As many countries have shut down public events, athletes and race directors are struggling to come up with a plans that will keep athletes happy, while also allowing them to stay in business, as events are postponed and cancelled.
While most athletes are very understanding of the challenges race directors are facing around the world right now, there are a few who have been critical as races have been postponed and cancelled due to the COVID-19 Coronavirus Pandemic – some even suggesting that “cancelling an event can be a cheap way out for the race director.”
“I want to thank you for your trust, and for the massive support you have shown to our dedicated race directors, who’re facing incredible hard times,” Challenge Family CEO Jort Vlam said in a statement yesterday. “On social media we noticed some discussions about the myth that cancelling an event can be a cheap way out for the race director. Of course it isn’t. Ninety percent of all costs are due two to three months prior to an event; most of the products have been ordered, and services have been contracted. Postponing or even cancelling a race is always a worst-case scenario for everyone involved: athletes, the organization team, volunteers and sponsorship partners. So we’re all in this together, seeking the best possible solution for everyone involved, and at the same time accepting the fact, that everyone has to give up a little piece of their personal ideal situation.”
Here in Canada, John Salt, the founder of Ontario’s Multisport Canada Triathlon Series, takes Vlam’s position one step further – he points out that losing a year’s worth of revenue is devastating for most races, and would put a race series like his out of business.
“I would strongly suggest that if an independent race or series of races were to lose a year of race revenue, they would be bankrupt,” Salt continues. “Some may say, well that is the cost of doing business, (and) they would be right. However, if you think beyond that, it also means possibly not being able to compete in a local race, as it would not exist.”
Salt concurs with Vlam’s point that many race costs are spent months in advance. For example, the Multisport Triathlon Series has already ordered all the race medals for 2020 – a deposit has been made and the balance of payment will be due on delivery. That’s whether there’s a race season or not. (Most races these days order T-Shirts just before the race, so the events won’t be on deck for that cost, but a lost summer of racing could be devastating for the companies that produce the shirts.)
Salt offers some other insights on many of the myths athletes believe about races:
“I think there is a common misconception that if a race is long standing and successful, it equates to lots of profit going into someone’s pockets,” Salt says. “Over the years I have helped athlete/customers see past their math of: Race Entry x Number Registered – race specific costs = lots of profit.”
That’s not the case, Salt says. Fully half of the race revenue from the Multisport series and the Barrelman Niagara Triathlon (the largest independent half-distance race in North America) goes into overhead. That would include things like rent, equipment, staff, insurance and the other costs of running a business.
According to Salt, the world of race sponsorship has changed dramatically over the last five years, too.
“I can tell you from our experience and the many race directors I have spoken to here and in the U.S., cash sponsorship is possibly five to 10 percent of what it was back then,” he says.
It’s been frustrating for Salt to see comments in social media and on the internet about triathlon events being insured for cancellation.
“The assumption then is mass participation events have this available to them,” he says. “No they don’t! At least not in our segment of the industry. If you really think about it, what would the insurance cover? Would it be fees that have already been received? When would the insurance kick in? Would it be the annual total revenue a race or races have historically seen? How do you calculate the premium for something as nebulous as this? I can tell you we have researched this and haven’t found that insurance company. If there was one, why wouldn’t a event company give refunds?”
While event companies do have commercial and liability insurance (in some cases provided through a sports governing body such as Triathlon Ontario), that insurance won’t help cover costs if an event is cancelled. Even cancellation insurance offered by registration companies or events isn’t necessarily helpful.
“In my research … I reviewed the Active registration insurance (the company used by Ironman), and they specifically state ‘they will not provide a refund if the booked event is cancelled, abandoned, postponed, curtailed or relocated.’ I have also spoken to other providers and there is no consensus as to whether the Coronavirus pandemic will be a reason for reimbursing athletes for race fees if an event is cancelled. It would appear to be certain that this very circumstance will change the face of insurance in the weeks and months ahead.”
Salt says that offering insurance for smaller events would likely be cost prohibitive, too, making this a difficult option for smaller race series and events.
“On the local level races must be very mindful of the upper limit for race fees,” he says. “We are fortunate in that the reputation of our series races is excellent and many who have raced with us at Barrelman Niagara Falls compare the experience to as good as or better than a lot of the branded 70.3 races. While that makes us feel proud of our efforts … my sense is that increasing fees to include cancellation insurance, even as low as $10, would be extremely problematic and affect registration numbers.”
Salt quotes Kevin Radzinski, who recently posted the following on Facebook, as a final note: “If you’re getting upset that race directors aren’t quick to refund your money, consider what that would actually look like if they actually refunded your money??? It would mean NO MORE RACES. Our race fees are already spent long before the race and refunds would cause promoters to go bankrupt.”