PSL News

The Economic Advantage of Pakistan Hosting the PSL

The Pakistan Super League (PSL) has financially advantage of the Pakistan Cricket Board (PCB), the broadcasters are smiling and the fans are ecstatic about it. As for the franchises, some are still wondering when they are going to break even, however, others are occupied throughout the year in their brand building.

The key attraction is the presence of the big name and the T20 format. While Test cricket tests the temperament and strength of cricketers, T20 has its own group of fans following being the shorter format of the game. The fourth season has just begun with matches being paid in the United Arab Emirates (UAE) where stands are almost fully occupied in every match so far.

The PSL is a 10 year project where one should not expect profits in the first year. In the first edition of the PSL, three out of the five franchises made profits. As per an estimate, the PCB earns around Rs 2.5 billion in revenue through its flagship event.

According to economic experts, the PSL will aid in boosting the country’s weak economy by generating money and bringing sports tourism in Pakistan.

As per sources, billions of rupees will be circulated during the event and the government will profit by millions. Businesses of sports, hotels, restaurants, the textile industry, airlines, and advertisements will profit with the arrival of players and thousands of cricket fans. This economic rise will also help to revise the cottage industry.

Most importantly, the government generates profits from ticket selling and food is a major attraction for both tourists and fans. The textile industry profits from the increased production of shirts, caps and other garments. This also leads to a source of income for those who have the opportunity to sell these products during the campaign.

Around 60% of the PSL’s revenue is from sponsorships and around 70% of this is reserved for the PCB whereas 30% is distributed to the franchises.

Presently, the PSL broadcasting deal works out to millions of dollars. As per the agreements between the PCB and the team owners, most of the revenue will go to the franchises. Every team has its own set of sponsors and their dedicated sponsorships play a vital role in generating revenue for team owners.

It has also been identified that each team requires its sponsors more crucially than originally anticipated. Teams with smaller revenues struggle to gain sponsorships even at discounted rates.

Their ability to earn sponsorships not only depends on league performance, but also the talent they generate or possess and importantly the locations at which their matches are held.

Moreover, every PSL franchise sells merchandise which includes the selling of t-shirts, caps and other accessories. The success of the PSL will encourage and lay the foundation for various other sporting leagues across the country. These include national-level non-cricket leagues in hockey, football, and others.

While such leagues will gain popularity, a few of them will be fizzled out because of instability in sponsorship revenues, poorly set up business models and inadequate public appeal. It is expected, however, that the PSL will continue to thrive, leading the way for other sporting leagues in Pakistan.

Written by: Aqil

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