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OMG! $70 **PER TABLE** Luxury Tax
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(Verbatim from the follow document, unsigned and undated, buried obscurely in an innocuous E-mail sent to the Board of Governors):

"ACBL MANAGEMENT REPORT Fall 2018 – Honolulu, HI"

"Hawaii Loss

The fall NABC initially budgeted to lose $167K is now estimated to lose $630K. This is due to lower attendance and attrition damages from failing to meet the contracted hotel room block."

 

MY COMMENTS:

Presuming 8,000 tables at the Hawaii NABC, and **A LOSS OF $630,000**, the Membership is contributing a gift/subsidy of about $80 per table to the well heeled participants!

There was a time when NABCs were presumptive profit centers, from smallish, to huge.  NABCs are monopolies and are the showcase product, the "piece de resistance", of the ACBL  Do 165,000 people now pay 2,000 people big bucks to luxuriate and bask in the limelight? Apparently! 

Were this a corporate enterprise, the value of its stock would have tanked instantly upon news of either of these metrics, and both management and the BoD would have faced a severe challenge and/or outright revolt, if not an immediate demand for mass resignations.

Competent business management would have considered altering the event, perhaps drastically, or prepared well in advance to reduce any losses to a small, tolerable amount.   Competent management is responsible for making the organization financially viable and solvent.

This incredulous scenario brings to mind a joke told to me my long ago by a good friend: "We lose a little on every transaction, but we make up for it in volume!" :)

 

BOTTOM LINE:

Does anybody, at any level of ACBL Management, oversight or authority, see this as more than another "ho hum" and/or "another day at the office with business as usual"?!

WHAT CAN BE DONE RIGHT NOW, THIS MINUTE?

Mr. Whipple, while you and many others enjoy the gentle tropical breezes, and delicate native dishes, you can vote tomorrow, Thursday, November 22, an immediate increase in entry fees, raising each by $20 per session.  You can also decide, as a group, to pay your own entry fees, rather than paying $0 entry fees for the entire tournament.  Anything else is fiscal irresponsibility, and might be deemed by some as a breach of fiduciary duty.

 

IS THERE A LOGICAL LONGER TERM SOLUTION?

In 1988, I was teaching a Business School class* in Marketing Strategy, when a world renowned but petrified organization, approached me and asked for recommendations. I posed the case study to the class, and we proposed an early version of "variable pricing", which is now universally applied in the business world. In simplistic terms, if the League is to survive, it should price table fees on a variable basis to produce a break-even.

Since the Hawaii NABC+ event entry fee seems to be $25/session, and the hoi polloi are gifting, without permission, $80/table, simple math shows that each player at Hawaii is paying about $20/session LESS than necessary for break-even. Therefore, the entry fees should have been raised $20 per session, making an NABC+ event available at a cost of $90 per player per day.

THE MARKET WOULD THEN DETERMINE IF THE PRODUCT HAD SUFFICIENT VALUE TO SUPPORT ITSELF. PRESENTLY, CLEARLY IT DOES NOT . . .

*(My credentials are an MBA from the University of Michigan in Marketing and Finance)

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