Brewers franchise value and ability to spend money

[tigerbrew]

With all the money saved by not re-signing players, hope the Brewers go big and get an Ace SP and an elite 3B. Strasburg and Donaldson, get it done Stearns.

[dacrew101]

Go big or go home. Get Rendon and Donaldson

[thebruce44]

My random guy on the internet take is that the Brewers can, and likely will, spend more on payroll this year than last year, but they will do everything they can to minimize risk and maximize competitive advantage. This likely means continuing to trade for cost controlled players and acquisitions at the deadline so that they can evaluate how a player is performing for a couple months or sell if they get bit by injuries or under-performance.

[Ron Robinsons Beard]

David Stearns is always going to be the dad that walks into the store to buy Christmas gifts, and immediately goes over to the clearance rack, despite the fat Christmas bonus in his wallet. I mean, his kids are going to either hate or stop playing with the toys by Jan. 2 anyway, so why spend the big bucks?

[Jopal78]

Brewers operated in the red last season according to TH

 

Check out this article from Milwaukee Journal Sentinel:

 

With eight openings on the Brewers' 40-man roster, Stearns expects busy week at the winter meetings

 

https://www.jsonline.com/story/sports/mlb/brewers/2019/12/06/brewers-david-stearns-has-roster-holes-fill-winter-meetings/4352163002/

 

 

I'm skeptical of any reports about the Brewers finishing in the red. That's basically asking us to just blindly believe the Brewers finances from a reporter who was told by who? Not an objective 3rd party most likely. And as so many have said, there are a lot of creative accounting measures that can help them show a loss when in reality they made money.

But of course nobody on here knows what's going on. I am a bit surprised how many people are concerned about a billionaire losing a few million dollars in a particular year in one of their investments...one that most billionaires get involved in because they enjoy it and less because of the potential financial windfall. But then I also think the idea that the Brewers should take out loans in order to be able to meet the payroll obligations.

 

I think what most fans want is pretty simple. A team that's competitive, that's trying to win and that occasionally will reach a bit further when they're close to winning to add a couple of pieces. I think it's pretty hard to argue that the Brewers HAVEN'T been doing that during Mark Attanasio's tenure.

 

I just want to see the Brewers make smart decisions and every once in a while...sure, I'd like to see them really stretch their financial resources. But it seems like too many want them to do this annually. Strausburg for example. Great pitcher, but he averaged ~145 innings from 26-29. Is that really the type of guy the Brewers should be betting their financial future on? Wheeler was even riskier.

 

I don't think there is a number that anyone can throw out there and say the Brewers should be spending this much per season. We're all just too ignorant about their financials. But just as I'm surprised to see how worried so many are about a billionaires finances, I'm equally surprised in the lack of faith in Attanasio. The idea that he's equally or more invested in making money from the franchise than he is in winning. A lot of these guys buy teams because they've had tremendous success and they want own a franchise so they can win. Again, I really haven't seen evidence that Attanasio is not living up to that.

 

I’m not personally concerned that Attanasio might be losing a few million every year. But if you are looking for a logical, legit reason why payroll isn’t higher, that’s it. Whether you like it or not, it is what it is.

 

Is all of this really that hard? Milwaukee is the worst market in the major leagues. Hemmed in on the west by the Minnesota Twins, to the South by the Chicago Cubs and Chicago White Sox, Southwest by the St. Louis Cardinals and to the east by an enormous lake. Their market is literally the state of Wisconsin and the U.P. That's like 6 million people total and no access to any proximal markets without a MLB team. Now couple that with a team which for most of its existence fielded poor teams and was devoid of superstar players and its easy to see why in their own market, fan interest in the team is best described as 'tepid' unless they're competing for a playoff spot.

