Show You The Money

Most parks and recreation agencies operate food, and sometimes merchandise concessions in their venues and, most of the time, they could generate more income through these operations.

A concession stand can raise funds for your youth sports program.

The following steps should help in your examination of this aspect of your business (yes, you should consider the revenue generation portion of your job a business) and to help determine whether it’s earning to its potential.

Outsource or In-House?

Should your agency operate your concessions with internal staff, or should it outsource the responsibility to a specialist in the private sector?

Both strategies have positives and negatives associated with them and you should be careful to realize that a course of action that worked in another community may not work in yours.

This is due to a number of variables, such as (1) the level of competency within your organization and among potential contractors, (2) the public relations climate in your community, both internally and externally, and (3) how the terms of the relationship are forged between your agency and an outside concessions company.

Nonetheless, here a few rules of thumb that can help you analyze the situation:

• Determine the public relations ramifications of outsourcing this responsibility or taking it in-house. The issues of losing control or eliminating jobs, for instance, through outsourcing must be resolved. Likewise, the extra work burden and start-up budgetary considerations of doing concessions in-house could ruffle feathers.

• If you’re able to realize a cost savings through outsourcing, you may want to do it in-house, depending on your in-house staff situation.

• Determine if enough for-profit concessionaires exist that could handle your needs. For instance, do not think that the concessions management company that contracts with the local pro and college sports teams will submit a bid for your opportunity. Your facilities and events are probably too small to warrant the attention of these large companies. Investigate the smaller concerns and ensure that more than one has a good reputation for product and service.

• Evaluate whether your personnel has the proper expertise to maximize revenue from your concessions.

It’s all in the Packaging

If your analysis makes a strong case for outsourcing your concessions, package it correctly from the start. Most agencies have a number of different concessionaires who work in their many facilities (pools, golf courses, etc.). This array of vendors working under the umbrella of an agency limits the revenue it could be generating.

Instead, create a Request for Proposal for one company to handle all of your concession needs. This scenario creates greater competition among concessionaires and will increase the value of the bids you receive.

Additionally, if your recreation and parks department is large enough, you may now warrant the attention of larger concession companies that can invest more and upgrade the professionalism of your concession offerings. Finally, having one concessionaire as a partner will create more uniform service delivery and improve quality as perceived by your customers.

In the event you already have myriad relationships with separate vendors, re-negotiate your new contracts to expire in accordance with the latest termination date of your existing contracts. This way, all of your concession contracts will be up for bid at the same time and can be packaged together.

Of course, you will have to determine whether a single concessionaire in your municipality can provide all the services you need. If not, arrange your concession RFPs into a few groups you know can be handled by a few different companies.

The idea is to have fewer vendors working for you. The law of supply and demand will turn this new package into more money for your other recreational endeavors.

Analyze Your Fee Structure

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