 |
| The Acadie-Bathurst Titan enjoy a Memorial Cup win in 2018. |
Will it be millions and millions of dollars?
During the COVID-19 pandemic, money is the elephant in the room when it comes to sports organizations. It is pretty well known from a common sense type of view that sports organizations don’t have enough money to spend as the COVID-19 pandemic grips the world.
There is pressure on sports organizations to operate, because of the fear that if they are out of site they will be out of mind.
This fear is real in the sports world in Canada, and it appears millions will be spent by sports organizations to alleviate that fear. In far too many cases, sports organizations will be spending money they don’t have.
In Canada, you are seeing that with minor sports bodies, the CHL leagues and gate driven circuits like junior A hockey.
It is hard to know how much money is being lost outside of sports teams that are community owned, who make their financial statements public at an annual general meeting.
 |
| The Swift Current Broncos lost $791,000 on the 2019-20 campaign. |
From what I have been told, the sports industry in Canada is worth $2.6-billion. If anyone disputes that figure, I hope they feel free to pass on the source of what the correct figure might me.
On August 25, Forbes ran a column that said the sports industry in the United States is worth US$750-billion. It actually took a bit of work to search that figure out. The piece said the sports industry is the 11th biggest industry in the United States.
In just comparing the worth of the sports industry in Canada and the United States, it becomes obvious that the sports industry is taken a lot more seriously in the United States and the sports industry in Canada is not even close to being in that realm.
Of course, one will argue the United States has 11-times greater the population that Canada has. If you do the comparative math to make Canada’s population close to equal to that of the United States, Canada’s sports industry would be worth $29.7-billion in Canadian funds in that scenario.
If Canada’s sports industry was like that of the United States, Jeff Willoughby would be making $100,000 a year to be the head coach of the Prince Albert Northern Bears female under-18 AAA hockey team as opposed to picking up a yearly honorarium to do a full-time job.
That is the reality of most coaches who work in the sports industry in Canada. They have to make careers in other industries and basically volunteer their time to help elite sport.
 |
| Most U Sports teams are not in action in 2020-21. |
It should be noted almost all regular season and post-season competition in U Sports has been cancelled to due safety concerns regarding COVID-19 and the fact the financing is just not there to play.
Most sports organizations in Canada have seen various revenue streams like sponsorships and fundraisers dry up significantly during the COVID-19 pandemic. Organizations that are gate run leagues have to deal with crowd limitations due to COVID-19 restrictions.
In Saskatchewan at the moment, sports teams are only allowed to bring in 150 spectators to their venues at the moment. The Saskatchewan Junior Hockey League was hoping to be able to have more spectators than that when that junior A circuit’s regular season began.
This past Tuesday, the SJHL announced its regular season would start on Friday, Nov. 6, which is about four days after the circuit had been targeting to start.
Due to the rise of new COVID-19 cases in Saskatchewan, it appears SJHL teams will enter the regular season dealing with a spectator cap of 150. You have to wonder how much money each of these franchises will bleed.
Across Canada, junior A teams are leaning more and more on a model where players pay to play.
If each junior A team loses an average of $1-million on the 2020-21 season, would that justify taking the ice to play games to stay relevant?
 |
| The CFL couldn’t work out the logistics to hit the field in 2020. |
The losses of the three community owned WHL teams in Saskatchewan are known from a 2019-20 campaign that saw the tail end of the regular season and all of the post-season lost due to COVID-19 restrictions.
On Sept. 29, the Swift Current Broncos announced they lost $791,000 on the 2019-20 campaign. On that same day, the Moose Jaw Warriors announced a loss of $391,299 for 2019-20.
On Oct. 7, the Prince Albert Raiders announced they lost $331,895 on the 2019-20 season. In the Raiders case, they would have easily made money had they hosted their final two home regular season games and from their home playoff dates.
The losses of the Broncos, Warriors and Raiders were compounded by money they didn’t receive from the Sportsnet television contract for broadcasting CHL games. Sportsnet didn’t have to pay out for games that weren’t played due to the COVID-19 pandemic and from the Memorial Cup tournament that was cancelled in Kelowna, B.C., that annually determines a CHL champion.
Each of those teams’ losses included money that was put aside to settle a CHL-wide class action lawsuit that argued major junior hockey players are employees and not student-athletes and were entitled to employment standard compensation. The settlement for that lawsuit is undergoing further litigation.
A circuit like the CFL didn’t play any games, and teams there are bracing for big losses. Those losses would have been worse had the CFL played.
 |
| Saskatchewan U-18 hockey will start with capped crowds of 150. |
On Monday, all the sports facilities in Winnipeg will be closed for two weeks due to lockdown measures that were brought back in to reduce the rise in new COVID-19 cases.
During the month of October, the provinces of Ontario and Quebec brought back in restrictions. Near the middle of October in Saskatchewan, the provincial government limited private social indoor gatherings in the home to 15 persons.
Sports teams and minor sports organizations are going to have an increasingly tough time limiting the money they are going to lose.
When the pandemic ends, those sports teams and minor sports organizations are likely going to need sugar daddies or sugar mommies to pay off their unsustainable debts or be bailed out by governments. You get the feeling there will be a lot of organizations looking for a government handout.
On a money front, the debts these sports teams and minor sports organizations could be further limited by just not playing or by shutting down until the pandemic ends. Scrutiny will likely come to sports teams and sports organizations when those that don’t have an interest in sports will want to know if sports teams and sports organizations acted in an irresponsible manner financially and if that should affect any decisions on bailouts.
 |
| The Raiders will rely on their loyal faithful to minimize losses. |
Right now, way too many sports organizations and teams in Canada have actively decided to take the risk to play to stay relevant. It remains to be seen if these entities will have to pay the piper when all is said and done.
If you have any comments you would like to pass along about this post, feel free to email them to stankssports@gmail.com.
-------
If you like what you
see here, you might want to donate to the cause to keep independent media like
this blog going. Should you choose to help out, feel free to click on the
DONATE button in the upper right corner. Thank you for
stopping in.
