Sports Teams and Clubs
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 1,100 sports teams in the US participate in live sporting events before a paying audience. The industry includes professional and semi-professional teams but does include leagues. Major sources of revenue include admissions fees; broadcast and other media rights; advertising; events produced under contract; and meals, snacks, and beverages. Major sports include baseball, basketball, football, hockey, and soccer.
Dependence on Broadcast/Media Rights
Broadcast and media rights account for almost one-third of revenue.
High Labor Costs
The sports industry is labor-intensive; labor costs account for about 40% of sales.
Industry size & Structure
The average sports team employs about 75 workers and generates about $38 million annually.
- The sports team industry consists of about 1,100 firms that employ about 83,000 workers and generate almost $42 billion annually.
- The industry is concentrated; the top 50 companies account for over 60% of industry revenue.
- The most valuable NFL teams include the Dallas Cowboys, the New England Patriots, the Los Angeles Rams, and the New York Giants, according to Forbes. The most valuable MLB teams include the New York Yankees, the Los Angeles Dodgers, and the Boston Red Sox.
- Women’s teams may be part of the same sports leagues as men’s teams (like the WNBA and the NBA) or completely separate entities.
Industry Forecast
Sports Teams and Clubs Industry Growth
Recent Developments
Jul 2, 2024 - Revenues, Employment Up
- Revenue for spectator sports, including sports teams and clubs, increased 2.3% in Q1 2024 compared to Q4 2023, according to the latest Quarterly Services Survey from the Census Bureau. Employment by sports teams and clubs increased 24% in April 2024 compared to a year ago, according to data from the Bureau of Labor Statistics (BLS). Employment by sports teams and clubs has grown almost 70% since before the pandemic. Average wages for nonsupervisory employees at spectator sports were up 13% in April 2024 year over year to $26.88 per hour.
- According to CNBC, admission prices to sporting events were significantly higher than the consumer price index (CPI) of all items in May 2024 compared to a year ago. Admission prices for sporting events rose 21.7% in May 2024 compared to a year ago, the highest rate of items included in the index, compared to 3.3% for the CPI, per Bureau of Labor Statistics data. Meanwhile, admission prices to movies, concerts, and theaters only rose 3% during the same period. A Bankrate report mentioned by CNBC showed that 38% of adults are willing to take on debt to travel, eat at restaurants, and see live entertainment, as demand for out-of-home entertainment continues to be strong. Specifically, the report said 27% of adults would go into debt to travel, 14% would go into debt to dine out, and 13% would go into debt to see a live sporting event, attend a concert, or go to the theater.
- The US sports teams and clubs industry is projected to grow at a CAGR of 5.5% between 2024 and 2028, according to a forecast from Inforum and the Interindustry Economic Research Fund, Inc. The expected growth rate is faster than the overall economy's projected growth. The report noted that consumer confidence levels in the forecast window are expected to improve, which bodes well for the arts, entertainment, and recreation industries. Additionally, consumer sentiment has seen a degree of improvement following sustained lower levels. As noted in the report, many older workers retired in recent years rather than endure pandemic-era employment challenges. The retirement population is expected to continue to rise rapidly as the Baby Boom generation retires. Per the forecast, "Greater opportunity for leisure for this large and growing segment of the population could drive demand for many arts, entertainment, and various recreational activities, particularly those that serve older people."
- Recently drafted college basketball superstars such as Caitlin Clark are driving up WNBA ticket sales and raising the league’s profile for the upcoming season, according to SportsProMedia. StubHub has seen ticket sales jump 93% compared to last season, and Clark’s team, the Indiana Fever, has seen a 13-fold increase in sales. The average ticket price for an away Fever game has jumped 80%, reaching an average of $175, the highest of any team. The Chicago Sky has seen sales triple compared to last season after adding college stars Angel Reese and Kamilla Cardoso. The defending champion Las Vegas Aces has seen ticket sales jump 190% compared to the same time last season. According to StubHub’s Adam Budelli, “New stars like Caitlin Clark, Angel Reese, and Kamilla Cardoso are bringing their impact from NCAAW Basketball to the WNBA to continue the surge in popularity that we’ve seen for this league.”
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