 

Mark Attanasio is a billionaire investment banker. Owning a professional sports franchise in one of the major sports leagues is the ultimate investment. There's a finite number of them, they're expensive to purchase, but historically the value only continues to go up. He bought his team for 223 million dollars and the last MLB team to change hands (Miami) did so for 1.2 billion dollars. There's no need to line his pockets with team revenue, because they're already stuffed with cash from his primary gig as a financier.

 

To the contrary, the team kicked in up to 60 million dollars to renovate their spring training facility in Phoenix (with the municipality kicking in 10 million over 5 years time). They're also building a brand new baseball academy in Santa Domingo in the Dominican Republic. There have been numerous renovations to Miller Park in recent years. Not to mention smaller things like paying a design firm for concepts for their recent re-branding. All of these soak up the team's revenue not just contracts for players on the 25 man roster.

 

The caricature of the over grown man-child as owner who wants to win at all costs even if it includes spending his own money, is just that a caricature not based in reality.

[Ron Robinsons Beard]

Is all of this really that hard? Milwaukee is the worst market in the major leagues. Hemmed in on the west by the Minnesota Twins, to the South by the Chicago Cubs and Chicago White Sox, Southwest by the St. Louis Cardinals and to the east by an enormous lake. Their market is literally the state of Wisconsin and the U.P. That's like 6 million people total and no access to any proximal markets without a MLB team. Now couple that with a team which for most of its existence fielded poor teams and was devoid of superstar players and its easy to see why in their own market, fan interest in the team is best described as 'tepid' unless they're competing for a playoff spot.

 

Mark Attanasio is a billionaire investment banker. Owning a professional sports franchise in one of the major sports leagues is the ultimate investment. There's a finite number of them, they're expensive to purchase, but historically the value only continues to go up. He bought his team for 223 million dollars and the last MLB team to change hands (Miami) did so for 1.2 billion dollars. There's no need to line his pockets with team revenue, because they're already stuffed with cash from his primary gig as a financier.

 

To the contrary, the team kicked in up to 60 million dollars to renovate their spring training facility in Phoenix (with the municipality kicking in 10 million over 5 years time). They're also building a brand new baseball academy in Santa Domingo in the Dominican Republic. There have been numerous renovations to Miller Park in recent years. Not to mention smaller things like paying a design firm for concepts for their recent re-branding. All of these soak up the team's revenue not just contracts for players on the 25 man roster.

 

The caricature of the over grown man-child as owner who wants to win at all costs even if it includes spending his own money, is just that a caricature not based in reality.

 

Logical, well-thought-out explanations like this are not, unfortunately, going to stop the "Attanasio can easily pay more, he just doesn't want to" crowd. Those people have already made up their minds.

 

And even if the Brewers decided to open up their payroll to, say, $150-$175 million, it doesn't mean they wouldn't still be looking predominantly for value signings. I personally haven't seen a free agent deal yet that can be considered anything but a top-of-the-market deal for that particular player.

[MrTPlush]

The support for the Brewers is not even remotely close to tepid unless they are competing. The Brewers rank #4 in the NL for attendance since 2007. Only the Cubs, Cardinals, Giants, and Phillies are higher. The Phillies are the ones depending on competing. They drew 3.6mil in their golden years not too long ago, but in recent years couldn't sell 2mil tickets three years in a row.

 

Including the AL I think they may be #7. The only teams in the AL that have drawn more since 2007 are probably Boston. Angels, and Yankees.

 

The interest and attendance the Brewers have is nothing short of incredible. Props to Selig getting a retractable roof, Attanasio/Melvin turning the franchise around, and Stearns continuing to keep them relevant.

[Fear The Chorizo]

The largest contract in Brewer franchise history in terms of dollars/season was Ryan Braun's 5-yr extension of his initial extension to the tune of $105M - and I believe that includes some deferred money gymnastics. That was in the midst of his MVP season, before the PED crap came to light and while Braun was still in his mid-20's. That's pretty much the unicorn scenario for a small market team to throw a ton of coin at a player, who was willing to take a significant discount at the time for financial security.

