Printable View
I know that no one knows but I'm discussing this with my Yankee-lover friend.
The Yankees make A LOT of money.
The Yankees spend A LOT of money.
Everyone always says "every team wishes they had Steinbrenner as an owner". But is this true? Do we know that the Stenibrenners put a higher percentage of money back into the Yankees? Or are the Yankees the Yankees ($200 million payroll) just because they are the Yankees ($bizillion in revenue)?
I just assumed that they do, but I'm not sure. Interesting point, though.
I wonder if the ratio of profit to expense for the Yankees would be higher or lower when compared to, say, the Pirates. Something interesting to dig up.
from 2008
Code:Yankees: Revenue was 375,000,000
Payroll was 201,449,189
Angels Revenue was 212,000,000
Payroll was 113,709,000
Phillies Revenue was 216,000,000
Payroll was 113,004,046
Red Sox Revenue was 269,000,000
Payroll was 121,745,999
Dodgers Revenue was 241,000,000
Payroll was 100,414,592
Cubs Revenue was 239,000,000
Payroll was 134,809,000
Mets Revenue was 261,000,000
Payroll was 149,373,987
Yankees Payroll = $200 million
Pirates Payroll = $48 million
So, for the Yankees to 'reinvest' at a higher rate than the Pirates the Yankees would have to have revenue of roughly 4 times the Pirates.
That doesn't pass the smell test to me
HGM posted a link a while back that showed what percentage each team spends of their revenue on payroll.Quote:
Originally Posted by free2131
Yankees were one of, if not the highest, percentage, while teams like Minnesota, Pitt, San Diego, and even St. Louis were on the lower end.
I slightly remember that link. I'd like to see it again
I HIGHLY doubt that that revenue number for the Yankees includes ALL yankee related Revenue. Probably that's true of most teams
http://www.subtraction.com/2009/11/0...nkees-spendingQuote:
Originally Posted by Jeffy25
This.Quote:
Originally Posted by filihok
I wonder if the it also takes into account the revenue sharing.
I'm looking for the link, having a hard time digging it up.Quote:
Originally Posted by filihok
and of course there are other revenues for some teams....The Yankees for example own the YES network, the Cardinals own the local radio station and other things as well. But just gate revenue, that is what the link has.......i'll keep looking.
and now I see HGM re-shared it.
here it is
Many teams, and many owners usually have other investments that they earn income off of.....Most teams could probably double their on field payroll and probably could be fine....but that would of course kill their profits and wouldn't necessarily be a good choice.Quote:
Originally Posted by free2131
As long as the team is still making money, they should be investing all that they can to make their on field product as good as possible. Winning does bring in fans...and you aren't going to win without at least some payroll.
The thing is, other teams HAVE the money, but they do not spend it. There are some owners who are these raking in much more than Steinbrenner, but they are afraid to spend it.
Any proof?Quote:
Originally Posted by yanks27
I legitimately don't know if you are right or wrong.
I'd guess that you are wrong, but that's just a guess
I agree.Quote:
Originally Posted by filihok
but there is some level of proof.
When you rank the owners overall financial portfolio's Steinbrenner is one of the least rich, while the Twins Owner (recently died I think) was by far the wealthiest.
But that is because of other endeavors usually. The Twins owner owns a lot of things in Minnesota, not just the Twins. But with any business, the owner isn't going to spend more in one investment than what it earns. I don't care how rich you are, you don't want to lose money just so you can have a good baseball team, but someone like Steinbrenner might want to.
I imagine the Yankees profit margin annually isn't as high as some teams, although they keep increasing their revenue by winning more and more. The more you win, the more you can charge and the more people that are going to come see you play, buy merchandise etc.
Just like any business, you have to spend money to make money. You hire a GM to figure out what the best strategy on how that money should be spent.
I need to find the list of each owners portfolio's...but Steinbrenner isn't leading that list, and it isn't really that close....in fact the owner of the Marlins is one of the richest I believe as well. Steinbrenner owns some real estate, and of course, the Yankees, which are valued over 1 billion currently.
http://en.wikipedia.org/wiki/List_of...incipal_owners
you can at least select the owners and see their net worth if you want to.
Those "investment rates" are entirely meaningless. There are a ton of costs associated with running a major league team that aren't accounted for, and that, presumably, do not vary a great deal across teams. There are other costs that will vary significantly across teams, such as stadium costs or things like that. And as people have noted, the revenues are only a fraction of total revenue.
