1. Textbook Assignment: Encore pg. 41 B – Thunderstorm A –
Gain or Loss Risks
Insurable Risks
Controllable Risks
Make the facility is well-lit, has adequate fire exits, staffed with security personnel, employees have been trained for emergency situations.
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2. Lesson 2.3 Business Ethics
Learning Targets
I can define ethics.
I can discuss the impacts of unethical behavior.
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3. Terms
Ethics
Principles
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4. DO ETHICS COUNT?
Ethics
a system of deciding what is right or wrong in a reasoned and impartial manner.
Note - All businesses should be conducted with integrity, trust, and fairness.
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5. Ethics and Character Matter
Principles
high standards of rules and guidelines.
Character Development
a progression in behavior - advance from childish behavior to mature behavior (it takes time).
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6. Common Principles in our society?
Don’t Kill
Don’t Steal
Common Principles for NCAA?
Can’t except money from boosters/agents
Can’t bet on games
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7. BUSINESS BEHAVIOR
People (businesses) should act ethically while pursuing a profit.
Athletes (teams) should act ethically while pursuing a victory.
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8. Seeking an Advantage
Dilemma - acting ethically when you observe others who receive a benefit from acting unethically.
PED’s (Performance Enhancing Drugs)
Corked Bats
Paying or giving gifts to recruits
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9. Controlling Bad Behavior
Professional Sports - Athletes
Fines
Reduced Playing Time
Suspensions
Game(s)
Season
Lifetime
College Sports - Athletes
Loss of scholarship
Professional Sports - Franchise
Fines
Salary Cap Hits
Firings
Removal of Owner(s)
College Sports - School
Reduction of Scholarships
Suspensions
Televised Games
Postseason Play
Season
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10. Being Bad Can Affect Profits
Only fans can really influence the behavior of ethically challenged athletes/celebrities/leagues by taking a stand;
Stop buying
Tickets
Products (Jersey, Apparel, and items from major Sponsors)
Voice displeasure
Letters s
Blogs
Protest
NOTE – if fans do not take a stand the bad behavior wont change because profit has not been affected.
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11. Effective and Ethical Good decisions are both ethical and effective.
Good decisions are the right choices for the long term.
Athlete who takes steroids -
Short Term – helps them perform at high level and perhaps helps team win
Long Term – player will eventually encounter serious health problems
Teams that establish core values and demand that players act accordingly will be the big winners in the long run.
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12. Textbook Assignment: Encore pg. 46 Answer Questions: #1, #2, and #4
your responses to the questions.
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13. Lesson 2.4 Financial Analysis
Learning Targets
I can discuss sources of funding and revenue for sports and entertainment businesses.
I can list and describe four tools for financial analysis.
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14. Terms Return On Investment Forecast Budget Balance Sheet
Income Statement
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15. IT TAKES MONEY
Profit is the primary purpose of sports and entertainment marketing.
#1 Goal of any business is to MAKE A PROFIT.
#1 Goal of any team is to WIN.
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16. Finding Funding
Funding for an event is typically provided by investors.
Example Costs – Celebrity Golf Pro-Am
Salaries
Promotions/Advertising
Player Fees
Course Fees
Event Workers
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17. Return On Investment
income from a venture that is distributed to investors.
Payment investors receive for providing financial backing (typically more $ than what they invested).
Initial Investment + Interest
Initial Investment + Agreed Upon $ Amount
Initial Investment + Interest + Agreed Upon $ Amount
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18. Money Sources Funds to repay investors are raised through;
Ticket Sales
Pre-Game Sales and Season Tickets
Broadcast Rights
TV and Radio
Licensing
Merchandise and Apparel
Facilities
signage, parking fees, luxury boxes, concessions
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19. WHERE IS THE MONEY? Forecast
a plan/report that predicts the expenses to be incurred and the revenues to be received.
NOTE – must always do your homework if you want a successful business/team.
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20. Budget a plan for how available funds will be spent.
Solid budgets list specifics - Income (money coming in) and Expenses (money going out).
Sole purpose of a budget is to control costs so they do not exceed the funds available.
Helps businesses/people to allocate money and not spend more than they have.
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21. Financial Statements Balance Sheet
shows net worth at a specific point in time.
(Assets – Liabilities = )
Assets = items of value, cash, property, equipment.
Liabilities = amounts owed for purchases made on credit and loans.
Income Statement
shows revenues and expenses for a specific period of time.
Reveals company’s profit or loss.
Both are used to show investors and creditors that the business/team is being managed properly and worthy of funding.
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22. Chapter 2 - Textbook Assessment
Pg. 52 Questions: #1 – #13 Pg. 53 Questions: #14 – #18 Pg. 54 Questions: #19 and #22
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23. Investor Do Their Homework
NOTE – reviewing the forecasts, budgets and financial statements is a must prior to investing.
Financial Analysis – Four Tools;
Forecasting
Budget
Balance Sheet
Income Statement
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