FINANCIAL PROJECTIONS

Team Owner Finances


Forecasted Expenses & Revenues

IMPORTANT NOTE:

Expenses & Revenues will vary depending on how Team Owners decide to build and operate their business.

The following numbers are estimates that should work for most teams.
 

First Year Forecast

Expenses: $4,245,000
Revenue: $9,150,000

Finances Breakout Example

 The Los Angeles Location 

​First Year Forecast

Expenses: $5,155,000
Revenue: $17,400,000

Los Angeles Team – Expenses Forecast Breakout


Expenses will vary depending on how the Los Angeles Team Owner decides to build and operate the business. The following numbers are estimates that should work for the LA team.

 

First Year Total Expenses Forecast

$5,155,000

Office Expenses:
$7,500 per month, $90,000 per year.

This includes office space, furniture, equipment and supplies. The Los Angeles area offers the whole gamut when it comes to office space. You can get ridiculous and pay over $40 per sq. ft. for an office on Sunset Blvd.
Or you can pay around $35 per sq. ft. and hang out on Santa Monica Blvd. Or you can pay $21 per sq. ft. for a space downtown LA on Grand Avenue. Or you can find a nice spot outside of the Los Angeles area for less than half the cost. Or you can work from a home office and save thousands of dollars.
The LA team job functions can be handled through virtual offices. Most LA employees prefer to work from home and avoid the traffic. The LA Team Owner has complete control of this expense.

Team Support Staff:
$225,000 per month, $2,700,000 per year.

This includes team General Manager, Coach, and Administrator. This also includes Sales/Marketing team, plus finance and legal services. The Professional Golf League only requires 3 different types of headcount.
The Team must have a General Manager who will be the main PGL contact. The Team must have a Coach that organizes and manages the golf pros. The Team must have the Players who compete in the games. There is no reason to get crazy and bring in a ton of headcount. A General Manager and Administrator should be able to handle the work. If needed the team Coach and team Players can help the GM and admin. Plus, the Sales/Marketing team can also help when needed. The Team Owner will want to build a strong Sales/Marketing team. Just like most businesses, the Team Owners financial future is based on the performance of the sales and marketing team.

The team support staff cost will be based on how the Team Owner decides to build and organize the business. The number of full time employees, the number of part time employees, the number of seasonal employees, the job functions outsourced, and all other staffing decisions will play an important part in overall team support staff cost. The staffing model and cost will be up to the Owner.

The LA Team Owner has complete control of this expense.

The Team Golf Pros:
$1,165,000 per year

Majority of this expense will occur during the regular season May - October.

Team player breakout:

Players get paid $1,000 per week for each week they are on team and working.
With 10 players on team, each working 45 weeks = $450,000 per year.
The number of weeks will differ depending on territory and activities planned.

Players get paid $3,000 for each game they participate in.
With 22 games and 7 players per game = $462,000 per year.

Players get paid $1,000 for each match they win.
The 7 players on each team will play 3 matches per game.
So, each game will result in 21 match winners = $21,000.
Team that loses game pays the players that won their matches.
Plus, losing team pays winning team coach $2,000.
Based on a 22 week season if you win all games this cost is $0 per year.
However, if you lose all 22 weeks the cost is $506,000 per year.
For budgeting purposes we added $253,000 per year to the forecast.
This would be the actual cost for a team that loses 50% of their games.

The players probably won’t be engaged for the full year and therefore could be part time employees or Independent Contractors instead of full time employees. This will depend on all the activities that are planned throughout the year. And it is always good to check with a tax expert on hiring guidelines.
Each state is different.

Operating Cost:
$600,000 per year

Majority of this expense will occur during the regular season May- October.

This includes golf course, home games management, travel, team uniforms, and all other operating expenses.

Miscellaneous Cost:
$50,000 per month, $600,000 per year

You just never know when those unexpected expenses will popup. It is always a good practice to plan for additional and unexpected cost. Hopefully these unplanned costs don’t happen, at least not $600,000 worth, resulting in your team expenses coming in lower than the planned budget.

Expenses Summary:

Over 50% of the forecasted expenses are controlled by the team owner.
With some creativity and excellent planning the expenses could easily be under $4,000,000 for the first year and the following years as well.