It is interesting to compare that to something like the NHL, where the salary cap is based around the players receiving 55-57% of league revenue every year, or basketball where the players receive 51% of league revenue. It looks to me like baseball is a long way from that level of compensation.
no offenseQuote:
Originally Posted by kenny1234
but duh
the table isn't talking about profitability....it shows what percentage of gate revenue is spent on payroll. It isn't in detail of how much a team makes, spends etc. it's a start to being able to answer fili's question...but we really don't know how much is actually spent in comparison to total revenue. Hell each team spend about 30 percent of their revenue in taxes alone, you start talking about vendor expenses, utilities, employees etc....the list is long. There are also a ton of revenue outlets that we don't really know, we can assume things like merchandise, food, beer, etc.
I'm going to say that, on average based upon total percentages..i'd bet they "reinvest into the team payroll" less than most teams. I just think they are a money making machine. Sure the total number spent on payroll is higher, but i'd bet its a smaller percentage of profit than most other teams spend.
ahemQuote:
Originally Posted by dickay
Granted this isn't based on profit
you hit the nail on the head right there. And I also question the listed revenue..if it includes all streams, not just for the Yanks but for all of them? Does the Yankees have any other "dba" they operate under that also brings in large revenue streams? Wouldn't be surprising at all.Quote:
Originally Posted by Jeffy25
Lets face it...I think team CFO's chuckle when they see these kind of public financials. I don't believe any are close to accurate. Nothing at all to base that on though.
it's gate revenue....and payroll.Quote:
Originally Posted by dickay
That's what we know, that's what the list is sharing. nothing more.
and did you read the rest of the thread? We already stated all of that.
That's fine, but then this list has nothing to do with the original question. When you post this, it appears to imply that the payroll advantage of the Yankees is not just because of revenue - that they spend a higher percentage of revenue as well. But without a bunch more information, that implication is simply misleading - and I was just trying to point that out.Quote:
Originally Posted by Jeffy25
i agree...thats why i was confused when he posted it for a second time in this thread after my initial post within this thread. Its really irrelevant to this..well, any discussion.Quote:
Originally Posted by kenny1234
how is it irrelevant? It gives you two pieces of information getting you closer to answering the question that was asked.Quote:
Originally Posted by dickay
Gate revenue in relation to payroll is a good way to start measuring how the Yankees spend their money.
because of everything already mentioned....gate revenue is a small piece of the whole equation and it alone can in no way answer the question. As Kenny said, its also misleading.Quote:
Originally Posted by Jeffy25
I suppose you could say its a "start", as you have. But its equivalent to me asking you to put a car engine together and giving you only page 135 of the instruction manual. ;)
Seeing how it's their largest form of revenue, it would be like asking me to build a car with all but page 135 of the manual.Quote:
Originally Posted by dickay
We are pretty aware of what the Yankees make each year, we can easily find it, the same can be said for each team in baseball. And we can pretty easily know how much they spend in payroll....so being able to answer fili's question is somewhat possible.
Hell Forbes puts out a report each year to make the research easier for us. The one I linked to is the one from like 02, you can probably find a more recent one pretty easily.
The Yankees do in fact reinvest more money than other teams, but they also have higher revenue than most teams. But on a percentage basis, they do routinely invest a higher rates than other ball clubs.
If you take the time to do simple research you can find a lot of articles sharing what the Yankees overall make, as well you can find out what Steinbrenner is worth. It isn't hard to find out the information, I do it for potential new clients, although some of my favorite sites to learn revenues for potential clients aren't going to have the Yankees on them.
what bothers me with this statement is how yankee fans use it to say that just because Owner A has more personal wealth than Steinbrennar, he should be spending more. They make this claim knowing full well that Owner A's overall wealth should have nothing to do with the teams finances. Steinbrennar is NOT dipping into his own wealth to finance that team....every dollar he spends is calculated to earn a return on his investment. If the MINN or FLA owner dips into his personal vault to finance a team, its very unlikely they will have the same opportunities for a return on that investment.Quote:
Originally Posted by yanks27
It seems every Yankee fan I know thinks the game is similar to Field of Dreams, except for the catch phrase is, "If you spend it, they will come". Its not apples to apples. The Minn or Fla or pretty much every other owner in the league cannot get the same return on their investment as NYY can. Part of that is the Yanks great history and world wide fan base and marketing over the past century. Its something no team can compete with.
felt like sharing overall worth and what percentage of ownershipQuote:
The Steinbrenner family's 85% interest in the parent company, Yankee Enterprise Global, which also owns stakes in the YES Network, Legends Hospitality Management and IMG-Legends, is worth $2.8 billion
i dunno...i looked at both your forbes links and neither was a "report". the second was an article discussing YES...and the first, well I can't recall at the moment but I didn't find it very helpful in answering the question.Quote:
Originally Posted by Jeffy25
There used to be a time when concessions were a larger take than ticket sales. With the Yankee ticket seat costs now I doubt thats still true lol. Regardless concessions are still a big piece. Marketing, investments, parking, merchandise, etc. are surely just a few ways the team adds revenue. I'm sure they find many creative ways to get money from their stadium...i'm sure the Yankees have many many more revenue streams.