 

Strasburg, a talented pitcher with an injury-riddled career and obvious longterm concerns as he ages into his 30's, just signed for what could be 7 years, $245M.

 

The difference between the haves and have-nots across MLB in terms of the ability to sign veteran free agents is so drastic it's comical.

[Jopal78]

The support for the Brewers is not even remotely close to tepid unless they are competing. The Brewers rank #4 in the NL for attendance since 2007. Only the Cubs, Cardinals, Giants, and Phillies are higher. The Phillies are the ones depending on competing. They drew 3.6mil in their golden years not too long ago, but in recent years couldn't sell 2mil tickets three years in a row.

 

Including the AL I think they may be #7. The only teams in the AL that have drawn more since 2007 are probably Boston. Angels, and Yankees.

 

The interest and attendance the Brewers have is nothing short of incredible. Props to Selig getting a retractable roof, Attanasio/Melvin turning the franchise around, and Stearns continuing to keep them relevant.

 

I didn't mean interest/support as solely going to the games. While that is a part of it, it is simply people consuming some aspect of the Brewer product; including watching the games on TV, buying merchandise, etc. etc.

 

I noticed you used the year 2007, which of course the Brewers have had only three losing seasons since that point. However have been plenty of 14,000 fan nights at Miller Park since it opened. Even as recently as 2013, 2014 and 2015 there have been plenty of 23,000 fan nights. The Cubs and Giants are filled up almost nightly despite the team on the field.

[tomwopat]

The support for the Brewers is not even remotely close to tepid unless they are competing. The Brewers rank #4 in the NL for attendance since 2007. Only the Cubs, Cardinals, Giants, and Phillies are higher. The Phillies are the ones depending on competing. They drew 3.6mil in their golden years not too long ago, but in recent years couldn't sell 2mil tickets three years in a row.

 

Including the AL I think they may be #7. The only teams in the AL that have drawn more since 2007 are probably Boston. Angels, and Yankees.

 

The interest and attendance the Brewers have is nothing short of incredible. Props to Selig getting a retractable roof, Attanasio/Melvin turning the franchise around, and Stearns continuing to keep them relevant.

 

At the risk of beating the dead horse, the attendance numbers are only part of the picture. The Brewers have made strides in improving their profitability per fan in attendance with the renovations to concessions (e.g. the $15 craft beers), but are still worlds away from the large markets' ability to milk corporate sales that allow them to rake in scads of cash even when there's meager overall attendances.

 

For example, in addition to lucrative luxury boxes, large market ballparks often have club level-esque areas where all-inclusive tickets cost on the order of $200. It takes a number of Brewer fans who eat and drink in the parking lot to match the profitability from one of these tickets, and companies have huge budgets to spend on this sort of thing, as it's often tax deductible.

[KeithStone53151]

 

Attanasio claims the Brewers suffered an operating loss in 2019. I at first saw the twitter posts and thought the writers were just being dumb and didn't hear him correctly. But Attanasio did actually say the Brewers suffered an operating loss. I simply don't buy it. There's just no way. I could buy the bottom line number being in the red, but not the operating number. But you all can make up your own mind on whether he's telling the truth.

[KeithStone53151]

 

Attanasio claims the Brewers suffered an operating loss in 2019. I at first saw the twitter posts and thought the writers were just being dumb and didn't hear him correctly. But Attanasio did actually say the Brewers suffered an operating loss. I simply don't buy it. There's just no way. I could buy the bottom line number being in the red, but not the operating number. But you all can make up your own mind on whether he's telling the truth.

[Dantae]

Would love to see those books

[Dantae]

Would love to see those books

[tmwiese55]

Everyone is just going to say he's lying. Guy stands up directly and answers the question and everyone still going to scream that he's lying and still not enough. No way he can win. Sign Rendon for 250 mil but don't sign an ace pitcher and he's still cheaping out. Of course he could be lying or smudging numbers, but the guy stood there and answered the question everyone's been whining about. And like he said, 5th in Ws in his tenure kinda shows maybe they should get some benefit of the doubt.

