Sports Marketing Network
27 November 2013

Sports Marketing Network

Community sports clubs cannot treat their finances as an afterthought

Community sports clubs cannot treat their finances as an afterthought

A word from Svend Elkjaer of Sports Marketing Network...

The 2013 Club Survey, just published by the Sports and Recreational Alliance (around 2000 clubs participated), shows that 52% of clubs are worried about accessing funding in the next two years and 58% are asking for training and support in applying for funding.<1R>

The other day, at one of our Grow Your Sports Club workshops, I asked a club representative how the club was getting on. "Great", he answered, "we've just had a grant". So have we now our community sports clubs measuring their success based on whether they receive any grants? Not on membership satisfaction/numbers, community engagement, sporting endeavours etc.! I sometimes wonder whether we have developed community sports clubs which have become 'grant-addicts'.

Regardless of level, size and ambition as a sports club you must have a clear picture of how you are going fund your club. Do you really know whether you will be able to fund replacing that piece of equipment? Are you relying on philanthropic donors or are you constantly applying for ever-more rare grants? Or do you seek and win contracts with schools or health authorities to deliver anti-obesity and physical activity programmes? You might even consider becoming more enterprising and look at how to develop new services that consumers will want to pay for, because you are providing great experiences.

What is your financial strategy?

What is the attitude to financial matters within your club? Do you know? Is this something you discuss openly or is it left sitting 'under the carpet'? How do you fund your club and sport? Have you got a financial plan? Or do you have a 'we are sport, so all this business-jargon doesn't really apply to us' approach?

How do you finance the activities of your club? This should be at the core your club, your leadership and your thinking. It is simply no good to have an attitude where the coaches 'just want to do sport' and somebody else must make sure that the finances are in place to ensure that coaches' wishes are granted.

Having a 'Fund-raising Officer or Committee' which operates in splendid isolation from the rest of the club is rarely going to make a real difference to the financial state of your club. Whilst I am not disputing that a few dedicated 'fundraisers' can indeed generate some income at even the most insular clubs, their effort are often not sustainable, as these entrepreneurs lose their spirit because of the indifference from the rest of the club.

You must have a balanced income model.

You need to balance your objectives for your club with the different ways of financing them and your overall club. You also need to go from a mentality of asking/begging for money to earning your income - from un-sustainable fund-raising to sustainable income generation.

‘Sustainable income' is not simply a question of getting better at fundraising or locating one ever-lasting source of income. Sustainable income is about exploring income opportunities across a spectrum of funding streams; from charitable donations, through to grants, service level agreements and contracts, to social enterprise activity, trading goods and services. This not only spreads risk, but ensures that your community sports club is best placed to take advantage of emerging trends and opportunities and are able to safeguard your financial future.

It is important to recognise that there is no such thing as free money. Whether you are donor who makes a donation, big or small, a grant funder or a person who pays for a training session yourself you want something in return. It may be feeling confident that your money is doing something good, your grant is helping the funder to their objectives or a customer feels they are enjoying the sporting and customer experience to a value matching what they are paying.

So, you have to make sure, whichever way you are generating income for your club that you are providing value for money and you are really engaging with the people who give their money.

The four types of incomes - Donors, funders, purchasers and consumers - Get the balance right

  • Donors: In general a donor is a person who donates something voluntarily. This is pure charity. Of course there are a large number of examples where donors have given significant amounts of money. Some donors, often larger ones, do want to influence how their donations are being spent which can influence the workings of your club considerably. If you agree to accept regular donations from single individuals you really ought to regard that income as a kind of 'luxury' income and not become dependent on it. Remember, one of these days those donations will stop and you will have to run your club without them. Many small donors may take time to attract and keep engaged, but you are much less vulnerable if one of them stops donating. Please remember to thank your donors - you'll be amazed by how many who don't!

  • Grant funders: Grant funding is normally restricted to specified outputs or outcomes. Grant funders are likely to monitor what their investment is spent on will want to know if they are getting value for money. They will have clear expectations about what they will want to achieve for their money. They will want report on outcomes. Be very careful not to apply for grants where the required outcomes are too far away from what your club is really about.

    When applying make sure you stand out from the crowd - have a BIG idea
    • Research your potential grant funder as much as possible. What have they given money to in the past (and, importantly, what not!)
    • Build a relationship with the funder.
    • If at all possible build a personal relationship with somebody, hopefully important at the funder
    • Get to understand the guidelines. You may want financial support to improve your club house, but if the grant funder only wants to fund activities, then you must adapt your application. Full stop!
    • Are you eligible? Are you in the right location?
    • Are you the type of organisation that the funder wants to give grants to?

    Are you REALLY going to grow the number of people who play sport, create more jobs or training opportunities? It is a common complaint from funders that clubs are applying for grants just 'because they haven't got money' or 'need some better showers/pitches.'
    You simply have to demonstrate tangible benefits from the grant: How more people will be able to enjoy sport. How you will create opportunities for people improve their skills through sport.

  • Purchasers/ Commissioners.:This a relatively new, but growing way of community engagement and income for community sport. The concept is that you deliver a product or service, a coaching session for a school, a corporate sports day etc. A contract/agreement between yourself and a third party.
    A purchaser can buy services on behalf of other people i.e. a GP Consortium can buy a physical activity programme on behalf of a local group. Currently, the biggest commissioner of services is the NHS, mainly through local Health and Wellbeing Boards or Clinical Commissioning Groups. As a provider of community sport and physical activity you are in a prime position to be commissioned to deliver services to improve people's health.

  • Consumers/Businesses: The more you can develop events and services that your customers really enjoy, the more loyal they become and the more sustainable they become. This is NOT about running non-sport fund-raising activities such as bag-packing in the supermarket. These initiatives distract from what your club should be about, which should be about providing great sporting experiences in a sustainable way. Look at your membership as a way of generating income - people will pay for great sporting experiences. (I know of one David Lloyd where 8% (1,200) of the local university's students are members, paying around £70 per month - (cash-strapped students!). Multi-sport Corporate/Community Games, Doggie Walks, Midnight Sport, Holiday Camps, Birthday Parties, Vets Tournaments, Walking Sport for 60+ and Family Sport are just some of the events/initiatives that clubs, just like yours, are currently running which helps them to grow their clubs and increase their income... It can be done!

Sports Marketing Network, Tel: 01423 326 660 E-mail: [email protected]