Tuesday, 19 October 2010

Generating income

Chess players have money, at least enough to live on. And some chess players have more than that, especially to spend on things like books and software, for themselves of course. The challenge for tournament organisers (and even chess federations) is to try an redirect some of that money into the wider chess community.
The most obvious way is to organise tournaments that players want to play in, but from my own personal experience this is always a close run thing, with 'expected' prize funds always more than players are willing to fund. (Although I will say that there have been a few tournaments I have been connected with that now seem to be slightly ahead of the curve).
A slightly more subtle model (and possibly a more successful one), is to package your product as a 'service' rather than an item. An example of the success of this approach is FIDE, and the income it generates from rating fees. While there are concerns about prize funds for World Championships etc, FIDE do generate enough income to fund its day to day operations, built in part on the money collected from tournament registration and rating fees. I suspect the incremental nature of these charges (for organisers at least) is one reason for people being willing to pay.
Retailing equipment (for national federations) is also a kind of service, especially in areas where there isn't large commercial supplier. Botswana is one federation who built up its resources by retailing sets, using its built in advantage of being the official chess body in the country.
I've even seen non-federations use this model, with at least one Australian coaching business marketing their own brand of equipment.
Finally, the pay as you go model can work for clubs. Instead of trying to hit up members for a large membership fee (which hey tend to complain about no matter how small it really is), charging a small amount on a per tournament/night basis may give a larger return in the long run. Of course for this to work, you do need to make sure your customers keep coming back.

3 comments:

Anonymous said...

So, where are going with Shaun?
Are the club fees due? :-).

El Blog de Alex Rodríguez said...
This comment has been removed by the author.
El Blog de Alex Rodríguez said...

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