44 Nonprofit & Voluntary Sector Q. 5 (2015)

handle is hein.journals/npvolsq44 and id is 1 raw text is: 

Article

                                                       Nonprofit and Voluntary Sector Quarterly
                                                                    2015, Vol. 44(l) 5-24
Revenue          Volatility       in                               @ The Author(s) 2013
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                                                           DOI: 10.1177/0899764013499072
Sports Clubs                                                           nvsq.sagepub.com
                                                                         OSAGE


Pamela Wicker', Neil Longley2, and Christoph Breuer'




Abstract
Revenue   volatility hinders the planning  within nonprofit  organizations, and  as
a consequence,   it can influence the organization's contribution to public welfare.
To  analyze the extent of revenue  volatility and its determinants, this paper uses a
comprehensive,   longitudinal, data set of German nonprofit sports clubs (n = 724).
It distinguishes between systematic volatility and club-specific volatility, and argues
that a complete  understanding of the sources and impacts of volatility requires one
to clearly distinguish between the two  components.  Empirical results indicate that
revenue  diversification can significantly reduce club-specific volatility, but has more
minimal benefits for lowering systematic volatility. It also reveals that clubs that rely
more   heavily on membership  fees, and less on subsidies, appear to have  reduced
levels of systematic and club-specific volatility, with the impact being much greater
for the latter.


Keywords
nonprofit sports organization, revenue volatility, sports club, financial risk, financial
resources


Introduction

For all nonprofit organizations, financial viability is critical for success, and is an
important prerequisite if the organization is to fulfill its broader mission (Young,
2007). A key aspect of financial viability relates to revenue flows-in the most basic
sense, an organization's revenues must meet or exceed its expenses in order for it to
survive in the long run. In this context, several studies examined the nature of revenue

'German Sport University Cologne, Germany
2University of Massachusetts Amherst, USA
Corresponding Author:
Pamela Wicker, Department of Sport Economics and Sport Management, German Sport University
Cologne, Am Sportpark Muengersdorf 6, Cologne 50933, Germany.
Email: p.wicker@dshs-koeln.de

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