Brewers franchise value and ability to spend money

[RollieTime]

My guess is anything related to baseball operations (including stadium and spring training complex investments) count as operating revenue/expenses, and things such as revenue sharing and maybe merchandise are below the line (not directly related to operating a baseball team).

 

Some things that relate to operating income that have not been discussed are travel costs in 2019 compared to prior years (was their travel schedule easier or more complicated, cost of charter flights versus prior years, costs of shuttling guys to/from majors and AAA, hotel/lodging costs versus prior years, minor league travel costs, etc.). With the booming economy, it's very possible that travel costs - which I imagine are pretty hefty - increased as the overall demand for airfare and lodging has been increasing. Then there's scouting costs (which also incur hefty travel costs), cost of non-player labor (tight labor market), technology investments, liability insurance, security, and plenty of other variables that go into operating costs that we have no idea how much cost and how much have increased over past years. The thought that operating costs are simply ticket/TV revenue versus player salaries is ridiculous.

 

Mark did say that he has never said no to a player acquisition simply due to cost. I imagine that he asks what the impact of signing that player will be in terms of projected additional wins and then makes a decision on cost versus impact, but he said he's never said no simply due to cost.

 

With how much money they have invested in their facilities in Maryville, Dominican, Carolina, Miller Park and then the inflated payroll all have to figure into that. There is a lot more to budget than just players & attendance. They have put such an emphasis in facilities the past 2-3 years across the board. Completely revamped Maryville to state of art facility. Believe they did same in Dominican. They bought Carolina and invested there. Not sure if they pitched in much for Biloxi or if that was all them but it is a top notch AA venue. They continue to update Miller Park. All those cost add up.

 

MA I feel is pretty honest owner and has done great job over past 15 years considering where this team was prior to him. Operating at a loss is vague but my best guess it wasn’t substantial.

 

All of this. There is so much that the Brewers need to pay for behind the scenes that they can’t just throw every dollar they make into payroll. They also have probably over one thousand employees they need to pay. From food vendors to team doctors, other front office personnel, scouting, field crew (in both Milwaukee and Arizona). They also are much more heavily involved in scouting and international signings recently, which obviously takes more money. Miller Park improvements, all fan give aways, different gift cards and things like that given out during games to fans doing things on the big screen, donations to different programs in the city. It all adds up.

 

I’m not sure why it’s so hard to believe that a team that spent $130+ million on payroll, not including any other expense, is somehow still just raking in money. I think Mark is a pretty honest and straight forward owner. I do believe that they took a loss in 2019. I don’t want to get into this big payroll debate like we did before. But when I went through and tried to find the break even point before, I was thinking it was in the $135 million range when I broke it down last season. Them having a payroll around $133 million and taking a loss once you include all of their other expenses is a very realistic possibility and puts it very close to the number I came up with before.

[RollieTime]

My guess is anything related to baseball operations (including stadium and spring training complex investments) count as operating revenue/expenses, and things such as revenue sharing and maybe merchandise are below the line (not directly related to operating a baseball team).

 

Some things that relate to operating income that have not been discussed are travel costs in 2019 compared to prior years (was their travel schedule easier or more complicated, cost of charter flights versus prior years, costs of shuttling guys to/from majors and AAA, hotel/lodging costs versus prior years, minor league travel costs, etc.). With the booming economy, it's very possible that travel costs - which I imagine are pretty hefty - increased as the overall demand for airfare and lodging has been increasing. Then there's scouting costs (which also incur hefty travel costs), cost of non-player labor (tight labor market), technology investments, liability insurance, security, and plenty of other variables that go into operating costs that we have no idea how much cost and how much have increased over past years. The thought that operating costs are simply ticket/TV revenue versus player salaries is ridiculous.

 

Mark did say that he has never said no to a player acquisition simply due to cost. I imagine that he asks what the impact of signing that player will be in terms of projected additional wins and then makes a decision on cost versus impact, but he said he's never said no simply due to cost.

 

With how much money they have invested in their facilities in Maryville, Dominican, Carolina, Miller Park and then the inflated payroll all have to figure into that. There is a lot more to budget than just players & attendance. They have put such an emphasis in facilities the past 2-3 years across the board. Completely revamped Maryville to state of art facility. Believe they did same in Dominican. They bought Carolina and invested there. Not sure if they pitched in much for Biloxi or if that was all them but it is a top notch AA venue. They continue to update Miller Park. All those cost add up.

