Public Facility Management - Chapter 7
What are the types of facility rental deals and what do they include?
- Rent as percentage of net ticket sales. Net ticket sales * % = Facility Rent - Rent as determined by attendance. Drop Count * Predetermined $ per person = Facility Rent - Flat, predetermined amount - Co-Promotions. Splitting net revenue after both facility and promoter expenses have been deducted. - Rent plus expenses. Rental figure est. plus expenses incurred by the event such as conversion, cleaning, etc. - All-in. Rental figure predetermined to include rent and all expenses promoter will pay in lump sum.
What is the primary revenue of a facility?
Facility rent
What are the two categories of ancillary revenues?
Promoter related and customer related.
What are the two types of customers at a PAF?
Promoter/presenter - group renting the facility and providing primary revenues Customer/Event attendee - guest, consumer, patron who provide ancillary revenues to facility
What amenities should facilities provide to maximize parking ancillary sources?
adequate lighting; surfaces free of ice, snow, debris; workers present; safe for patrons to enter and exit (also by foot); emergency services
What is the facility managers' challenge?
attracting customers with discretionary time and income and maximizing the opportunity to sell "an experience" to them
What are the things a facility manager must consider in selling the event experience?
- Traffic near facility - Parking availability, ease of access and price - Ticket buying process - Ticket sellers, ticket takers, ushers and security helpful and courteous - Quality and price of food and beverage - Quality and price of merch - Restrooms clean - Event entertaining and professionally produced
What are examples of merchandise sales techniques?
1. Flat fee - fixed amount that does not promote max revenue 2. Per person fee 3. Percentage of sales fee (MOST COMMON)
What are examples of food and bev ancillary revenue techniques?
1. In-house - maintains financial control and flexibility 2. Contracted - proven systems, liability protection, capital investment management
What are the promoter related ancillary revenue sources?
1. In-house marketing (agency fee) for ad programs and group sales commiss. 2. Utility fees 3. Labor charge-back fees 4. Space rental 5. Equipment fees
What are the customer related ancillary revenue sources?
1. Ticketing 2. Food and beverage sales 3. Merchandise sales 4. Parking
How can facilities create additional ancillary revenues?
Pre-Event Parties 1. VIP Party 2. Block Party - outside facility offering live music, contests and promos with goal of getting customers to facility early 3. Premium seating meals
What are examples of ticketing ancillary revenue sources?
facility fees, service charges, VIP orders, interest income from ticket escrow accounts, reimbursable expenses from promoter.