Big Sandy Arena Beats March Projections, Otherwise Higher Deficit Than Previous Year ; Nearly 29,000 Patrons Brought Downtown by Arena

by Tony Rutherford , HNN Entertainment Editor
Big Sandy Arena Beats March Projections, Otherwise Higher Deficit Than Previous Year  ; Nearly 29,000 Patrons Brought Downtown by Arena

HUNTINGTON, WV (HNN) – Naysayers temporarily take a hike. The Big Sandy Superstore Arena (BSSA) brought 28,618 patrons to downtown in March 2011, with such attractions as the Harlem Globetrotters, World of Wheels Car Show, Magic Expo, Home and Garden Show, Blake Shelton, and Huntington Hammer.

The increase in patronage means that an economic multiplier for parking, restaurant spending, and other purchases is favorable impacting downtown.

“In the budget we presented to the City of Huntington for March 1-31, 2011, the City of Huntington was to subsidize the arena $38,057 with these financials, the arena is requesting $5,222.00,” said Brian Sipe, General Manager.

The report indicates that during the current fiscal year 147,880 patrons have attended events at the center. Although the attendance is down from 2010 when it was 175,266, paid attendance is $8,079 ahead of projections, Sipe wrote.

But, overall, the recession which brought less attendance than expected along with less food /beverage and catering revenue, which means the BSSA faces the possibility of a significant subsidy increase, unless events scheduled in the last quarter (April to June) make up for the deficit.

The hopeful projections with the three additional shows anticipate bringing down the loss to $220,985, which would be under the budget loss projection of $224,072. (About $3,000 less than budgeted.)

(Editor’s Note: Left unstated by the figures, the soaring gasoline hikes on attendance and whether scheduling three additional June shows would result in patron choices on which show or shows to attend.)

Based on projections by Sara Thur, Director of Finance, the BSSA would complete the fiscal year with a total loss of around $445,057, Sipe said.

That could mean a request for BSSA requesting more subsidy funds from the city than originally budgeted.

“The issue is not in the expenses… the issue is generating revenues which is why we confirmed three more shows for June. I have been meeting twice a week with our Marketing and Sales Manager so we can schedule meeting with various businesses for sponsorship revenue for the building,” Sipe explained. “We have increased our Food and Beverage costs by $0.25 on most items and have placed employees in the seating stands with food and beverage products to try and sell to the impulse buyer in the stands.”

He believes the economy has prevented people from attending as many events as hoped.

“When you look at events, we have them. When you look at ticket sales and ancillary revenues, we do not have them on some of our events. I believe the economy and lack of rise in the market have contributed greatly to this issue in our market and other markets all across the USA,” Sipe analyzed based on his own experience and reports from other SMG managed venues.

Since some concert and show promoters seek a smaller size venue, Sipe indicates a continuation of meeting representatives from the Keith Albee Performing Arts Center “to try and generate some revenue for shows that will not play the arena because of our size.”

Overall, Sipe believes “we can get there” concentrating on the four areas targeted for improvement.

The figures show that “we budgeted to make [in March] $94,307 and the actual income was $127,853. The YTD actual is -$311,517 and the budgeted amount is $-41,672, a difference of approximately $269,845.

Sipe indicated that since expenses exceed expectation , BSSA will “decrease the amount of part time hours worked to save on labor costs” and “watch our expenses.”

The spread sheet shows that service expenses take a hunk of the shortfall. They are at $786,188 which is more than the $398,755 budgeted. (At this time in the prior fiscal year, those expenses were $596,655.)

In addition, the data analysis shows revenues from rentals and catering have taken large dips from the prior year. Event income for the current year is just under $200,000, where $300,000 was budget and in the prior fiscal year to date $359,000 was received.

Concession sales have exceeded the previous year ($254,000 to $272,748) but catering is down sharply from the previous year and projections. Catering has generated just over $61,000 while last year at this time it was over $110,000. (The estimated budget was $121,801). Novelty sales increased to $66,879, exceeding the previous year’s $51,000 and besting budget projections by $11,000.