions and have participants in events obtain medicals.

182

Considerations Before Selecting Deductible

Access student-athlete’s or patron’s primary insurance firstSelect a higher deductibleReview physical activity involved and gender, lower for contact activities and lower for non-contact activitiesCoordinate all medical care through HMO or a special arrangement with local hospitalConsider placing a physician on a stipendEstablish a referral policy to maximize in-house medical services

183

Selecting Appropriate Insurance Program

Select a competent independent insurance consultantKnow insurance vendors and the various types of products availableSecure a number of quotesSeek adequate coverageIdentify risksInsure the correct risksAlways reduce insurance costs by establishing a risk management plan and preventing or reducing risksUnderstand the basic policy and exclusions

184

Elements in Effective Financial Governance

Defining the roles & responsibilities of the board of directors & senior management in the risk management processDeveloping appropriate checks and balances for effective oversight & control of risk developmentEstablishing policy & control guidelinesDesigning risk measurement & reporting procedures

185

Checklist for risk management

Is there a risk management policy?Does the policy clearly define the underlying business rationale?Is the hedge orientation towards a “market view” or a defined strategy?Does the policy include approval levels?Is there an oversight function?

Is there a clear reporting to senior management about business risks?Do proper expertise & systems reside in-house to identify & identify risk?Is there risk management expertise within the organization?Are management reports reviewed by senior management?Does the Board periodically review performance?

186

Sport Entity Risk Management Concerns

Property loss Stationary, mobile, & leased

Employee safety & health Accident prevention Industrial hygiene

Personnel Workers compensation Pension plans Key personnel loss Contractual employees Insurance

Life, disability, & health

Liability control General, vehicle, & product

Environmental protection Storage, pollution control, &

waste disposal

Emergency planning Crowd control, fire,

bombing, & spectator health emergencies

Financial risk Interest rate risk Credit risk Currency risk Liquidity risk Theft of product Theft or money Market risk

187

Property Insurance Checklist

Identify & value buildings, equipment, and landIdentify & value property leased from othersIdentify & value property leased to othersIdentify location & value of stationary inventory (average cost)Identify and value inventory being transported (average cost)

Identify & value property under constructionIdentify & value owned or leased vehiclesIdentify special perils to which property is exposed

188

Liability Loss Sources

Bodily or personal injury to employee, customers, or guestsProperty damage to real or personal property of othersIntentional injury to people or their reputations, including illegal accusations or restraint of alleged shopliftersWrongful hiring, sexual harassment, or invasion of privacy or employees or job applicantsVicarious liability

189

Potential Methods for Dealing with Potential Losses

Risk avoidanceRisk assumptionRisk transfer through insuranceRisk transfer other than insuranceSelf-insuranceLoss preventionLoss reduction

190

Assuming risk =

Loss costs are small and will be funded by current cash flowLoss exposure are retained and funded with a cash reserveLoss exposures are retained & recognized in an unfunded reserve accountA self-insured plan is in operation

191

Common Loss Reduction Activities

Automatic fire sprinkler systemFire walls and doorsTraining replacement personnelRegular training of all personnel

Evacuation plansCrowd control plansDisaster plansSecurity plans