Some Grains of Salt
Welcome to our 2009 State of the Industry Report. This represents the third year running in which we base our report on a comprehensive survey of more than 2,000 directors, operators, managers and owners of recreation, sports and fitness facilities.
In last year's report, many of our survey respondents were already murmuring about the impact of the economic downturn—not yet officially called a recession at that point. This year, that murmur has turned to a roar, and our research definitely shows that the economic situation is having an impact on facilities across the country. But before you delve into this study, let me offer a few grains of salt.
First of all, while statistics are a helpful way of demonstrating trends, we have a tendency to believe in them as hard facts, without considering that the interpretation of numbers—like any other subjective endeavor—can take on a glass-half-full or a glass-half-empty approach, depending on the view of the interpreter.
Consider this example:
Research shows that 20 percent of respondents said they are eating fewer cookies in 2009, up from just 10 percent eating fewer cookies last year.
Looks like cookie consumption is down, doesn't it? But wait, now look at this:
While 20 percent of respondents are eating fewer cookies in 2009, up from just 10 percent eating fewer cookies last year, a full 60 percent of respondents have increased their cookie consumption, while 20 percent are consuming the same number of cookies.
This paints a different picture doesn't it? I'm giving you this example, not to send you to the cookie jar, but to illustrate that while you might find some of the numbers in these pages negative—more respondents this year than last are anticipating falling revenues, shrinking operating budgets and so on—the picture overall is not so bleak: The majority expect their revenues to hold steady or increase. And while a drop is expected in overall operating expenditures in 2009, they are expected to recover beginning in 2010.
A second grain of salt: Remember the moderating effect. Some facilities—and some regions—are still doing relatively well through the downturn, while others are faring worse. The numbers we report will naturally fall in between the extremes.
A third, and important, grain of salt: Consider the timing of our survey. The respondents to our survey answered these questions between Feb. 10 and March 2, 2009. According to The Conference Board Consumer Confidence Index, consumer confidence reached an all-time low in February and remained flat in March. After that, April and May saw considerable improvement. The all-time low of 25 in February was up to 54.9 by May—its highest level in eight months. This is just one economic indicator, but it does reveal something about people's attitudes. Confidence was at its lowest point as our respondents were answering our questions.
I offer these grains of salt not to rub them in your metaphorical wounds, but to give you a lens through which to view the information on these pages. Much of the media has a tendency to overstate the negative and understate the positive. We don't aim to join them, and therefore offer these happy bits of news: The majority of respondents to our survey saw their revenues increase or hold steady in 2008, and expect them to continue to hold steady or increase in 2009 and 2010. A majority of respondents are still planning construction projects—new facilities, additions or renovations—over the next three years. And while most respondents are concerned about the impact the economy will have on their facilities, that does not mean that they—and you—are incapable of adapting to the situation and coming out ahead in the end.
So with all this in mind, I invite you to turn the page and start learning about the state of the industry in 2009.
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