Sports Franchise

Franchise is a common word or concept in the Business arena. This concept legalizes the selling product, bearing logo, managerial practice within the own independent business or organization supervised by the mother company. In strategic business decision, franchise covers many areas; sports is one them. In advanced nation, particularly Northern American style of business centralizes franchise; and it covers sport. Franchisor usually provide different guided tool to the franchise to run their operation.

Sports Franchise usually covers a certain number of teams under a one league. The sports may be rugby, golf, basketball, football or even cricket. Similar to other franchise, the franchisor of sport receive an amount as registration, as a result the registered team can have the guided facility of the franchisor. Each club has to generate their own revenue. Based on their accumulated revenue, the teams have to pay royalty to the franchisor. In sport franchise, the teams do not have to sell any products, which we can perceive or consume. The teams usually sell their service in the playground that we feel or enjoy, that is why the teams need not be worried about marketing other than sponsoring their brand.

In recent trends, the league can collect sponsorship, and the brand name usually seen their sports costume; the ordinance can get accustomed to the products which they can view on their sports costume while they are watching the game between the teams. If the team is at good position at the league table, the viewers like the teams and new fans usually be created, the old fans and new fans jointly seize a portion of a market share of the certain products which are on player's sports costume. The sponsor companies of the league as well as the club create marketing propaganda through sports. The sport franchise aids the strategic marketing of Multinationals or local companies.

Receipts at the gate: The audiences have to pay for each game, so that sport franchise authority usually incurs some healthy revenue. The accumulated revenues they use for field development, administrative cost of franchise secretariat, promoting cost for the event, as well as other direct and indirect cost can cover from gate receipts.

Television, Radio and Internet site sponsorship: The sport franchise authority of a certain league sells the sponsorship of the TV, satellite radio, and internet site. Therefore, they receive a handsome amount of money and this amount strengthens the monitory capability of the sports franchise authority.

Print media: In sports franchise, print media will cover the game schedule, the proposed or current event, its back office release, the game result, clubs failure and success. Therefore, the whole thing is rotating for the year, and people come to know the facts and findings of the event.

Sports Industry: To sustain the sports industry, the sports franchise is a feasible tool. The classical model of sports societies cannot think of balancing, modernization, replacement or expansion of the game ultimately the state interventions stick at the game, and the sick clubs getting sicker more and more. They do not think of create new generation of fans, as a result existing fan also starts diminishing.

What is ultimately: The sport franchise authority keeps the money for further revenues generation; they can invest surplus capital into the backward & forward linkage industries of the sport. Employment generate directly or indirectly. The registered players of each club under a certain league can be beneficial after retirement. They can have employed themselves or their son or daughter can be the priority list. State can relieve the burden a bit if the whole venture runs smoothly.

Last but not least: In a free market economy, the monopolistic view cannot be considered. Monopolistic view of sport franchise should not be encouraged. State intervention should be required that entry barrier is to be overlooked in the market of sport franchise, new entrepreneurs will create and generation of revenues to be more. It should also be counted that quality of the players usually not be prepared in a monopolistic franchise system, the authority naturally think of their loss-profit account, they pressurize the result, other than quality of the players.

To compete at the international level, the quality of players require, here horizontal approach is essential.