The Business of Sports: African-Americans step up as players in the operations behind the games
Sports fans attending a game, watching one on television, listening to a radio announcer’s play-by-play relay, or reading about one in the newspapers, usually have no clue what takes place behind the scenes to make that sporting event happen. Behind the scenes is an endless flurry of business activity, from contract negotiations between a player’s agent and team owners, to stadium concession allotments and contract-letting for office equipment and building maintenance services.
The presence of African-Americans on this business side of the multibillion-dollar sports industry is growing. Black entrepreneurs provide essential supplies and services in the construction of stadiums and sporting facilities, including plumbing, electrical work and maintenance and cleaning. They are team owners, marketing and promotion specialists, agent representatives, sponsorship negotiators and providers of specialty services such as gift baskets and office supplies.
The scenario was much different in the past, when African-American companies may have had only a small part of a subcontract or were locked out completely from the bidding process, says Wendy Lewis, senior vice president of diversity and strategic alliances for Major League Baseball, Office of the Commissioner. Lewis, who began her MLB career in human resources with the Chicago White Sox, says African-Americans were locked out not because of race but because they were unknown as competitors. Today, with supplier diversity programs like the Diverse Business Partners Program she initiated at MLB, an electrical supply company, for example, now has access to contracts and subcontracts and is positioned to satisfy the demands of requests for proposals.
MLB encourages African-Americans to familiarize themselves with its Web site and learn how to supply the various goods and services the organization seeks. “To get a contract with MLB, a person needs to do their homework thoroughly and be prepared. They need to know the business not just from what is seen on television but operationally,” Lewis says. “A person wanting to do business with MLB needs to understand and know the baseball schedule and calendar and [needs to] keep up with the clubs and teams.”
MLB issues thousands of one-time, multipurpose or multiuse contracts, with nearly $500 million worth of such contracts awarded to African-Americans since 1998, or $50 million a year on average, she says. A contract with MLB can be lucrative because of that organization’s global brand and can be leveraged for spin-off contracts within the same organization or with others.
For example, through participation in MLB’s Diverse Business Partners Program, Robinson Graphics Inc., a New York City firm, has expanded its business with MLB to become the official printer of the entire baseball schedule. “I also do the lineup cards and whatever books they do. Before that I used to do the schedules and calendars for the Mets and the Yankees, even the National Basketball Association,” says Edward Robinson, the company’s owner.
In 2003, when the Chicago White Sox hosted the All-Star Game in the Windy City, local entrepreneur Debra Harris, proprietor of Especially 4 You Gift Baskets, heard of a call for gift-basket suppliers. She applied and was awarded the contract. She hopes to get the contract to supply gift baskets for the 2008 New York All-Star Game, but, says Lewis, MLB encourages local businesses to apply for such seasonal or event-based work.
Not all supplier relationships are successful. One company won a MLB contract for a particular commodity for an All-Star Game, but pulled out because its approach to the contract was so steeped in a sense of entitlement that it strained the partnership, Lewis says.
In another example, a company came to MLB with a good track record and excellent recommendations. It promoted itself as a national company, but pulled out because someone in the owner’s family was seriously ill. “What amazed me is that there was no one at the company to pick up the slack and continue with the contract,” Lewis says. “We tell people not to take us for a ride. If a person has bitten off more than they can chew, they should bow out because if they fail they would end up taking a lot of people down with them.”
Owners, managers, agents
When it comes to ownership and management at major sports teams and clubs, African-Americans are poorly represented in decision making and policymaking and managing day-to-day operations. In the National Football League, for example, Blacks are noticeably absent as owners. Among the 30 National Basketball Association teams, Robert Johnson owns the Charlotte Bobcats and, with former NBA star Michael Jordan as general manager, is involved in the team’s day-to-day operations. NBA star Ervin “Magic” Johnson is part owner of the Los Angeles Lakers. Steven Mills is president of Sports Teams Operations, MSG and also is heavily involved in the New York Knicks operations.
Among the 14 Women’s National Basketball Association teams, Sheila Johnson, ex-wife of Robert Johnson, is part owner of the Washington Mystics and is involved in decision making with respect to players and the overall direction of the team. At MLB, Hall of Famer Hank Aaron is senior vice president of the Atlanta Braves and Jimmie Lee Solomon is executive vice president of baseball operations. Of the 30 MLB teams, Ken Williams, general manager of the Chicago White Sox, is one of few African-Americans with direct operational involvement in the team.
“African-Americans with businesses in sports numbered twenty percent about twenty years ago. Today, from a global perspective, the number is about sixty percent and we have seen the numbers grow in all sports disciplines and for both sexes,” says Curtis Symonds, founder and owner of Hoop Magic Sports Academy, a multiservice gym facility in Chantilly, Va.
Symonds, a former chief operating officer for the Washington Mystics, a WNBA team, says the numbers are growing partly because Black athletes realize they will not be able to compete for the rest of their lives and are providing their own post-retirement security. More Black-owned sports businesses also are coming on stream as the leagues increase their recruitment of African-Americans from Black colleges and turn to African-Americans for customer service, sales, marketing, public relations, human resources and operations.
A startling development, Symonds says, is the sudden growth of African-Americans as sports agents, even though the number is still small. “What is happening is that players are beginning to trust Black agents more, which is an education in itself, on a daily basis,” he says. Previously, players, white and Black, were unaccustomed to dealing with Black agents, preferring to negotiate contracts with a white agent. A Black player would trust another Black to represent him only if they knew each other before — perhaps they grew up together — and the Black agent had earned a law degree. Despite the players’ evolving trust in them, Black agents still have to prove themselves by securing the best contracts and the best deals.
Today, African-Americans with the education, industry knowledge and experience in the corporate environment and who are courageous enough to step out on their own are qualified to represent any player, says Richard Gant, founder and owner of R. L. Gant, a sports entertainment and marketing firm that negotiates sponsorship contracts for athletes. “There is no reason why an African-American athlete or his or her parents should not strongly consider being represented by an African-American firm. There could be no excuse to suggest going to another firm based on experience,” he says.
Younger athletes are hiring African-Americans to represent them and they themselves are starting firms to represent themselves, Gant says. He cited the example of Lebron James, forward for the Cleveland Cavaliers, a NBA team, who negotiated his sizeable contract with a non-African-American, but has since started his own firm to represent himself.