One thing COVID-19 has done is highlight financially struggling businesses. Although rugby is a sport the RFU have to operate as a financially viable business. This is where it gets more complicated because rugby has two forms; rugby 15s and rugby 7s both in effect being subdivisions of the rugby business in England. Rugby 15s is the traditional form of the game and attracts greater numbers whether that be players or crowds. As a consequence 85% of RFU revenue is generated by the 15 a side home game ticket sales.
Crowd for England 15s at Twickenham
How is the 7s program unprofitable?
I think the main reason rugby 7s is unable to be self sufficient is that it relies on the global tournament structure that they compete within. A structure where all teams tour around the world playing a mini tournament in each country competing. These mini tournaments generally last one weekend per location. This means that in a season a team will only get that weekend for generating ticket revenue. This would be fine if for that weekend Twickenham was sold out but the record has only been 54,000 of the 82,000 capacity.
Crowd for the HSBC 7s tournament at Twickenham
How does this relate to villains in rugby?
Through the current pandemic the RFU have been looking into their financials. After analysis a plan was implemented to keep the RFU afloat. The first stage of this was reducing the match day bonus of rugby 15s players by 25%. The second stage was to cut the 7s program putting their chances to qualify for the GB team up in the air. Obviously this has caused a division in opinions. Some people take the point of view that the 15s team sell out Twickenham on average of 7 times a year at a much higher ticket price so they should benefit because people are paying to see them play. However others believe that they are greedy and it should be a privilege to play for the national team therefore it shouldn’t be done for a match day bonus.
I personally think that the 15s team should get a match day bonus because they are putting their bodies on the line. However I do think that in these challenging economic times they should take a pay cut to help protect the RFU. Just because I think they deserve a bonus doesn’t mean I think 7s should be cut, however I do think that more needs to be done to allow the program to be self sufficient and financially viable.
References
https://www.theguardian.com/sport/2020/apr/01/rfu-cut-england-25000-match-fees-covid-19-rugby-union
Finances are also the biggest struggle for any sport franchise. Seeing as how the RFU is struggling financially to sustain itself, how do you propose they generate more revenue without having to cut back on the teams support or cutting teams entirely? Is it even possible for them to do so without cuts?
The RFU is a non-profit charity that reinvests all profit back into the grassroots community development side of the game, usually the RFU would be financially strong or at least in a much better position. Hoverer due to lockdown multiple national games have been canceled meaning the is currently very little revenue being generated. However when the 7s program does return as revenue increases I think its business model needs reevaluation to reduce the rick of the same situation occurring again.