Fourth Down and Out of Luck

4TH DOWN & ЧТН OUT OUT OF LUCK WHAT AN NFL LOCKOUT COULD MEAN FOR SMALL BUSINESSES After months of failed negotiations and a subsequent lockout, it seemed like professional football would have to sit out for at least part of next season. A judge has ordered the NFL to lift the lockout, but appeals threaten to hold up the season even longer. The league stands to lose billions if the two parties can't come to an agreement and the season doesn't take place. But NFL players and owners aren't the only ones who stand to lose out. OO THE DISPUTE The two parties can't agree on how to divide up approximately $9 billion in revenue. 2.4 BILLION 18% 1 BILLION Splitting Billions Down The Middle Owners are looking to increase their The players have been fighting to maintain a 50-50 overall take from $1 billion to $2.4 billion. The move would cut players' revenue revenue split with the owners, which the owners have refused. A 51-49 split favoring the owners has been put on share by about 18%. the table, but the NFL Players Association has refused. When professional players and owners can't agree, the costs add up quickly. The longer work stoppages last, the more costly the EXPENSIVE LOCKOUTS IN HISTORY lockout becomes. NHL 1972 1981 1994 2004 13 50 232 310 DAYS DAYS DAYS DAYS LEAGUE NATIONAL HOCKEY MAJOR MAJOR LEAGUE PASEBALL MAJOR LEAGUE BASEBALL LEAGUE BASEBALL $6 MILLION $150 MILLION $800 MILLION $3 BILLION in lost revenue in lost revenue in lost revenue and salaries in lost revenue and salaries and salaries and salaries SMALL BUSINESS IMPACT ADDING UP THE LOCKOUT Businesses large and small in each of the NFL's 32 cities stand to lose a lot if the season doesn't take place. NFL Players Association estimates an AVERAGE LOSS OF $160 MILLION IN LOCAL SPENDING IN EACH LEAGUE CITY if a full-season lockout takes place. Of that $160 million, 50 to 70% would be losses sustained directly by local businesses. Lost players' salaries account 30 to 50% of the estimate in each NFL city. The NFL refers to these figures as "fairy tales," but independent estimates of the economic impact in various cities are in a similar ballpark, Beyond players' salaries and ticket revenue for stadium operators, small businesses across the country would be impacted by an THE RIPPLE EFFECT NFL lockout. Here, we take a closer look at several key industries and businesses that would feel the ripple effect. General manager of Silver Cloud Hotel- НОTELS Stadium, Bill Weise estimates that if the Seattle Seahawks don't play, the hotel will lose $150,000 to $200,000 for Independent hotels in stadium cities п п ш would feel the impact of a lockout any each of the 10 weekends there would п п ш weekend there would have been a have been a game at neighboring scheduled home game, which draws Qwest Field - totalling as much as football fans from far and wide. $2 MILLION Silver Cloud Hotel-Stadium OVER THE ENTIRE SEASON. Seattle, Wash. Jerry Watson, owner of Stadium View Bar & Grille, says the 10 NFL Sunday home games account for 1/3 of total business annually. Including away games, he estimates that the RESTAURANTS STADIUM VIEW Restaurants whose business peaks NFL SEASON $750,000 IN GROSS INCOME. during NFL Sundays or who are situated near stadiums will no doubt feel the BRINGS IN absence of game day business. The lockout would be especially painful following the local Packers' championship Stadium View Bar & Grille season last year. Green Bay, Wis. SideBAR Owner Michael Sinensky says the 21 NFL Sundays account for Isidel SPORTS BARS $300,000 OR 8% OF TOTAL O REVENUE. For many independent sports bars, NFL Sundays bring in a large amount IN REVENÚE of business. Without games to watch, The average non-NFL Sunday brings in $2,000, but that number jumps 600% to fans will likely choose to spend their SideBAR New York, N.Y. Sundays elsewhere. approximately $12,000 on an NFL Sunday. Andrew Magick of SportsMagick estimates business could be off 20 to 33% if the lockout continues into the 84 MERCHANDISE STORES SportsMagick season. That would add up to about Licensed NFL merchandise generated $200,000 PROFIT LOSS NEXT YEAR. about $2.7 billion in retail sales in 2010. If football fans are deprived their favorite He adds that online business will help sport because of negotiations, many cover the loss from decreased foot SportsMagick Glendale, Ariz. won't feel like buying their merchandise. traffic that usually comes with a nearby Cardinals game. Todd Roser, owner of Roser's Fine Dry OTHER BUSINESSES Cleaning, says about DRY CLEANER 1/4 OF THE COMPANY'S BUSINESS IS TIED TO THE NEW ORLEANS SAINTS - cleaning uniforms for stadium employees Independent restaurants and bars aren't the only ones hoping for an agreement. A variety of other businesses depend on the league and its players to conduct and personal dry cleaning for players. The business as usual. absence of off-season workouts or training Roser's Fine Dry Cleaning Kenner, La. camp would take a toll on his business sooner than the start of the season. HUMAN COST COST OF GOODS YOU'RE FIRED, The NFL Players Association estimates that 3,000 PEOPLE IN EVERY CITY THAT Food and beverage suppliers could also feel the ripple HOSTS AN NFL TEAM. WILL LOSE THEIR JOBS effect of an NFL lockout. The absence of hungry and thirsty NFL Sunday fans will cause restaurants Beyond those parking attendants and concessions vendors, small businesses will have to cut back on the staff they and bars to scale back their purchasing. Millions typically employ to help with game day business. Edgeworth of dollars in spending could be cut if a full-season Economics, which conducted a study of the impact in NFL lockout takes place. cities for the NFLPA estimated that more than 115,000 jobs would be lost nationwide as a result of the lockout. QuickBooks Online intuit. Sources: Bleacher Report, The Associated Press, CNBC, USA Today, Inc.com, Fortune, Huffington Post, NFLLabor.com