Dear Comrades Marathon Runner,
Much has transpired in the six weeks since I last addressed you on 6 April regarding the then- uncertainty as to the status of the 2020 Comrades Marathon, since which the race was initially postponed on 17 April, and last week regrettably cancelled.
I wish to again reiterate, as per my previous message, that CMA’s number one priority is to safeguard the health, safety and welfare of our runners, staff, volunteers, sponsors, stakeholders, fellow South Africans, and to the best possible extent the world, to which end I can confidently add that we are unequivocally supported by Athletics South Africa (ASA) and KwaZulu-Natal Athletics (KZNA).
Our number two priority at this stage is to endeavour to sustain this beloved, 99-year-old, iconic, national institution of a race, that is part of our national heritage, and which is so symbolically and economically critical to the sport of athletics in KZN and South Africa, for the next 99 years.
I was initially taken aback by the malevolence of some of the criticism aimed at CMA in the few days following our announcement of the cancellation. On reflection however, we were perhaps presumptuous to have anticipated runners’ respect and trust in our judgement and responsibility to make decisions in the best interests of the race.
There is a limit to how much information you can put into a media release, but it is abundantly clear that we did not provide enough information. So, I would like to do so now, and this is going to be very long and complex story – as it is a very long and complex race, and I ask you to bear with me.
Before explaining some of the rationale behind the decisions we announced last week, at the outset I would like to dispel any possible misconception that the CMA is either wealthy, profit-driven or motivated by the accumulation of wealth, which could not be further from the truth.
For starters, CMA is registered with the South African Revenue Service as a Public Benefit Organisation, as well as being registered as a Non-Profit Organisation in accordance with the Non-Profit Organisation Act No 71 of 1997, in terms of which it is defined as an organisation that is not set up for the profit of its members, but for the benefit of the public. The Act requires that any surplus of the organisation be re-invested and used for the purpose of attaining the main goal of the organisation and may not in any manner be distributed to its members.
The CMA is controlled by an elected Board consisting of 9 individuals, comprised of lawyers, an accountant, engineer, entrepreneur, civil servant, member of provincial parliament as well as marketing, sports administration and project management experience, all of whom serve in a 100% voluntary capacity for no remuneration whatsoever. Collectively they have completed 85 Comrades Marathons, four of whom remain active runners, and all of whom are passionately dedicated to ethically, efficiently and effectively furthering the Vision of the Comrades Marathon Association which is to stage the biggest and best ultramarathon in the world and the most inclusive sporting event in South Africa, which by extension means keeping our entry fees to South African athletes as low as we possibly can.
CMA in turn employs a staff contingent on a full-time basis, because that is what it takes to stage a world-class event of this magnitude – it is not your average weekend race. We have a general manager, race director, marketing manager, accountant, media officer, IT co-ordinator, procurement officer, museum curator and other support staff. They all realise that no one will ever become rich by working for Comrades, but nonetheless they are passionate about their jobs, energetic, hard-working, loyal and totally committed to CMA’s values and driving philosophy of putting our Runners First.
With regard to CMA’s financial situation, prior to March 2020 and the onslaught of the Covid-19 pandemic, I would have confidently described CMA as being comfortably solvent, in other words having assets in excess of its liabilities and being able to pay its obligations.
After having endured the past few years’ tough economic environment, during which we have consistently kept entry fees as low as we possibly could, through tight financial controls and belt-tightening exercises bordering on austerity, last year we managed to produce a modest surplus of R753,000, clawing our way back after two years net deficit of R3,3million. As we are a public benefit organisation this is not confidential information and is freely available in our audited financial statements.
So, we began this year with a seemingly healthy contingency reserve which had been gradually accumulated over a period of two decades and having attracted a record field of entrants for the 2020 race.
On the sponsorship front, apart from existing contracts with several long-standing sponsors, we announced one new major sponsorship in January, and were on the verge of signing and announcing other sponsorship deals, as well as a ground-breaking joint venture, at the beginning of March when the coronavirus struck.
It costs approximately R42million to stage the Comrades Marathon, not counting product in kind and logistics which are provided by companies such as Coca-Cola and Thirsti and a vast and expensive array of medical and emergency services and facilities provided by Netcare, as well as other lesser products and services which are either sponsored or subsidized, ranging from scaffolding to bananas.
The two major sources of income by which the Comrades Marathon is funded are sponsorship and entry fees, with the balance made up to a lesser degree by licensing, royalties, merchandising and interest earned on investments.
On the issue of Substitutions, I would like to clarify that we had continued to process substitution applications after the Covid-19 lockdown due to the fact that the dates for the 2020 Comrades Marathon substitution period were announced on 2 October 2019 at the launch of the 2020 Comrades Marathon, and were listed on its entry form and webpage, while in the interim since closure of entries in responding to numerous queries from disappointed runners they were advised to avail themselves over the substitution period.
It was an unfortunate coincidence that could never have been foreseen that the substitution period which had been cast in stone in October 2019 happened to coincide with the onslaught of Covid-19. CMA did nothing to actively entice runners to take up substitutions and it was simply a facility which was available and to which 485 runners willingly chose to avail themselves. There is perhaps a false perception that CMA derives income from substitutions, which it does not. It is simply a matter of an entry which one runner gives up, which is transferred to another runner who wishes to take it up. The 2nd runner pays the entry fee plus a nominal R200 administration fee, and the 1st runner receives a refund on his entry, also minus a nominal administration fee to cover the direct costs involved.
