Reference no: EM131068167

Southwestern University (SWU), a large state college in Stephenville, Texas, 30 miles southwest of the Dallas/Fort Worth metroplex, enrolls close to 20,000 students. In a typical town-gown relationship, the school is a dominant force in the small city, with more students during fall and spring than permanent residents.

A longtime football powerhouse, SWU is a member of the Big Eleven conference and is usually in the top 20 in college football rankings. To bolster its chances of reaching the elusive and long-desired number-one ranking, in 2005 SWU hired the legendary Bo Pitterno as its head coach. Although the number-one ranking remained out of reach, attendance at the five Saturday home games each year increased. Prior to Pitterno's arrival, attendance generally averaged 25,000 to 29,000 per game. Season ticket sales bumped up by 10,000 just with the announcement of the new coach's arrival. Stephenville and SWU were ready to move to the big time!

The immediate issue facing SWU, however, was not NCAA ranking. It was capacity. The existing SWU stadium, built in 1953, has seating for 54,000 fans. The following table indicates attendance at each game for the past six years.

One of Pitterno's demands upon joining SWUhad been a stadium expansion, or possibly even a new stadium. With attendance increasing, SWU administrators began to face the issue head on. Pitterno had wanteddormitoriessolely for his atheletes in the stadium as additional feature of any expansion.

SWU's president Marty Starr, decidedit was time for his vice presidentof development to forecast when the existing stadium would "max-out". He also sought a revenue projection, assuming an average ticket price of $20in 2011 and a 5% increase each year in the future prices.

Southwestern University Football Game Attendance, 2005-2010

	2005		2006		2007
GAME	ATTENDEES	OPPONENT	ATTENDEES	OPPONENT	ATTENDEES	OPPONENT
1	34,200	Baylor	36,000	Oklahoma	35,900	TCU
2*	39,800	Texas	40,200	Nebraska	46,500	Texas Tech
3	38,200	LSU	39,100	UCLA	43,100	Alska
4**	26,900	Arkansas	25,300	Nevada	27,900	Arizona
5	35,100	USC	36,200	Ohio State	39,200	Rice
	2008		2009		2010
GAME	ATTENDEES	OPPONENT	ATTENDEES	OPPONENT	ATTENDEES	OPPONENT
1	41,900	Arkansas	42,500	Indiana	46,900	LSU
2*	46,100	Missouri	48,200	North Texas	50,100	Texas
3	43,900	Florida	44,200	Texas A&M	45,900	Prairie View A&M
4**	30,100	Miami	33,900	Southern	36,300	Montana
5	40,500	Duke	47,800	Oklahoma	49,900	Arizona State

D
iscussion Questions:

1. Develop a forecasting model, justify its selection over other techniques, and project attendance through 2012.

2. What revenues are to be expected in 2011 and 2012?

3. Discuss the school's options.