 

MA I feel is pretty honest owner and has done great job over past 15 years considering where this team was prior to him. Operating at a loss is vague but my best guess it wasn’t substantial.

 

All of this. There is so much that the Brewers need to pay for behind the scenes that they can’t just throw every dollar they make into payroll. They also have probably over one thousand employees they need to pay. From food vendors to team doctors, other front office personnel, scouting, field crew (in both Milwaukee and Arizona). They also are much more heavily involved in scouting and international signings recently, which obviously takes more money. Miller Park improvements, all fan give aways, different gift cards and things like that given out during games to fans doing things on the big screen, donations to different programs in the city. It all adds up.

 

I’m not sure why it’s so hard to believe that a team that spent $130+ million on payroll, not including any other expense, is somehow still just raking in money. I think Mark is a pretty honest and straight forward owner. I do believe that they took a loss in 2019. I don’t want to get into this big payroll debate like we did before. But when I went through and tried to find the break even point before, I was thinking it was in the $135 million range when I broke it down last season. Them having a payroll around $133 million and taking a loss once you include all of their other expenses is a very realistic possibility and puts it very close to the number I came up with before.

[Soupbone]

Somewhere in this thread was the post that we are clamping down on current payroll so that we can extend Yelich. You can forget that. It is not happening. One of the best players in MLB is going to get a contract that the "poor" Brewers can not afford. But hey, we did sign Brock Holt! He is a great fit for our system!

[Soupbone]

Somewhere in this thread was the post that we are clamping down on current payroll so that we can extend Yelich. You can forget that. It is not happening. One of the best players in MLB is going to get a contract that the "poor" Brewers can not afford. But hey, we did sign Brock Holt! He is a great fit for our system!

[Ennder]

I'm always shocked at how negative people are even when the team is doing well and putting a competitive product on the field. You would think we are losing 100 games every year and have no good players and that Mark A has just been a complete jerk the entire time he owned the team and has lied to us at every turn from reading these forums. Absolutely unbelievable.

[Ennder]

I'm always shocked at how negative people are even when the team is doing well and putting a competitive product on the field. You would think we are losing 100 games every year and have no good players and that Mark A has just been a complete jerk the entire time he owned the team and has lied to us at every turn from reading these forums. Absolutely unbelievable.

[Ron Robinsons Beard]

I'm always shocked at how negative people are even when the team is doing well and putting a competitive product on the field. You would think we are losing 100 games every year and have no good players and that Mark A has just been a complete jerk the entire time he owned the team and has lied to us at every turn from reading these forums. Absolutely unbelievable.

 

This.

 

Except that it's totally believable that there are fans that feel that the team is being unfair to them, unfortunately.

[Ron Robinsons Beard]

I'm always shocked at how negative people are even when the team is doing well and putting a competitive product on the field. You would think we are losing 100 games every year and have no good players and that Mark A has just been a complete jerk the entire time he owned the team and has lied to us at every turn from reading these forums. Absolutely unbelievable.

 

This.

 

Except that it's totally believable that there are fans that feel that the team is being unfair to them, unfortunately.

[Soupbone]

If this shock is at my post I am not trying to be negative. Just realistic about the chance we have of signing Yelich to a long term deal. We couldn't sign Grandal this offseason so what makes anyone this we could sign Yelich? If it is directed at the comment about the Holt signing so be it. This is the world Brewer fans live in.

[Soupbone]

If this shock is at my post I am not trying to be negative. Just realistic about the chance we have of signing Yelich to a long term deal. We couldn't sign Grandal this offseason so what makes anyone this we could sign Yelich? If it is directed at the comment about the Holt signing so be it. This is the world Brewer fans live in.

[jjgott]

I'm always shocked at how negative people are even when the team is doing well and putting a competitive product on the field. You would think we are losing 100 games every year and have no good players and that Mark A has just been a complete jerk the entire time he owned the team and has lied to us at every turn from reading these forums. Absolutely unbelievable.

