The NFL Lock Out

The owners will be affected because the revenues will definitely go down. The reason why the owners create the scenario of a lock down is to curtail the temporary expenses they undergo in while catering for the salaries and remunerations for the players. But whole the lockout is on, they are likely to lose moneys in the short term through television revenues, ticket sales and even merchandise dealings. The experts show that any temporary disruptions on such businesses may have an adverse effect on the investor because an American consumer has a unique and unpredictable way of responding to the market. If the lockout persists it may create a negative impression to the fanatics who may reduce the watching and participation in the NFL and switch to other sports.

In other effects of a prolonged effect, the stadia owners like private owners and high schools that may not be necessarily stakeholders in the respective teams may convert the stadia to be used by other sports such as rugby and even athletics since no contract binds them at that point in time. For instance the local YMCAs ground is reportedly planning to do the same if the current lock out persist.

Effect on the general economy

NFL is the world’s leading revenue collector sport in all aspects. This is a big chunk of economy and a disruption that may be possible by the current lockout. In one interview, a commentator said that America needs the sport and the sport needs an America. The impact is surely felt in the small business, the employees that are benefiting from the NFL as well as the big businesses. Statistics show that the media and other advertising agencies make up to a third of their revenue from sports related activities. This is an indication that the sport is a big time component that should be taken seriously.

The first casualties of the lock out in the perspective of the economy are the direct employees or vendors who are directly linked to the league. They include the ticket sellers, the hand jobbers, the brokers as well as the people working on menial jobs that are associated with the matches as well as employees of sorts bar who may get cut out due to the decreased revenues (Consumer justice Foundation).

On the other hand the bar owners will have to be more careful in making unnecessary expenses because Sunday afternoons which on a peak seasons is the highest time of the revenue collecting will no longer be expecting such amounts of moneys. The stores that sell the merchandise will lose a lot because of the inventory that is said to be dead will accumulate and the turnover decrease. But the most affected of them all is the government. The tax that is generated by the NFL is massive and is subject to the performance per season. It goes without saying that the essential services that are provided for by the government will decrease or cease for the time being before the crisis is resolved.

This entry was posted in Analysis Essay and tagged , , , . Bookmark the permalink.