Our projected sponsorship income for 2020 was just under R20million, over half of which had already been received by mid-March, while our total entry fees received for 2020 was R20,2million, made up of approximately R13,6million South African entries at R600 each and the balance of R6,6million comprised of some Rest of Africa entries at R1500, but mainly Foreign entries at R3800.
So, there we sat as the CMA Board and Management in the second week of March, nine months into our planning, purchasing and preparations for the 2020 Comrades Marathon, when we were first confronted by the uncertainties pertaining to the coronavirus.
That is nine months of paying salaries, rates and other overheads and having incurred consulting fees, marketing and advertising expenses, IT services, commissions, deposits on venues, etc. as well as having already manufactured and/or taken delivery of many of our most expensive items of expenditure including the race t-shirts, runners caps, goody bags, paper for printing of our souvenir brochure, material for our route marker boards and having already staged our popular Comrades Marathon Roadshows around the country. This is not whinging, it is reality.
Although at that stage (16 March) we thought it would be premature to postpone or cancel the race, we did however decide to place a hold on tenders for production of race medals and the minting of gold medals, cancel our Novice and Women’s Seminars and, as we had not even begun to place orders for more perishable items, all other items of direct race expenditure were placed on indefinite hold, while in the meantime continuing to incur our other monthly administrative overheads and salaries.
It must be said here that while CMA had just three months warning of possible postponement, Two Oceans must have been in an even worse position with just four weeks’ notice of complete cancellation. Our hearts bleed for Two Oceans.
The next development which occurred was the announcement one month later on 17 April of the indefinite postponement of the 2020 Comrades Marathon, owing mainly to the effects of the prolonged National Lockdown, at which stage the CMA Board and Management began to seriously consider the potential ramifications of outright cancellation.
At about the same time it became apparent that in the event of cancellation we would be compelled to either write off completely in the case of those sponsorships still outstanding, or in the case of sponsorship monies already received we would be compelled to issue refunds, on the grounds that we would not be in a position to fulfil our contractual obligations to deliver the rights and benefits to which sponsors were entitled in terms of their contracts.
To their credit and our most sincere gratitude we have been able to negotiate with our two major sponsors Bonitas and Mr Price to generously allow us to retain a portion of their sponsorships. The bottom line however is that of the R20m budgeted sponsorship income we had anticipated and upon which we proceeded for 9 months to plan, purchase and prepare to stage the race on 14 June, we anticipate that we will eventually be able to retain less than R4million.
So when we came to the regrettable decision on 8 May that we had no option but to cancel the race outright, we did so with the realisation that having rightfully lost our sponsorship income, and having already incurred 9 months of overheads and sitting with 2020 t-shirts and goody bags already purchased, we simply could not afford to refund entry fees to the value of R20,2million and sustain the race.
On 14 May as we jointly announced with ASA the decision to cancel, we also announced the manner in which we would deal with the entries, namely that South African athletes would receive their #Comrades2020 mrpsport runners T-shirt and goodie bag, as well as a Comrades badge and flash and that International entries would be given the opportunity to defer their entries to 2021 or 2022.
Many of our South African runners have queried the rationale behind the decision to handle them differently and are rightfully entitled to an explanation which is as follows:
As already stated by the time Covid-19 struck us, CMA had already incurred significant expenditure towards the 2020 Comrades Marathon, including having already manufactured t-shirts, goody bags and badges, all dated for 2020 which cannot be carried forward to Centenary Race next year. The value of these items exceeds the value of the R600 entry fee paid by South African athletes, and while not a perfect solution, we believe was at least a fair one.
On the other hand, the vast majority of our Foreign runners pay an entry fee of R3800, which is partly justified by certain benefits and facilities which are made available to them over the period of EXPO and on race day, but which we also utilise to cross-subsidize our South African entries enabling us to keep South African entry fees as low and accessible as possible to the majority of South Africans. Our rationale was that to send them a t-shirt, goody bag and badge would be an absurdly insufficient recompense for R3800.
As I stated early on in this letter there is a limit as to how much information one can put into a media release, but amongst the other considerations CMA intends taking forward, but cannot make promises we may not be able to keep because no one can predict what is going to happen with Covid-19, and when and if we will be permitted to assemble 27,500 runners shoulder-to-shoulder in front of the Pietermaritzburg City Hall in 13 month’s time, are CMA’s earnest intentions:
- To give first preference for entries to the 2021 Comrades Marathon Centenary Race to runners who have entered in 2020.
- To also offer substantially discounted entry fees for the 2021 Comrades Marathon Centenary Race to runners who have entered in 2020.
I reiterate that the above is our intention, but we cannot make promises in the event that for any reason we are required by law to restrict our numbers owing to social distancing. Who knows?
We will continue to communicate with our runners and sincerely hope that this long painful but transparent letter goes some way towards alleviating runners’ valid queries and dissatisfactions.
We are not perfect, but we are doing our best in a bad situation to sustain the race we so love for another 99 years, while also endeavouring to be as fair as we can to our runners.
In closing I wish to thank Bonitas and Mr Price for their generosity in allowing us to partially retain some of their sponsorship, as well as Toyota for their support.
I would also like to encourage all 2020 Comrades Marathon entrants to participate in our recently launched virtual race, Race the Comrades Legends on 14 June 2020. Entry is FREE to all South African runners who entered the 2020 Comrades Marathon, and you are encouraged to promote participation amongst your family and friends over any distance from 5km – 90km. To enter and obtain more information go to www.comrades.com.
Keep safe and God bless,
CHAIRPERSON: Comrades Marathon Association