 

Also, IDK the distinction you're making with operating vs bottom line. I think all he means is bottom line. Of course businesses can maneuver their books in ways though.

 

I wish people had the fervor to care about their state, federal, local, and local school books/budgets as much as they do their baseball team haha.

[tmwiese55]

Everyone is just going to say he's lying. Guy stands up directly and answers the question and everyone still going to scream that he's lying and still not enough. No way he can win. Sign Rendon for 250 mil but don't sign an ace pitcher and he's still cheaping out. Of course he could be lying or smudging numbers, but the guy stood there and answered the question everyone's been whining about. And like he said, 5th in Ws in his tenure kinda shows maybe they should get some benefit of the doubt.

 

Also, IDK the distinction you're making with operating vs bottom line. I think all he means is bottom line. Of course businesses can maneuver their books in ways though.

 

I wish people had the fervor to care about their state, federal, local, and local school books/budgets as much as they do their baseball team haha.

[KeithStone53151]

Also, IDK the distinction you're making with operating vs bottom line. I think all he means is bottom line. Of course businesses can maneuver their books in ways though.

 

Operating income and net income are two different things. Non-operating and other items will hit "below the line" and impact net income only. The big two are probably interest and taxes though there could be other extraordinary items. It would make more sense if after factoring in interest and taxes(especially interest), they might take a slight loss. I don't however think they operated at a loss.

 

That said, and believe me when I say I understand what you're referring to, don't lump me in with the group that's upset that Stearns/Mark A didn't spend like drunken sailors. I don't have much issue at all with the offseason. I might have done things slightly differently, but I trust their process and am excited about this team.

 

I definitely give Mark a ton of credit for answering so directly even if I don't technically believe him. I also liked how he specifically referred to how they are doing year over year financially, that they can't just look at one year. I took that to more or less mean that an operating loss is OK on occasion when factoring in years like 2015/2016 when we had ultra low payrolls and likely booked a pretty healthy profit. You just can't get crazy where you lose money year after year, start needing to take out debt to keep a healthy cash flow, and then have some bad years and have downswings in revenue.

[KeithStone53151]

Also, IDK the distinction you're making with operating vs bottom line. I think all he means is bottom line. Of course businesses can maneuver their books in ways though.

 

Operating income and net income are two different things. Non-operating and other items will hit "below the line" and impact net income only. The big two are probably interest and taxes though there could be other extraordinary items. It would make more sense if after factoring in interest and taxes(especially interest), they might take a slight loss. I don't however think they operated at a loss.

 

That said, and believe me when I say I understand what you're referring to, don't lump me in with the group that's upset that Stearns/Mark A didn't spend like drunken sailors. I don't have much issue at all with the offseason. I might have done things slightly differently, but I trust their process and am excited about this team.

 

I definitely give Mark a ton of credit for answering so directly even if I don't technically believe him. I also liked how he specifically referred to how they are doing year over year financially, that they can't just look at one year. I took that to more or less mean that an operating loss is OK on occasion when factoring in years like 2015/2016 when we had ultra low payrolls and likely booked a pretty healthy profit. You just can't get crazy where you lose money year after year, start needing to take out debt to keep a healthy cash flow, and then have some bad years and have downswings in revenue.

[3and2Fastball]

As I get closer to the season I distance myself from this topic. I guess I have to get my offseason rants out of my system but when it comes down to it I’m gonna root for my Brewers, and will just resign myself to the reality that they aren’t going to spend as much as I’d like them to.

[3and2Fastball]

As I get closer to the season I distance myself from this topic. I guess I have to get my offseason rants out of my system but when it comes down to it I’m gonna root for my Brewers, and will just resign myself to the reality that they aren’t going to spend as much as I’d like them to.

