The conventional wisdom is that minor-league hockey should be OK in a recession, as people seek out lower-cost entertainment close to home. Increased numbers of people attending movies in the past few months would certainly seem to bear that out, as well as better-than-expected revenues from the likes of McDonald’s. But so far the reality has been a little different this season, as attendance decreases have been the norm in most minor leagues. We look at what could shape up to be a rough offseason.The conventional wisdom is that minor-league hockey should be OK in a recession, as people seek out lower-cost entertainment close to home. Increased numbers of people attending movies in the past few months would certainly seem to bear that out, as well as better-than-expected revenues from the likes of McDonald’s.
But so far the reality has been a little different this season, as attendance decreases have been the norm in most minor leagues, save the ECHL, where attendance is up thanks to a strong showing from the Ontario Reign and the folding of four teams from the 2007-2008 season. Two ECHL (Fresno and Augusta) and one SPHL (Richmond) teams have folded in the midst of the season, and by the end of the day we could see another casualty in Bloomington, Ill. And we’re guessing there are more ECHL, SPHL, CHL and IHL teams on the brink than is being reported. (Only the AHL seems to be on solid ground these days; we’ll go into that league a little later.)
What gives? Attendance is down, but attendance is only one part of the financial equation for minor-league hockey teams; sponsorships and concession receipts are also huge parts of the equation. It’s not enough to get fans in the door; you need to pry some bucks out of their hands for a hot dog and a beer, and you need to convince sponsors to market toward the fans.
It’s the last part of the equation that has many in minor-league hockey worried. Sure, attendance ebbs and flows depending on the economy. But the real impact of the recession won’t be felt until the 2009-2010 season; this season’s sponsorships were sold months ago when the economy was in better shape, but next season’s sponsorships are sold now through the summer. Bad timing, to say the least.
In the AHL, things aren’t perceived as being calamitous – not yet, anyway. That league has a very high level of solid franchises – Hershey, Winnipeg, Wilkes-Barre/Scranton, Grand Rapids, Providence, Manchester – and there are very few poorly performing franchises to drag things down. Of the two that are underperforming, the Quad City Flames are all but certain to shift to Abbottsford, B.C. next season (they may need to kick in a travel subsidy, but the team is dying in Moline and parent Calgary would love a team out West), and there are signs of life with the Lowell Devils.
And, amazingly, there’s demand for an AHL franchise. There are 29 teams currently playing, with one held by the Edmonton Oilers (who ain’t selling). The Dallas Stars have already made a commitment to Austin, Texas for a new arena and AHL franchise. And cities like Glens Falls continue to seek a team. Former trouble spots like Iowa, Lake Erie and Peoria have made some significant comebacks. With the new owner of the Philadelphia Phantoms continuing to work on a Lehigh Valley arena, the number of available franchises is lower than it’s been in recent years.
But the AHL is swimming against the tide of minor-league hockey. And when seasons end in April and May, it will be interesting to see what owners decided to fold shop in the face of the bad economy.