Business impact of NHL canceling first two weeks of season

lakings.jpgThe L.A. Kings no doubt wanted to quickly capitalize on being Stanley Cup champions (TV ad revenues, sales of merchandise, etc.), so the cancellation of the first five games (four of them at home) is less than ideal. But from an economic standpoint, it's not a huge event, especially if the dispute is settled soon and the league can reschedule some or all of the games. Even during last season's lengthy NBA lockout, Staples operator AEG managed to make up most of the lost nights. From the LAT:

In the 124 days of the shortened NBA season -- which started on Christmas -- Staples is scheduled to host 127 events, said Lee Zeidman, general manager of Staples as well as Nokia Theatre and the L.A. Live complex adjacent to the venues. "From a financial standpoint, the arena has a good chance of hitting its original budget" before the lockout, Zeidman said Thursday. "The restaurants at L.A. Live also will get close to hitting their original projections." Because some days have more than one event, the arena still has nine empty days, but many of them are likely to be filled as the Los Angeles company continues to reach out to concert promoters and event managers, Zeidman said.

The biggest challenge is trying to replace the cancelled games at the last minute. Last year Staples managed to land a boxing match and additional concert performances by Katy Perry, Jay-Z, and Kanye West. But most bookings are made many months in advance. As for other impacts, AEG employs between 2,000 and 4,000 part-time workers for each event, so there's the possibility of lost wages. Add in the possibility of lost business at L.A. Live and other downtown venues. Most of that cannot be made up. Of course, it can work the other way - advancing deep into the playoffs means more games and more fans. Such are the vagaries of running a restaurant, souvenir stand, or arena.

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Mark Lacter
Mark Lacter created the LA Biz Observed blog in 2006. He posted until the day before his death on Nov. 13, 2013.
Mark Lacter, business writer and editor was 59
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