Being a sports manager requires an understanding of all aspects of the industry and facility you are working for. This includes the financial side of things. Being able to manage a successful fitness facility requires a sharp set of budgeting skills that have been honed to not only facilitate the survival of a business but also to ensure its growth.
To do this, the business’ finances need to represent a well-oiled machine that is as characterised by a healthy cash flow, sustainability and growth.
In this regard, facility managers and sports managers need to hold a number of financial management skills aimed at:
- Maintaining cash flow,
- Understanding the financial requirements of the facility and its undertakings,
- Understanding where available funds are best spent, as well as
- Compiling accurate, detailed reports on the financial activities of the facility.
Let’s explore each of these crucial skills in more detail.
Maintaining Cash Flow
Cash flow is the life blood of any business. The most successful businesses manage their cash flows as an intricate ecosystem and maintain a careful balance between funds coming into the business and funds being spent.
In terms of fitness facilities, or even personal training businesses of all sizes, budgeting correctly for the flow of cash is a continual, monthly cycle.
Cash comes in from customers or clients or, in some cases, from allocated funds. This may come in the form of membership fees, accounts received or once off-payments. It’s largely dependent on the costing model of the business.
The cycle of cash flow also necessitates that money is going out of the business since each operation comes with its own set of expenses. Consider the cost of the premises, employees, power and water, maintenance and mortgages to name a few.
Maintaining optimal cash flow means being able to keep your finger on the pulse of everything that is coming in, as well as everything that is going out, and working to maintain a favourable ratio of profit to expenditure.
Financial Requirements for Projects and Facilities
Sporting facilities have a diverse and extensive list of requirements which are largely dependent on their type, their operations and their scale.
Gyms, for example, have different financial needs to country clubs and golf courses which in turn have demands that differ to football stadiums. It’s all relative to the type of institution and the purpose that they serve.
For each of these facilities, there are a number of costs. There are the:
- Short-term costs for daily tasks;
- Long-term costs such as maintenance, expansion, insurance and the like; as well as
- Cost of events or activities, if you are running the type of facility that hosts or organises fitness events.
The diverse financial challenges that face fitness facilities make sports management a fairly intricate affair where budgeting is concerned. Practitioners and consultants need to be fairly adaptable while still holding a sound understanding of the financial requirements of the fitness industry as a whole, as well as their specific facility or business.
Maintaining an Economic Enterprise
Maintaining an economic enterprise means not only knowing where the business is spending its money but also understanding where it should and shouldn’t be spending it.
That doesn’t mean that both costs and corners should be cut at every turn, but rather that an understanding should be fostered of where expenses are enhancing and supporting your business and where they are simply taking away from it.
Being able to draw accurate and realistic budgets that take into account the most beneficial costs of the business, while eliminating the unnecessary ones, is an essential part of maintaining cash flow and enabling the growth and sustainability of the business
It also allows you to offer your clients added value by focusing your costs and bettering your facility.
Being able to collate information about the gains and expenses of a facility is an essential skill for sports managers. Generally speaking, there are stakeholders involved on a financial level who expect transparency in terms of the finances of the business.
This means that sports managers need to be able to create accurate and understandable reports regarding the facility’s budget and how closely the business has stayed within its confines throughout its operations.
Want to learn more? Take an online sports management course through the Trifocus Fitness Academy. Enrol today by visiting our website where you can also find detailed information about our extensive collection of internationally accredited fitness courses.