Understanding the difference between revenue and expenses is relatively easy. But thinking about revenues and expenses in terms of managing sport organizations is a bit tricky. Hoping for examples of revenues and expenses in sport? We’re going to help you out. We’ll break revenues and expenses down, giving you examples from the most common types of sport organizations.
Not sure why learning about finance is key to a successful career in the sport industry? We tell you why in this piece.
Have you ever wondered about how major professional teams are able to pay players millions of dollars to sign a contract with them? Or how non-profit sport organizations like U Sports, Canadian Olympic Committee (COS) and CAAWS manage to stay afloat? Or even how your local fitness centre makes money. We’ll tell you that and more. But first, we need to look at what revenues are in sport.
What is Revenue in Sport?
Revenue is the money that a sport organization brings in as a result of selling products and services.
Think about the amount of money Real Sports Apparel (Toronto Raptors official store) is raking in from NBA Championship gear being bought. In fact, according to the local Toronto and National news media, huge lineups are formed outside of stores across the city for a chance to purchase it.
CTV News reported that the NBAStore.com, the league’s official shop, set a record for (day-after the Championship win) sales. Whether it was a championship-themed shirt, shorts, bobblehead, jersey, or hoodie, fans wanted their hands on it.
The hottest item according to those many reports is the Raptors New Era Men’s 2019 NBA Champs 920 adjustable hat.
Customers must pay $42 Canadian for it, not including tax. So let’s say the shop sells 2,500 of them and each is purchased.
Take 2,500 items x $42
This $105,000 in revenue. It’s the money coming in as a result of selling the hats.
That’s just one example of revenue in sport. But there are many more examples of revenue in sport. Revenue varies a lot from sport organization to sport organization. The way money comes in depends on what the sport organization does. So in order to understand revenue better, let’s look at examples from a few types of sport organizations.
In this article, we’ll always give you examples of revenue and expenses in sport. And we’re going to categorize the industry into three categories so you can see examples of revenue and costs from a vast range of sport organizations. We’ve colour coded the categories to make things easy for you.
- Government Sport
- Commercial Sport
Let’s begin by taking a look at some examples of typical revenues in non-profit sport organizations.