Jonathan Dickey, Associate Director, Audit & Assurance
It has been said that the failure of businesses over the course of the pandemic has largely been due to the fact that their business models were out of date, and that the pandemic has merely hastened their demise.
For many sports clubs this narrative resonates, as they are currently seeking to change how they have operated for decades in a bid to enable them to survive.
So, what are the issues that are causing concern?
The funding of sports clubs was built on the central role they played in their local communities. They were social hubs that meant membership numbers were easy to fill (remember when each golf club had a waiting list?), bar and restaurant profits were healthy and available for reinvestment, members were happy to volunteer and provide their services for free, sponsorship from local businesses was easy to secure, and fundraising initiatives were well supported.
Over the last 20 years there has been a shift away from these dynamics. Bar and restaurant income is down significantly as social trends have changed and competition has increased. People seem to have busier lives, which has impacted membership numbers and lowered the engagement of those remaining members. As a result, there are fewer volunteers and less successful fundraising initiatives.
Added to this, the Coronavirus pandemic has created additional problems by not only reducing the enthusiasm of businesses to provide sponsorship going forward, but also by causing members to have been away from their club facilities for long periods of time. And unfortunately, it is proving hard to encourage them back.
The NI Executive provided a Covid-related Sports Sustainability Fund, to assist sports clubs and allow clubs to participate in the rates relief scheme. These schemes, together with the job retention scheme and other small grants, greatly assisted clubs to recover the losses incurred during the periods they were closed. However, they did not fund any capital works which needed to be undertaken, nor do they help clubs deal with reduced trading activity they are currently experiencing as they try to encourage members back to use their facilities.
The challenges ahead for Sports Clubs are clear. They need to embrace the direction being given by local councils and develop their facilities to support multiple sports and cross-community initiatives. They need to be innovative in how they attract their members back and engage them in the club and its future. And they need to attract the younger generations to not only join, but to remain active members as they age, and be prepared to volunteer and take on positions of responsibility.
Each club is unique in its facilities, membership, and local community, but the challenges facing all sports clubs are shared. Hopefully we will not see clubs fold and facilities enjoyed for generations put to alternative uses. It is in everyone’s best interests to support their local clubs as much as they can.
For further information or advice, Jonathan Dickey can be contacted at email@example.com
Grant Thornton (NI) LLP specialises in audit, tax and advisory services.