York Urbanist

SHOW ME THE MONEY

Johnny Sweeper got elected to the Board of Directors for his curling club which owns its facility.  He ascended to the position because of his prowess on the curling ice sheet.  But, he gets so caught up in his love of the sport that he misunderstood that the board actually runs a business.

Let me redirect your attention to the resources of your facility. There are four main areas of the facility that typically generate revenues…and they are not all equally profitable.  Reader warning: the numbers may mesmerize you.

On ice –

Kelowna curling sheetsCharge what it is worth.  If your plant is worth $400,000, then amortize the cost over the length of time of use per season over its life of 25 years.  An average six sheet facility uses their ice 40 hours per week during a 27 week season. That is 27000 hours of use. The plant is therefore $15.00 of your hourly cost.  Utilities cost $1.50 per hour. For repairs and maintenance add $2.00.  Your ice maker will cost 1.5 times his/her hourly rate, say $30.00. Your costs for the ice are $48.50 per hour. Your markup should allow you to invest in the future of the facility. $60-$100.00 is the current range in Ontario.  $80 is the minimum you should be charging. The ice is the least profitable floor space in your control.

Therefore, create a reason for people to spend in the lounge.  Assuming that your leagues occupy prime times, offer Special Events on weekends and off-prime hours. Opportunity knocks during slow periods. Typically, clubs have open ice times on Saturdays and Sundays. Perhaps you can juggle leagues so that a new full prime time evening event can take place

Consider:

Hosting an All-star event – Invite four teams of elite players: single elimination, two draws.  Create revenue from spectator entry fees, open bar, and special menus. Costs include fees or prizes to all-stars, icemakers, electricity/power, set-up charges, rentals, special food / liquor purchases. The benefit: variety in your facility and empowerment of the social nature of the sport.

Hosting one or two day Bonspiel every weekend: seniors; juniors; open; men’s; women’s; mixed; starting players; wheelchair; stick; intercity challenges. Even if undersubscribed, you will benefit from higher utilization of your largest asset, the ice.

Upgrading your customers: Learn-to-Curl programs; advanced lessons. Moving your clients up through the club gives them a sense of accomplishment and motivates them to do more. They may even celebrate at the bar – more revenue.

 

In the kitchen –

kitchen Windsor CCThe cost per square foot of floor space is greatest here – $300-$500 per square foot (sf).  If you are in the throes of planning a new facility or renovation, determine how you will use the kitchen space.  You have three options: Hire a caterer, who only needs counters, fridge, heating and washing facilities (a servery will cost $300 per sf; hire a chef in a full commercial kitchen ($500 per sf); or, use your volunteer resources in a limited commercial kitchen (cost somewhere between).

Hire a caterer

Who takes the risk? You have to work out the arrangements. A caterer pays a set fee for the privilege of captive audience.  Do you guarantee numbers, or do the caterers take a chance? When is the best time for them to attend?  Can caterers offer light meals for those times prior to early evening games, or lunches for seniors? Your costs: power for lights and cooking; security; insurance; liability.  For a volunteer board, this is the revenue effective alternative.

Or Hire a chef

This will take you into the labour cost area of your financial statements. First determine if you can hire a chef for 27 weeks of the year. Will you maintain consistency with part time staffing?  With chefs, you get what you pay for. A great chef will bring your patrons back regularly. This can lead to an innovative profit centre that effectively changes your club’s service delivery.

Or volunteer in the kitchen

Have you a dedicated volunteer resource?  This variable changes between urban and rural venues. Rural club members tend to provide more time. The upside is no labour costs and familiar faces behind the counter. The downside is inconsistency in product delivery. This model is effective if your volunteers have pre-determined tasks and times. You have got to watch for volunteer burn out.

Determine what business you are in: a restaurant with a curling facility; or a curling facility with food.  Then decide on the best layout for the kitchen or servery and how best to staff that floor space.

At the bar -

IMG_6578Interestingly, this is the smallest floor space in your facility, yet it can be your greatest profit centre.  You submit unsurprisingly that “you have drinkers with a curling habit”. Yet many financial statements yield little net revenue from the bar! Rule of Thumb: your bar revenues should exceed your product costs by 2.5 times.

The space around the bar should be furnished with stools, valuable for the seats that occupy them. A friendly bar tender can be worth much income to a club. Patrons to the bar may variably be visitors looking for a chat, weary curlers, and spectators or meeting attendees taking a break. Consider having a fourth end break for a drink during social leagues.  There will be more takers (money) than at the end of a game. And make the television (with closed circuit, or Netflix, or sports channels) viewable from the bar.

 

In the Lounge-Meeting space -

Where do you license floor space? The costs of lounge licenses vary between $200 and $1000 in different provinces and states. Through special occasion licenses, you can increase the floor space.  Who are the users?: prime time is for curlers; non-prime time can include meetings and weddings/celebratory events. Lounges have distinct use areas: table spaces; areas around the bar (see above) and viewing space near the glass.  All three spaces can be in use, all the time.

Table Meeting space in some municipalities is difficult to source.  Some corporations or community groups are looking for space on regular monthly time slots or on an ad hoc basis.  Advertise the availability and size of your floor space. If your floor space is dividable, you may also be able to rent space even during curling ice usage by installing portable partitions. Rental space for meetings is typically available for $25 to $50 per hour. Check your municipality for current costs.

Viewing spaces – encourage family or interested viewers to watch a game by providing comfortable seating with the best views. These same spectators will patronize the bar and catering.

Johnny Sweeper, your Board is a business and has the resources. Profit from them!

See other articles here: http://yorkurbanist.com/2015/01/29/2015-ontario-scotties-as-economic-generator/ and, http://yorkurbanist.com/recreation/curling/curling-for-economic-good/