Then came COVID-19. It would be difficult to name an industry Is not The epidemic has been negatively affected, but the game has been hit particularly hard. For all the qualities and compulsive powers of the game, activities such as falling in one area, standing shoulder to shoulder with other fans, and screaming at the top of their lungs are less frequent due to less difference in social activities.
Even after the game resumed this summer, significant financial pain remained without fans. Nearly a third of Major League Baseball’s $ 10 billion in revenue comes from ticket sales. Tickets accounted for 22% of the NBA’s money – a loss of more than $ 500 million during the epidemic.
Then there are ticket brokers and resellers. In Los Angeles, with the Staples Center (capacity: 20,000), Dodger Stadium (56,000) and the new Sophie Stadium (up to 100,000) all closed … the Coachella Music Festival (250,000) was canceled until further notice .. . With the Hollywood Bowl (17,500)) on the Hetas … and even without Pac-12 college football this fall, Rudin is having a sudden loss of an estimated $ 50 million-plus year. “He would be lucky to load a quarter of 200,000 or so need a personal ticket to sell in 2020,” says Rudin. As you’d probably expect, “Rudin says.”
He is not alone. The stadium and arenas and theaters save for the odd interpoters as they sit empty – and collect dust on all those unheard seats, the worldwide ticketing business has been punished. Live Nation’s share price dropped from $ 75 per share to less than $ 30 a month later on February 19. Viagogo, who owns Stubahu, is deeply damaged; The company faced a class-action lawsuit over its slowness in returning customers, while Stubah cut two-thirds of its workforce. Countless small brokers and resellers unable to cope with the liquidity crisis have gone out of business altogether. “Put it this way,” Rudin says, “if you didn’t have savings in the bank, you’d be in a lot of trouble. You have zero income – you literally went from whatever you sold, No Income- So your bank looks at you differently. “
Adjacent to its essence, the ticket-resale business model is fairly simple: Barry’s tickets and its competitors buy blocks of seats from teams, venues, current season-ticket holders and other online sources. Rudin and his staff then turn around and sell those tickets for more than face value. Margins vary, but profits can be considerable.
No sports or music staged in front of fans — no supply, no demand — the collapse of the entire business model. It is not that revenue decreases to $ 0.00. It is also time and cash flow. While Rudin quickly returned his customers’ payments and did well with his creditors, teams and locations and credit card companies were slow. “I’ve spent millions of dollars over the years to buy tickets on American Express, and I’ve always paid on time,” he says. “Why do I wait from a month to six weeks to get my money back, especially when I need it, these days?”
He has already been asked to turn his traditional 50% down payment towards tickets for the next season (and he paid for the Chargers seat license at SoFi Stadium – money that was due on February 28). “Teams are not giving us all our money back; They are keeping it for next year, ”he says. “but [as a reseller] You can not tell your customer: Hey, I’m going to capture your money by next year. I am good for it. “
Rudin says that while most teams eventually returned the money from the canceled games, the pace varied. He hires the LA Kings as an organization that works quickly. Others were significantly less rapid; Some of those teams still owe him a partial return. (And while he was waiting for his funds to come back, the S&P 500 would increase by more than 30%.)
There is also talk of staff. With no revenue, Rudin was forced to remove or force employees – he reduced a workforce, which had grown from 44 to five full-timers at the beginning of the year. He received a paycheck protection program [PPP] The loan, which he estimates saved him 25% of his losses. “To get forgiveness, you had to return everyone for the first month, even if you didn’t need them,” he says. “The employees then realized that if they were placed in a temporary layoff, they would receive an additional week of health benefits. So I reinstated them, which helped to increase their profits. “
Although Rudin is not selling any tickets, he still has overhead, such as continuing his website. He still has a rented office in Calabasas. (The city of Luxe Hotel Office is now being used as an emergency homeless shelter, so the rent is waived.) They also have to hire their full accounting staff to deal with refunds, transfers and bookkeeping. “You just lose money every day,” he says. “You’re paying a credit line with nothing coming in.”
but wait. there’s more. Barry’s tickets do its fastest business to the postseason, especially when local teams are involved. Rudin says the USC-Texas 2006 National Championship at the Rose Bowl was the most profitable game of football in the company’s history. Given that COVID-19 hit in mid-March, Barry’s tickets missed all of his biggest revenue opportunities, most notably in the NBA, where Rudin once danced in the head of the Lakers-Clippers Western Conference Finals . Six months later, just one Clipper with that LA dream wins becoming an Orlando-bubble reality, no matter what.
In recent years, Barry’s Stamps – like most independent brokers – has faced a lot of challenges and commercial gains. StubHub, SeatGeek and Dynamic Ticketing became a collective ban of resellers. In sports, the formation of on location allowed some teams to control the secondary market themselves. When the Dodgers went to the World Series in 2017, Barry’s ticket at Dodger Stadium had more than 1,200 seats. Subsequently, Rudin says, the team struck a consolidation deal that effectively cut local brokers like themselves.
The same technology that makes more sales easier than ever and enables Barry to do the vast majority of his business online can also be a hindrance. Ticketmaster recently upgraded its technology to use IP addresses in hopes of identifying resellers and blocking their attempts to purchase ticket swaths. “Even before COVID,” Rudin says, “it was already getting harder and harder for a broker to succeed.”
But those changes, in retrospect, were blips compared to this existential crisis. Brokers and resellers prepare for the equivalent of mix-ups at the ticket window. Months without months anyone The ticket sold was unimaginable.
As the adventurous business has been in 2020, Rudin sees some room for optimism. For one, he predicts that when fans of the game and concertgoers finally return, the demand for tickets will increase. “There is a treatment or a vaccine at the moment, spigots are going on and people are going into music and sports like crazy.” He believes that the bright, shiny item that is the NFL’s newest venue, Sophie Stadium, will attract fans, no matter how it plays the Ram and the Charger.
Rudin also suspects that when the turnstiles start circling again and fans return in search of tickets, fewer contestants will be around to share in the reward. “You try and create an opportunity to get out of the crisis,” he says. “If you can keep it alive, you’ll get it out of a ledge.”
On a personal level, he sold and sold his house at the right time, and he invested some money in the stock market. He also got a glimpse of his future. “I get a taste of what retirement is going to be like,” he says. “Then I have to go back to work. This is not the worst thing in the world. ”
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