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Javier Palenque

Javier is a Global business consultant based in Miami, with an MBA from Boston University and Executive studies at

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Northwestern Business School. Global expertise in supply chains, distribution, foreign markets, family businesses, and business transformations. A D3 player when young, Javier has been involved in tennis for all his life.
An avid photographer and a defacto tennis coach, he writes articles often trying to influence the direction of tennis in the USA. His mantra is to make sure tennis is accessible for all who want to play, regardless of income level.

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How can this be USTA?

By Javier Palenque

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Earlier in the week, I received the Tennis Industry United report in which the USTA proudly reports that through no programming, no investments, no ideas on how to grow the game, no brilliant hires but through the century’s deadliest pandemic the game had grown 22% in areas where the USTA never invests (parks). According to them an increase of 17% in adult players and an incredible 37% in youth players. If anything this tells me that of course increase in play has to take place in parks as they are underutilized and are free. 

 

For the past 3.5 years, I have been asking for investments in this particular area to provide the opportunity for all kids to play our wonderful sport. Now, of course with the pandemic, it would have been great to have programs in place to actually capture the wave of potential players coming into the game and not be late to this once-in-a-lifetime situation. This is called management myopia. That failure is what happens when company leaders define their mission too narrowly. It is a form of business nearsightedness whereby companies focus on selling products and services, rather than seeing the “big picture” of what consumers really want.

However, that is not the main reason why I chose to wake up early and write a few lines. The reason I did this is to look closely at one metric given by the USTA and ask yourself, how can this be? The metric is ball sales. The USTA claims in the above-mentioned report that ball sales for 2020 were up a mere 2% to 106.8M balls sold. This means that in 2019 the number of balls sold was (see 2019 report) 103.6M balls, however, that report includes   4.4 M Green, orange, and red balls. Hmm, so if we include only the yellow balls 103.6M  x 2% increase we get 105.6 M balls. Yet USTA claims 106.8 M balls sold, somewhere we lost 1.3M balls? If you include all balls from their own report then you have to add 103.6 + 4.4M for a total of 108M balls sold. So, if we compare 2020 results 106.8M balls sold vs the 108M balls sold then sales decreased by 2%.

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OK, so at best the number is questionable.

So, if participation is up 22% and playing occasions is also up 28% to a grand 495.1M occasions. This means that in 2019 the total number of playing occasions was 387M. So, USTA claims that the 2020 increase of187M playing occasions all it needed was a mere 2% more balls sold increase and the demand was fulfilled? What? You mean to tell me that in 2019, 103.6M balls are used in 387M playing occasions ( usage rate 387M/103.6M=3.7 ratio and the next year (2020) all you need are 106.8M balls for 495.1 M occasions? (usage rate 495.1M/106.8M =4.63 ratio). Now we compare ratios 3.7 /4.63 = 79% a miserable 2% increase in ball sales, creates more playing occasions at a ratio of 79%. If you are not good at math this ratio would have to be at least 100% to make sense. This is beyond absurd.

If the math above is confusing just consider this: the amount of playing occasions increase between 2019 and 2020 is 187M. Now compare that to the amount of playing in 2019 of 387M. In other words, USTA says in writing that (187M/387M = 48% ), a 48% increase in playing occasions only needed a 2% increase in ball sales. This is blatantly false. I wonder who approves this false information dissemination and with what purpose?

To conclude, these numbers are of course mathematically impossible,
not believable and not serious.

If in those 187M occasions they played with 1 new ball, you would have an increase in sales of 187M balls. Remember in the summer how people played with their own tennis balls to not touch the other person's tennis balls? Then it's logical to infer we would have more sales, in fact, double the sales for the same playing occasions. Do you not agree? If it's still not clear, let me rephrase the nonsense USTA claims, an increase of 6M new players who somehow had brand new balls in their attic somewhere? or decided to play with old balls hidden somewhere? This is ludicrous to any serious shareholder or business person or parent. Ever wonder why the numbers make no sense? Is it to hide something? And if it is what is it? Competence, brilliance, intelligence, or the opposite? This display of arrogance is approved by who? What is worse it is printed and circulated and who is accountable for this atrocity?

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Now let's use their own 22% increase in participation figure and do a simple elementary school analysis of it. If youth participation increased as they claim 37% to 6.4 M, that means that in 2019 4.6 million kids played the sport. It would be nice to have an actual breakdown of this number by age, gender, and zip code. The USTA will not provide such data. So the next best thing we can do is compare this 4.6M with the amount of USTA registered youth tennis players. This number is 100K with a 75% attrition rate by age 14. So, let's take the 100K kids that have USTA memberships and the 250K high school kids that play and do not have USTA membership. All we have is a pathetic 350K out of 4.6M or a weak 7% of all kids. I wonder where 

all these players play if it is not in parks, clubs, high schools, or USTA events? So it's clear USTA misses 93% or more of the kids it claims we have. Can you imagine a business that caters to only 7% of the market? That would be a failure under any management structure. How is this approved by the board of directors and the Chairman of the board? Someone, please explain it to us. Hiding does not mean the issue goes away.

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The conclusion is that these figures are questionable at best, deceptive, arrogant, and with no accountability.

 

You would think the Chairman of the board would be cutting heads just about now, but no? Nothing happens?Next, let us look at both of these numbers together with a 22% increased participation, and 187M new playing occasions, yet all these playing times needed only 2% more tennis balls. This not only does not make sense but it is not quantifiably possible. Imagine you run a Baskin Robbins somewhere and traffic increases 28% and you get 22% more clients, yet you only order 2% more ice cream for the demand? 1) either you stored 22% of ice cream in the back room, not likely or 2) The 22% of people that come in, only watch what others eat. In either case, it makes no sense.

I think that all the leaders of Tennis Industry United must explain the numbers well, sign their names under any document that they send, and clarify how the numbers simply do not add up. If they are hiding information, the logical question is with what purpose?

As tennis parents, coaches, cities, clubs, parks we deserve better. We deserve transparency and integrity in the information given to us. It is the right thing to do in business, in any kind of business.

I say let us focus on growing the game with integrity, competence, and transparency. In my book that is not asking for much.

I can be reached @ jpalenque@yahoo.com

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