Now revenue alone is not enough to answer this question either. Operating costs i'm sure vary significantly from team to team. You can't say for example that the Yankees pay 50% of their revenue in payroll and the Tigers only pay 40%, therefore the yankees reinvest alot mroe than the Tigers, because the Tigers may have alot more operating costs & expenses than the Yankees (or visa versa).
My point is, the question is alot more complicated than its being made out to be. As much as everyone would like to have it nice and simple...it just isn't and won't ever truly be known. We don't have nearly enough information.
For example, using your chart and making pretend that the revenue is in fact accurate for all revenue sources combined....the Pirates "reinvested" 34% into payroll whereas the Yankees "reinvested" 54% into payroll. If the Pirates expenses plus payroll pushed them to the break even point with their revenue, and the Yankees with their expenses STILL turned a profit of 100 Million....who's truly "reinvesting" a higher percentage? Its the Tigers.
whats funny, is one of the links you provided...a commenter detailed my concerns rather eloquently and provided a more accurate chart to use for comparisons. Here is his points, followed by the link;Quote:
Originally Posted by Jeffy25
he followed it up with;Quote:
Well, as is chronicled elsewhere on these boards, with the Yankees you also have to consider the profits from the YES Network (they don't get two bucks a subscriber for the Boston-New York Poker Showdown). And that adds in about $100MM or so in profits off of about $260MM in Revenues.
http://www.multichannel.com/article/CA6363941.html
Also, you have to be very careful how you use the #s because there's probably a fixed cost of I really don't know but would guess about $10MM just to run a franchise. To pay for the front office, the operations, the minor league clubs, and all that. Which would impact the lower-revenue clubs to a greater extent (as it would be a higher %age of their available Revenue). So really what you should consider is revenue as a portion of available income (and for the Yankees you'd have to reduce their revenue by their income-sharing # as well).
Now this link shows team valuations for the 2005 season. Now, of note is that the Yankees have gone up dramatically with their new stadium, whereas most teams now i'd venture have actually gone down with the economy woes. The Yankees aren't immune to the economic plight, and have taken a hit over what they WOULD be worth if not for...but they are still worth more than they were in 05.Quote:
Well, you would, except they don't exist.
Annual reports (and more importantly, the 10-K's) are only produced and publicly available for public companies, i.e. ones whose ownership is determined by publicly-traded stocks. Baseball franchises are privately owned. So they have annual results but they just get reported to the ownership group. Which is one of the reasons that owners and players fight so much on money. Because the players never really trust that they're seeing the entire picture (every once in a while, you'll hear players saying owners need to, "open their books" ... that's what they're talking about). So the best you can do is rely upon Google or Bloomberg or media reports for best estimates of revenue & profit.
Or, to be much more simple about it, you can just go by the estimated values of the franchises since that should theoretically represent the present discounted value of their profit streams.
http://www.forbes.com/lists/2006/33/Income_1.html
Steins have always invested wisely. They dont lose money. On YesNetwork alone they out earn most teams.
New stadium is municipal. They sold bonds for 50% and got NYC to pick up the other half. Then they charged 3x to their fans. End of year, they made a crap load of money. At least 100,000 old ladies in NY couldnt figure out why their cable went up by $2 and their taxes went up by $15. I am a Yanks fan, but they are scum on finances. They actually asked for a statewide tax to pay for the stadium they got for free. See what i mean?
http://www.pittsburghlive.com/x/pitt.../s_660477.html
Quote:
Coonelly [Pirates team president] provided limited data about what has been spent the past two years on player acquisition (via the draft and internationally) and development. The $11 million influx for baseball capital improvements included:
• Construction of an academy in the Dominican Republic for $5.4 million;
• Renovations to Pirate City, some of which were paid for by the city of Bradenton, Fla.;
• Equipment and facilities upgrades at PNC Park and Pirate City, such as the installation of ProBatter video pitch simulators;
• Purchasing a low Class A team and relocating it to Bradenton. The cost of that franchise was around $3 million.
Since 2007, when Coonelly was hired as part of a front-office overhaul, the Pirates have increased their budget for the draft by $8.3 million and upped their budget for international free-agent signings by $1.87 million. In that same span, the team has nearly doubled its domestic scouting staff (14 to 25) and increased its international scouting staff (19 to 33).