Super 14 evaluation
The next step in the process to select the location for a fourth Australian Super Rugby team has begun with Melbourne and Perth today invited to submit their credentials to the Australian Rugby Union (ARU).
Following ARU Board sign-off, invitations have been issued to the Western Australian and Victorian Rugby Unions to make submissions following an extensive location evaluation process.
The two locations finished well ahead of others considered as potential sites, including Gosford, the Gold Coast, Townsville and Adelaide.
An ARU Evaluation team has spent the past two months developing a scorecard on a range of locations, examining high performance, commercial and development criteria, including the impact an additional team may have on franchises that currently field Super 12 teams.
The invited Unions have been issued with an Information Memorandum that details the ARU's requirements and other information that will assist each Union in making its submission.
All submissions must be received by the ARU by 5.00pm Friday November 19, 2004.
The Information Memorandum specifies requirements including detailed models and analysis on revenue streams, expenditure, sponsorship, ticketing, marketing and communications planning, as well as Rugby operations planning including recruitment, staffing (including coaching staff), training facilities and player welfare programs.
Other considerations include organizational structures, event and venue operations, community Rugby and development programs.
ARU Managing Director Gary Flowers says he expects excellent submissions from both locations.
"We will work with each body to provide the information and answers to assist them to put their best foot forward. There is no question the quality of the submissions will determine the outcome, as both locations scored highly across the range of criteria we used in our location analysis."
"The Board is conscious of disappointment in areas not selected to make submission, but the reality is that we now have two excellent options and can ultimately only choose one. To put other locations to the expense and rigors of a submission process would create false expectations and frankly, we would be wasting their time.
Mr Flowers says after the submissions are lodged on November 19th, the ARU would conduct a detailed bid evaluation and due diligence process in order to reach a decision on the successful location in December.
"Timing is critical. We need a C.E.O. and coach appointed quickly to get the right structures in place and competitive playing roster recruited.
Frequently Asked Questions
How did the ARU select the locations to be invited to make submission?
Six locations were selected for a "scorecard" analysis that was underpinned by the ARU's three specific objectives in establishing a fourth Super Rugby team. These are:
- Growing the elite player base of Australian Rugby
- Increasing the mass entertainment audience for and commercial value of Australian Rugby
- Rugby development through increased participation
All ARU business units and independent consultants MI examined how each location measured up on each of the objectives. The locations were Adelaide, Gold Coast, Gosford, Melbourne, Perth and Townsville.
Each objective received a different weighting. Out of each objective flowed a range of contributing elements, each of which carried an individual weighting.
Each city was given a score across the range of elements producing an overall scorecard for each city on each objective. This scorecard was then adjusted to reflect the weighting of each objective.
An example of this "decision tree" process: Under elite player performance (Objective one) would be the element of ease of travel from the players home bases, which is further broken down into sub elements of travel time, travel cost and frequency of travel.
No individual location ranked highest in all three of the objectives, however Perth and Melbourne each scored "wins" against the objectives and overall they finished significantly ahead on the scorecard over Gosford, the Gold Coast, Townsville and Adelaide.
What were the "elements" considered by the ARU in the "scorecard"?
Under elite player development, the review team considered issues such as travel time & costs, player wear and tear, training facilities, salary costs and a range of issues that affect the strength of the team and the potential of the players to play for the Wallabies.
On the mass entertainment and commercial side, the potential for commercial revenues from a range of sources was considered, along with the ability to build profile, enhance broadcast coverage and provide a quality venue. This evaluation also considered the impact an additional team might have on existing Super 12 franchises.
With regard to participation growth, the geographical growth of the game was considered along with the potential to grow player numbers and the potential for existing rugby clubs to lose sponsorship opportunities.
What is the process to select the best of the three invited locations?
Each location must make submission to the ARU by November 19th. The Information Memorandum explains to each party what is required and the ARU will be available to discuss or clarify anything contained in the Memorandum.
Once the submissions are received, the ARU bid evaluation team will begin its process. This will include a risk analysis and due diligence undertakings. A recommendation will be made to the ARU Board which meets in December to decide on the new location.
The ARU Evaluation team consists of senior ARU Management across a range of business units, independent consultants MI and a special sports consultant in Bob Elphinston OAM, who has long standing sports administration credentials, including being a member of IOC Evaluation Commission for the selection of the 2008 host city.
What are the criteria?
Financial
Both submissions must contain detailed plans that should include a comprehensive financial model and analysis.
This should include projections on revenue streams from sources such as ticketing, sponsorship, hospitality, membership programs, government support and licensing programs.
On the expenditure side, team salaries, football operations costs, administration salaries, costs of associated or feeder teams, sponsorship servicing costs, match day and stadium costs, IT platforms, administration costs, marketing, PR and other program costs.
All financial budgeting an analysis should be provided for a six-year period (2005-2010).
Commercial and Marketing
A sponsorship plan including revenues and a proposed portfolio structure - including naming rights, apparel, drink, hotel and other corporate sponsors.
A ticketing plan including historical attendance figures, catchment area and population, expatriate populations, access to club members, competition with other sports and entertainment products and proposed ticketing arrangements with stadia and/or ticketing agencies.
Marketing & Media
Market analysis
Brand positioning
Historical perspective on mass entertainment sport in each market
Competitor analysis
What products will be offered
High level marketing strategies
Sales projections by category
Media and Community relations programs
Rugby Operations
Squad and staffing structure
Timelines
Succession planning
Training facilities
Player Welfare programs
What involvement will the ARU have with the new location?
The ARU will be involved in the establishment and operation of the 4th Super Rugby team at least for an initial period. A separate management team will be established to manage the fourth team and the associated business.
The ARU will appoint the majority of the Management Committee whose role will include the appointment of the CEO, key management and coaching staff.
Over time, as the fourth team becomes established, the ARU's role will decrease.
What are the Key Dates?
Tuesday October 12th, 2004 Invitations to submit bids
Friday November 19th, 2004 Closing date for submissions
TBA December, 2004 Announcement of location