Los Angeles Team – Revenue Forecast Breakout

Revenue - First Year Forecast

$17,400,000


IMPORTANT NOTE: Revenue will depend on how the Los Angeles Team Owner decides to build and operate the sales and marketing team. The quality of the Sales Team will be the difference in a prosperous businesses and a struggling business. The following numbers are conservative estimates that should be reached.

Sponsors:
$10,950,000

Sponsorships should be the Teams #1 revenue producing focus.
The types of sponsorships vary and are many. A few examples would be team sponsors, game sponsors, match sponsors, hole sponsors, team tryout sponsors, team golf lessons sponsors, team school event sponsors, team charity events sponsors, and many more.

Sponsors will be major corporations and local businesses.
All the local businesses should be involved with their local pro golf team in one way or another. The Sales and Marketing team need to make sure that happens. A good sales team will have no problem blowing away the listed number.

In Los Angeles County there are over 244,000 businesses per lacounty.gov
There are 1232 companies with headquarters in Los Angeles County.
There are over 76 restaurants with headquarters in LA County.
There are 15 of the fortune 500 companies located in LA County.
Los Angeles County is a sponsor goldmine just waiting for the prospectors.
Plus the Los Angeles pro golf team will be the closest team to Ventura County, Santa Barbara County, San Luis Obispo County and Kern County which leaves the door wide open for extra revenue.

Mattel, a fortune 500 company in Los Angeles would be a great team sponsor.
A big focus of the Professional Golf League is visiting the schools and parks reaching out to the kids. The PGA would be a terrible sponsor for Mattel, but the PGL would be a perfect fit. This is true with thousands of businesses. The PGL will be reaching out to more than just the wealthy adults. Disney and Direct TV are two other fortune 500 Los Angeles County companies that could benefit sponsoring a professional golf team focused on reaching the younger generation.

With over 1230 companies headquartered in LA County the sponsorship opportunities are endless. Guitar Center, True Religion, Naked Juice, Trader Joe’s, and all the others would be foolish to not get involved with the newest and going to be most visible sports team in the area. The golf pros will be spending most of their time out in the community with the people.

The LA Sales team needs to take advantage of the 76 plus restaurants headquartered in LA County. Work out deals, setup booths at the games and events, get creative – the restaurants, the LA golf team, and the consumers should all win with this opportunity.

Don’t forget about all the other restaurants that are not a part of major chains.
There are millions of sponsorship dollars out there waiting.

Take advantage of the 244,000 plus businesses in the LA County.
Get 100,000 of them to do $100 sponsorships which = $10,000,000.
Even small $100 sponsorships ad up. Standalone restaurants are perfect fit.
Just about every business could afford $100 for what they will get in return.
With this many businesses the opportunities are endless. And don’t forget the other nearby counties looking for a team to support.
A good and creative sales team will see all the opportunity that the Los Angeles market has to offer and should plan on more than $25,000,000 in revenue. But let’s plan on just an average team with a little bit of creativity. It is always better to blow away the forecasted target.

Broadcast:
$3,900,000

This includes TV, radio and all other media.

Los Angeles County has over 25 local TV stations. Plus over 100 radio stations that can he heard throughout the LA area. The Los Angeles team should partner up with one or more of the local broadcasting teams. The local broadcasters can show the local home games. This will be one of the many benefits for the sponsors. The local stations can have special programming with the pro team.
There can be weekly interviews, weekly golf tips, weekly golf lessons, and much more. Have viewers call in with questions, give away prizes, get creative. This works for both TV and radio.

A good sales and marketing team should be able to easily exceed this number.

Merchandise:
$1,800,000

This includes hats, shirts, golf balls, golf clubs, and all other items sold locally.

The merchandise can be sold at the team activity events, the team home games, and at all the local stores and businesses. Many of your sponsors should be able to sell stuff and have fun doing it. The local broadcasters should be able to sell your merchandise as well. The number listed represents the profit dollars, not the sales dollars. It will be very easy to blow away the number listed.


Team Activities:
$750,000

This includes golf lessons, golf academies, golf camps, and all golf events including charities and community events.

The income produced by these activities is based on the effort put forward by the team. Team activities should be a high priority since it involves the community. The number listed is very conservative and should be nowhere close to the actual number achieved. If the team activities are administered correctly the revenue can go over $1,000,000.

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