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JOURNAL OF APPLIED BUSINESS AND ECONOMICS

A Strategy to Reduce Financial Risk Facing Intercollegiate Athletic

Departments from Variable Ticket Revenue

Author(s): David M. Hondula, David B. Knight, Donald P. Stewart, Aaron L. Williams

Citation: David M. Hondula, David B. Knight, Donald P. Stewart, Aaron L. Williams, (2013) "A Strategy to Reduce Financial Risk Facing Intercollegiate Athletic Departments from Variable Ticket Revenue," Journal of Applied Business and Economics, Vol. 14, Iss. 4, pp. 130 - 144

Article Type: Research paper

Publisher: North American Business Press

Abstract:

Revenue from ticket sales is an important, yet highly variable, budget component at many intercollegiate

athletics programs, thus exposing programs to considerable financial risk. We explore the potential for

athletic departments to reduce or eliminate this uncertainly via a risk management model. 71 NCAA

institutions were examined that met threshold criteria for ticket revenue importance and variability. Over

the four years 2007–2010 these departments collected ticket revenues 10% or more below projected

targets in nearly 25% of the cases examined. We propose that the $137 million in total unexpected

revenue shortfalls over the study period were avoidable.