Real Tennis
Financial Model for New Court
Financial Model for New Court
Summary
Given a good catchment area and experienced professional, it is perfectly feasible for a well-run club to generate cash flow of around £50k pa which would enable external debt of £400k to be repaid with interest in just over 12 years.
Capital
- New court developed at an independent school as part of a larger sports complex with land provided as the school’s contribution; sports club established with charitable status
- Standard court cost at £1m including viewing galleries, dedans, professionals’ office and club room, plus professional fees and VAT for a total capital cost of £1.35m, payable in years -1, 0 and 1
- Grants and donations, including gift aid where appropriate - from the T&RA and Sport England: £350k; top five individual donors: £250k; next ten individual donors: £175k; fifty further donors: £175k
- Bank Loan of £200k and Debentures £200k – on commercial terms, repayable from year 5
Operating
- Membership subscriptions @ £300 pa for full members and £75 pa for junior and country members; also joining fee @ one year’s subscription; all attracting gift aid where appropriate
- Membership to grow from 25 full and 10 junior/country in year 1 to 125/75 by year six and then stabilise
- Court fees @ £27.50 per hour on average (between peak and off-peak rates), based on 15-hour day for 360 days per year; court usage to grow from 25% in year 1 to 75% by year 4 and then stabilise
- Staff costs – head professional and assistant with basic salary at £25k pa and salary supplement in year 1; incentive @ 60% of court fees
- Other costs – ball cloth, lighting, heating and marketing costs @ £12.5k in year 1 and £11/10.5k thereafter