[tmwiese55]

Yup. I get that, I just meant I think he meant bottom line and not to take the term operating to hard/fast in regards to normal accounting terms. Or at least to realize they might be being a bit loose on the terms in order to fit their spin.

 

Agree with your overall view though. It reads to me that it worked just like they said several years ago when they tanked and didn't spend. They'd wait for a go for it time in the future where it made sense to spend, they found that situation with two one year deals for big money, even if it meant they took a small L for the year. And now they go back to kind of baseline and see how things go from here. All the while not having tons of debt so they're fluid for the future, which is what he talked about in that snippet. Overall I think he laid their plan, thinking and logic as to how to compete consistently for many years out fairly clearly in the past and in this talk.

 

IMO, fans should focus their frustration/blame at the systems in place and hopefully they'll finally put in a fair financial system for all teams. Rather than on the owner who's spent more and brought us more winning than anyone could've realistically imagined in say 2002. Just seems like he should've built up some good will at this point instead of being ripped the way he does

[tmwiese55]

Yup. I get that, I just meant I think he meant bottom line and not to take the term operating to hard/fast in regards to normal accounting terms. Or at least to realize they might be being a bit loose on the terms in order to fit their spin.

 

Agree with your overall view though. It reads to me that it worked just like they said several years ago when they tanked and didn't spend. They'd wait for a go for it time in the future where it made sense to spend, they found that situation with two one year deals for big money, even if it meant they took a small L for the year. And now they go back to kind of baseline and see how things go from here. All the while not having tons of debt so they're fluid for the future, which is what he talked about in that snippet. Overall I think he laid their plan, thinking and logic as to how to compete consistently for many years out fairly clearly in the past and in this talk.

 

IMO, fans should focus their frustration/blame at the systems in place and hopefully they'll finally put in a fair financial system for all teams. Rather than on the owner who's spent more and brought us more winning than anyone could've realistically imagined in say 2002. Just seems like he should've built up some good will at this point instead of being ripped the way he does

[sveumrules]

IMO, fans should focus their frustration/blame at the systems in place and hopefully they'll finally put in a fair financial system for all teams. Rather than on the owner who's spent more and brought us more winning than anyone could've realistically imagined in say 2002. Just seems like he should've built up some good will at this point instead of being ripped the way he does

 

Agreed.

 

Mark A Brewers 2005-19 (Fifteen Years)

 

1233-1198 (8 Winning Seasons, 4 Playoff Appearances)

 

Bud S Brewers 1990-2004 (Fifteen Years before Mark A)

 

1074-1288 (2 Winning Seasons, 0 Playoff Appearances)

 

Kind of hard to argue the last fifteen years have been anything but a marked improvement over the fifteen which came before.

[sveumrules]

IMO, fans should focus their frustration/blame at the systems in place and hopefully they'll finally put in a fair financial system for all teams. Rather than on the owner who's spent more and brought us more winning than anyone could've realistically imagined in say 2002. Just seems like he should've built up some good will at this point instead of being ripped the way he does

 

Agreed.

 

Mark A Brewers 2005-19 (Fifteen Years)

 

1233-1198 (8 Winning Seasons, 4 Playoff Appearances)

 

Bud S Brewers 1990-2004 (Fifteen Years before Mark A)

 

1074-1288 (2 Winning Seasons, 0 Playoff Appearances)

 

Kind of hard to argue the last fifteen years have been anything but a marked improvement over the fifteen which came before.

[CrewFanBrewMan69]

Yeah I’m calling BS they really lost money as an operation. I can somewhat believe it with the CAPEX for renovations at Miller Park and the ST complex, but that goes towards building franchise value so it’s not like that expense/loss is for nothing. There’s also revenues that are exempt from revenue sharing/teams can hide so maybe in their books to MLB they lost money but the real books that shows all the actual revenue they made money.

 

They also could have played accounting games to strategically operate at a loss for Mark’s personal gain with everything else he’s in. Like accelerating depreciation or doing other one time things.