cusimano_brothers 1,655 Report post Posted December 2, 2011 From Toronto Star: ...Forbes says the average team value hit a record $240 million, while operating income fell 21 percent due to soaring player salaries. ... Forbes. Forbes. Share this post Link to post Share on other sites
cusimano_brothers 1,655 Report post Posted December 2, 2011 I can't help but wonder about this: How many of the 18 revenue-losing clubs might make money if they were in a different location? As many as one-third? 1 Rick D reacted to this Share this post Link to post Share on other sites
Doc Holliday 1,888 Report post Posted December 2, 2011 Could you imagine how much money the Wings could make if you had more than 700,000 people who actually lived in the city? Share this post Link to post Share on other sites
AceInTheSleeve 97 Report post Posted December 3, 2011 Hockey’s wealth gap is widening: 18 of the 30 teams are losing money That's what I call a failing business model. I thought the number of teams losing money was under 10, and that would be bad enough! Share this post Link to post Share on other sites
egroen 384 Report post Posted December 3, 2011 That's what I call a failing business model. I thought the number of teams losing money was under 10, and that would be bad enough! A lot of owners do not really look to make a yearly profit on sports teams. Share this post Link to post Share on other sites
AceInTheSleeve 97 Report post Posted December 3, 2011 A lot of owners do not really look to make a yearly profit on sports teams. I find this VERY hard to believe. Everyone looks to make profit. Nobody goes into a business planning to lose money, its simply not sustainable. Share this post Link to post Share on other sites
egroen 384 Report post Posted December 3, 2011 (edited) I find this VERY hard to believe. Everyone looks to make profit. Nobody goes into a business planning to lose money, its simply not sustainable. It's rare to find an owner whose main business is a sports team. For instance, do you really think Ilitch cares that much if he does not turn an annual profit? Most owners view a team as a long term investment and short term tax shelter & hobby. Edited December 3, 2011 by egroen Share this post Link to post Share on other sites
AceInTheSleeve 97 Report post Posted December 3, 2011 (edited) It's rare to find an owner whose main business is a sports team. For instance, do you really think Ilitch cares that much if he does not turn an annual profit? Most owners view a team as a long term investment and short term tax shelter & hobby. I can't say whether or not Ilitch cares if he makes money with the wings & tigers. I do think that it is foolish to not care about the health and profitability of your business. But then again maybe that's why the NHL needs a revenue sharing system and a salary cap, because owning a sports team is just meant to be cool; a social status for the owner? Maybe that's why the league decided to expand into non-hockey markets, yeah those would be great investments! Who cares if nobody comes to the games and we don't make any money right? Owning a hockey team in Phoenix or Atlanta would be fun - while it lasted. Sports teams are not created for eleemosynary purposes. They should not be run that way. Edited December 3, 2011 by AceInTheSleeve Share this post Link to post Share on other sites
egroen 384 Report post Posted December 3, 2011 I can't say whether or not Ilitch cares if he makes money with the wings & tigers. I do think that it is foolish to not care about the health and profitability of your business. But then again maybe that's why the NHL needs a revenue sharing system and a salary cap, because owning a sports team is just meant to be cool; a social status for the owner? Maybe that's why the league decided to expand into non-hockey markets, yeah those would be great investments! Who cares if nobody comes to the games and we don't make any money right? Owning a hockey team in Phoenix or Atlanta would be fun - while it lasted. Sports teams are not created for eleemosynary purposes. They should not be run that way. Everyone makes a salary, it's not like an NHL team needs to make layoffs to show a third quarter profit for its shareholders. Most professional teams are just not run that way, though a few are. If a team is successful, and bringing in a lot of revenue, a lot of owners just increase salaries and expenses in order to not pay the taxes, often preferably showing a loss... especially considering it is a side business to many of them. Ultimately, like investing in a home, it is the long term growth they are mainly interested in. For instance, Ilitch could now sell the Wings for over a $300 mil long term capital gain, which is taxed far less than annual earnings. Share this post Link to post Share on other sites
Wing Across The Pond 196 Report post Posted December 3, 2011 In Soccer, world governing body FIFA is imposing a 'Financial Fair Play' system in 3 years time, with one stipulation stating that a team cannot lose more than 45million Euros (about £38million, or about $60million) over these three years leading up to its implimentation. Manchester City Football Club over here, have lost £190Million in one year. That means they need to make a profit, not just an income but a PROFIT, of about £150million in two years. Whilst it's a good plan to stop soccer teams inflating wages (which has been steadily happening in soccer much like other sports, but has ballooned since City gained investment), it means that Manchester City are actively laying people off, players and staff, in order to cut loses. It also doesn't do well for increased sponsorship over everything (although we've always had that in soccer, just not as much - we've started having training kit sponsors when no one actually watches the teams train), and rapidly increased ticket prices. I really wouldn't want to see this happen in hockey as those poor hockey markets would suffer even more, but maybe the IIHF should sort something so that there is more of a financial parity. It can't really just be a league-wide thing, as it still happens in other leagues around the world. What though, I have no idea. I can't really say I'm too knowledgeable of the potentials for cap systems in sport Share this post Link to post Share on other sites