 

I think a lot of it goes to the PR from the beginning of the offseason saying that payroll HAS to be cut, seemingly no matter who may be available in FA. Teams have so much PR leverage in free agency since player salaries are public but team profit is not. All DS and MA had to do was say "we are trying to sign the best guys" and then when they go and sign for $200 mil + say "we gave it a shot" like our offer to CC that we KNEW he'd never accept but could point to and say we tried. Or say something like "we like the versatility of a Sogard/Gyorko platoon over Moose" (ok, this one is a little less believable). But what I'm getting at is there was a way for the team to make plausible cases for their FA strategy that did not require them to immediately cry poor to justify Avisail Garcia as their big money offseason signing.

[jjgott]

I'm always shocked at how negative people are even when the team is doing well and putting a competitive product on the field. You would think we are losing 100 games every year and have no good players and that Mark A has just been a complete jerk the entire time he owned the team and has lied to us at every turn from reading these forums. Absolutely unbelievable.

 

I think a lot of it goes to the PR from the beginning of the offseason saying that payroll HAS to be cut, seemingly no matter who may be available in FA. Teams have so much PR leverage in free agency since player salaries are public but team profit is not. All DS and MA had to do was say "we are trying to sign the best guys" and then when they go and sign for $200 mil + say "we gave it a shot" like our offer to CC that we KNEW he'd never accept but could point to and say we tried. Or say something like "we like the versatility of a Sogard/Gyorko platoon over Moose" (ok, this one is a little less believable). But what I'm getting at is there was a way for the team to make plausible cases for their FA strategy that did not require them to immediately cry poor to justify Avisail Garcia as their big money offseason signing.

[tmwiese55]

I'm always shocked at how negative people are even when the team is doing well and putting a competitive product on the field. You would think we are losing 100 games every year and have no good players and that Mark A has just been a complete jerk the entire time he owned the team and has lied to us at every turn from reading these forums. Absolutely unbelievable.

 

Well said. You'd think he would've built up some goodwill or faith by now. But, many people are happiest complaining, really about anything in life. And the current social media and internet world just allows people to show it more.

[tmwiese55]

I'm always shocked at how negative people are even when the team is doing well and putting a competitive product on the field. You would think we are losing 100 games every year and have no good players and that Mark A has just been a complete jerk the entire time he owned the team and has lied to us at every turn from reading these forums. Absolutely unbelievable.

 

Well said. You'd think he would've built up some goodwill or faith by now. But, many people are happiest complaining, really about anything in life. And the current social media and internet world just allows people to show it more.

[sveumrules]

But what I'm getting at is there was a way for the team to make plausible cases for their FA strategy that did not require them to immediately cry poor to justify Avisail Garcia as their big money offseason signing.

 

You say "cry poor", I say "behave in a manner which maintains both current competitiveness & future flexibility".

 

One of those tomato tomato situations, I guess.

[sveumrules]

But what I'm getting at is there was a way for the team to make plausible cases for their FA strategy that did not require them to immediately cry poor to justify Avisail Garcia as their big money offseason signing.

 

You say "cry poor", I say "behave in a manner which maintains both current competitiveness & future flexibility".

 

One of those tomato tomato situations, I guess.

[MrTPlush]

The Brewers aren't saving money to pay Yelich. Sorry, but it isn't happening. Remember when Attanasio always claimed they could overspend when competing and he would have no problem doing so? Welp, here we are, in the midst of the best stretch of baseball in franchise history and he is slashing payroll crying poor.

 

I don't care if he does, his team, and most owners are worse than him. Is what it is.

[MrTPlush]

The Brewers aren't saving money to pay Yelich. Sorry, but it isn't happening. Remember when Attanasio always claimed they could overspend when competing and he would have no problem doing so? Welp, here we are, in the midst of the best stretch of baseball in franchise history and he is slashing payroll crying poor.

 

I don't care if he does, his team, and most owners are worse than him. Is what it is.

[sveumrules]

The Brewers raised payroll by 30 million dollars to a level that is not sustainable year over year specifically because two players were available on sweetheart one year deals. You can characterize them not spending that money again because no similar values were available as "slashing payroll", I'd characterize it as returning to a sustainable level.

 

From 2011 to 2015 the Brewers payroll increased from 83 to 104 million while their wins decreased from 96 to 68. (If they spent more why didn't they win more?!?!? Weird). They then lowered payroll to 60 million when they were non competitive for two years before raising it back to previous levels once they were competitive again. Nothing disingenuous there.

