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Int. J. Financial Stud. 2013, 1(4), 119-136; doi:10.3390/ijfs1040119

Organizational Mission and Revenue Diversification among Non-profit Sports Clubs

Department of Sport Economics and Sport Management, German Sport University Cologne, Am Sportpark Muengersdorf 6, Cologne 50933, Germany
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Received: 2 October 2013 / Revised: 31 October 2013 / Accepted: 4 November 2013 / Published: 8 November 2013
(This article belongs to the Special Issue Sports Finance)
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Abstract

The beneficial effects of diversified income portfolios are well documented in previous research on non-profit organizations. This study examines how different types of organizational missions affect the level of revenue diversification of organizations in one industry, a question that was neglected in previous research. Based on contingency theory, it is assumed that different missions are associated with different funding sources. Since missions can be complementary or conflicting, specific attention needs to be paid to the combination of missions. The sport sector is chosen as an empirical setting because non-profit sports clubs can have various missions while their overall purpose is promoting sport. Panel data from a nationwide survey of non-profit sports clubs in Germany are used for the analysis. The regression results show that revenue diversification is significantly determined by organizational mission. Historically, typical mission statements like promoting elite sport, tradition, conviviality, non-sport programs, and youth sport have a positive effect on revenue diversification, while clubs with a commercial orientation and a focus on leisure and health sport have more concentrated revenues. The findings have implications for club management in the sense that some missions are associated with higher financial risk and that the combination of missions should be chosen carefully.
Keywords: revenue diversification; income portfolio; organizational mission; contingency theory; non-profit organization; sports club revenue diversification; income portfolio; organizational mission; contingency theory; non-profit organization; sports club
This is an open access article distributed under the Creative Commons Attribution License (CC BY 3.0).

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MDPI and ACS Style

Wicker, P.; Feiler, S.; Breuer, C. Organizational Mission and Revenue Diversification among Non-profit Sports Clubs. Int. J. Financial Stud. 2013, 1, 119-136.

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Int. J. Financial Stud. EISSN 2227-7072 Published by MDPI AG, Basel, Switzerland RSS E-Mail Table of Contents Alert
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