Written by Bradley Pasekoff
On August 11, 2020, Big Ten university presidents voted in favor of cancelling all fall sports for their 2020 seasons, a move seen as the first domino to fall, later leading to the cancellation of the Pac-12 conference’s fall season. The hope behind these cancellations was to take a more conservative approach in regard to navigating the COVID-19 pandemic, and as an attempt to avoid a possible resurgence of cases on college campuses related to the many facets of college football games, while delaying games to the early months of 2021 (Dodd & Silverstein). In addition to these two Power 5 conferences, multiple individual universities and smaller conferences followed the Big Ten’s lead and postponed their seasons. At the highwater mark shortly after the Big Ten’s announcement, 52 of the 130 Football Bowl Subdivision programs, the most competitive level in college, had postponed or cancelled their season.
This raised obvious problems, ranging from high-profile student athletes opting to raise their professional value through independent training to parents and fans alike holding rallies outside the Big Ten Headquarters in suburban Chicago. After just over a month of pressure from fans, players, and media members, as well as the start of seasons from the other three Power 5 conferences, which include universities spanning from Boston to Miami to Austin, the Big Ten decided to reinstate their football season on September 16 (Solari). While this was positive news for the universities who rely heavily on the lucrative television deals signed by the conferences on their behalf, the absence of fans in stadiums fails to alleviate any of the challenges experienced by the many small businesses in college towns that rely heavily on the 12-week football season to keep them afloat throughout the year.
It would be naïve to not believe that potential lost revenue had a substantial impact on the Big Ten’s decision to bring football back in some capacity this fall. With three member universities among the top eight programs across the country in terms of revenue from football alone – all topping $100 million – it is clear that universities were considering more than just the safety of their athletes, students, and spectators (Prescott). However, these colossal revenues do not even begin to paint the entire picture of the amount of money that college football brings in for the surrounding towns.
Before examining the entire picture, we must first understand the sheer amount of people that come to each and every game during a normal season. For simplicity, we will look at the three Big Ten universities that ranked in the top eight in football revenue – the University of Michigan, Ohio State University, and Pennsylvania State University. Fittingly, these universities are also home to the three stadiums with the largest capacities in the Western Hemisphere, with each capable of accommodating an excess of 100,000 fans and routinely filling to full capacity every gameday (Chiusano). This massive influx of people week in and week out provides a large boost to the local businesses that rely on football fans, many of whom have stayed loyal to the same coffee shops and restaurants for years, to keep them afloat during the quieter months.
During a recent interview with the Michigan Daily, Nancy Eubanks, the catering director for Zingerman’s Delicatessen, a popular gameday spot in Ann Arbor, claimed that the deli expects to make $250,000 in a typical fall season (Mackie). As only one of the many restaurants across campus, albeit one of the more popular ones, the scale of the losses from the absence of fans starts to be imagined when considering every impacted business. A study of the 2013 University of Michigan home football games by the Anderson Economic Group estimated that of the $81.8 million generated for the Ann Arbor area, roughly $28.1 million was by way of indirect economic impact, thus circulating throughout the numerous small businesses in the area (Anderson Economic Group). It is not hard to see how an unexpected reduction from this revenue to essentially zero would be difficult for businesses to cope with.
In State College, Pennsylvania, home to Pennsylvania State University, the loss of the fall season has similarly dealt a significant blow to many local businesses. Harpers and Family Clothesline, two popular apparel stores that have been on the campus for decades, both saw significant decreases in revenues that forced them to adapt their business models in order to survive the reduction in customers. Despite losing 75% of their pre-coronavirus level of business, Family Clothesline was able to keep their doors open through an increased emphasis on the online portion of their business (The Express). While this is a successful tactic in the interim for some businesses, others are unable to make this quick change. For instance, Espresso Royale, a popular coffee shop with locations in multiple Big Ten college towns, has been forced to close many of their stores. Two of the three locations in Ann Arbor have been designated as permanently closed, while another location in East Lansing, Michigan, home to Michigan State University, has also announced their plans to close (Kaminski & Stocken).
While bringing football back in some capacity may objectively be the correct financial decision for the Big Ten in regard to the bottom lines experienced by the member universities themselves, this unfortunately will not provide any relief for the surrounding areas without the introduction of fans to the games. And at the rate that COVID-19 cases are currently growing, this does not appear to be something that is on the horizon any time soon.
References
Anderson Economic Group. (2015, October 15). The Economic Impact of University of Michigan Football in the Ann Arbor Area. Retrieved November 01, 2020, from https://www.andersoneconomicgroup.com/the-economic-impact-of-university-of-michigan-football-in-the-ann-arbor-area/
Chiusano, A. (2020, September 04). The 25 biggest college football stadiums in the country. Retrieved November 01, 2020, from https://www.ncaa.com/news/football/article/2018-07-30/25-biggest-college-football-stadiums-country
Dodd, D., & Silverstein, A. (2020, August 11). Big Ten cancels college football season for fall 2020, hopes to play in spring 2021. Retrieved November 01, 2020, from https://www.cbssports.com/college-football/news/big-ten-cancels-college-football-season-for-fall-2020-hopes-to-play-in-spring-2021/
Jones, D. (2019, March 14). Which are the richest and poorest Power Five college football programs? Here are all 65, ranked bottom to top. Retrieved November 01, 2020, from https://www.pennlive.com/pennstatefootball/2019/03/who-are-the-richest-and-poorest-power-five-college-football-programs-here-are-all-65-ranked-bottom-to-top.html
Kaminski, K., & Stocken, S. (2020, September 4). At least 70 businesses gone or paused. Retrieved November 01, 2020, from https://www.lansingcitypulse.com/stories/at-least-70-businesses-gone-or-paused,14931
Korn, M., & Bachman, R. (2020, August 16). As College Football Games Vanish, So Do Their Millions. Retrieved November 01, 2020, from https://www.wsj.com/articles/as-college-football-games-vanish-so-do-its-millions-11597586426
Mackie, T. (2020, August 24). ‘It’s going to be devastating’: In Ann Arbor, businesses stare down a fall without football. Retrieved November 01, 2020, from https://www.michigandaily.com/section/football/%E2%80%98it%E2%80%99s-going-be-devastating%E2%80%99-ann-arbor-businesses-stare-down-fall-without-football
Prescott, A. (2020, August 16). Financial Impact of College Football Revenue at Big Ten Schools. Retrieved November 01, 2020, from https://www.si.com/college/ohiostate/news/football-revenue-big-ten-schools
Solari, C. (2020, September 16). Big Ten football reinstated: Here’s what we know about when they’ll play, daily testing. Retrieved November 01, 2020, from https://www.freep.com/story/sports/college/2020/09/16/big-ten-football-2020-fall-season-restarting-kevin-warren/5819427002/ The Express. (2020, September 8). As college students return, small businesses struggle. Retrieved November 01, 2020, from https://www.lockhaven.com/news/local-news/2020/09/as-college-students-return-small-businesses-struggle/