 

I have less than a hundred dollars in the bank. By typing that on the internet I am not crying poor, merely stating my financial reality. I believe Mark A is doing the same thing, stating the financial reality of the Brewers.

 

Can anyone please link where he is "crying" about it?

[sveumrules]

The Brewers raised payroll by 30 million dollars to a level that is not sustainable year over year specifically because two players were available on sweetheart one year deals. You can characterize them not spending that money again because no similar values were available as "slashing payroll", I'd characterize it as returning to a sustainable level.

 

From 2011 to 2015 the Brewers payroll increased from 83 to 104 million while their wins decreased from 96 to 68. (If they spent more why didn't they win more?!?!? Weird). They then lowered payroll to 60 million when they were non competitive for two years before raising it back to previous levels once they were competitive again. Nothing disingenuous there.

 

I have less than a hundred dollars in the bank. By typing that on the internet I am not crying poor, merely stating my financial reality. I believe Mark A is doing the same thing, stating the financial reality of the Brewers.

 

Can anyone please link where he is "crying" about it?

[brewerfan82]

I think I just hate the term "crying poor". He was asked if they lost money last year and he said yes. They've demonstrated for years now that their plan to maintain a competitive team requires them to evaluate players' values and not overpay for players based on those evaluations. They've shown that when a player becomes available at the price they deem worthwhile, they will spend the money to obtain them, even if it puts them over budget. In the absence of a bigger name player that was obtainable at a price they felt was beneficial, they were able to rebuild the team incrementally with players that they deemed more valuable at their acquisition costs than the more expensive players available on the market.

 

All this seems very responsible, logical, and in the best interest of the longterm success of the team. "Crying poor" makes it sound like a whiny excuse for not overpaying for players, which I'm glad they haven't done.

[brewerfan82]

I think I just hate the term "crying poor". He was asked if they lost money last year and he said yes. They've demonstrated for years now that their plan to maintain a competitive team requires them to evaluate players' values and not overpay for players based on those evaluations. They've shown that when a player becomes available at the price they deem worthwhile, they will spend the money to obtain them, even if it puts them over budget. In the absence of a bigger name player that was obtainable at a price they felt was beneficial, they were able to rebuild the team incrementally with players that they deemed more valuable at their acquisition costs than the more expensive players available on the market.

 

All this seems very responsible, logical, and in the best interest of the longterm success of the team. "Crying poor" makes it sound like a whiny excuse for not overpaying for players, which I'm glad they haven't done.

[SeaBass]

I'm not hearing the "crying poor" thing that others seem to be hearing. I'm hearing they're going to kick some butt on the field this season and it just so happens that they'll be doing it for less money than previous seasons. I'm hearing they'll stretch the budget when it makes sense to do it, not just for the sake of doing it. Lot of glass half empty mentalities around here.

[SeaBass]

I'm not hearing the "crying poor" thing that others seem to be hearing. I'm hearing they're going to kick some butt on the field this season and it just so happens that they'll be doing it for less money than previous seasons. I'm hearing they'll stretch the budget when it makes sense to do it, not just for the sake of doing it. Lot of glass half empty mentalities around here.

[tmwiese55]

The Brewers aren't saving money to pay Yelich. Sorry, but it isn't happening. Remember when Attanasio always claimed they could overspend when competing and he would have no problem doing so? Welp, here we are, in the midst of the best stretch of baseball in franchise history and he is slashing payroll crying poor.

 

I don't care if he does, his team, and most owners are worse than him. Is what it is.

 

He just did that last year when the opportunities presented themselves. The year before that he handed out the largest FA contract they ever did and traded for a guy on the books for 40-50 mil. Once you splurge you can now never go backwards and need to spend just to spend no matter the years later consequences? What options were out there to spend that money for this year that wouldn't be a big problem in future years? All the good plays got big multi year deals that would a big problem for the Brewers. I think they got killed by this market (in spite of the mass collusion, eye roll) and had to wait for next year and hopefully find some place to spend next year that makes sense.

 

And yes, I do think they're budgeting to make an honest attempt at Yelich that will likely fall through.

 

Good phrasing on your post Seabass.