Baseball Musings
Baseball Musings
March 08, 2007
Spring Money

Jason McAdams sends along this story of how teams lose money on spring training. What's interesting here is in this instance, the local merchants do well, while the clubs and municipalities lose out.


Posted by David Pinto at 12:43 PM | Management | TrackBack (0)
Comments

I don't buy it. Check out this quote: Not even the Yankees, who sell out every game in a stadium that seats 10,200 (almost double the Jays' capacity) and have a valuable television deal, turn a profit in Tampa. "My guess is that it would be a loss for everybody," Godfrey said.

There's no evidence in this story except for the opinion of the Blue Jays' president. No one bothered to ask teams like the Yanks and the Red Sox who do brisk business selling concessions and tickets to batting practice as well as a sold-out slate of game.

I understand why the Blue Jays in Dunedin might not draw large Spring Training crowds. But I'm not taking what Godfrey says at face value without seeing more evidence from the teams in question.

Posted by: Ben K. at March 8, 2007 01:47 PM

Ben,

After reading your comment, I decided to contact Milner on his piece. Here was my question -

Brian,

Hello. I read your article today and a friend of mine was wondering about the following paragraph you wrote -

"Not even the Yankees, who sell out every game in a stadium that seats 10,200 (almost double the Jays' capacity) and have a valuable televisiondeal, turn a profit in Tampa. "My guess is that it would be a loss for everybody," Godfrey said."

How do you or Godfrey know this to be true? It would have been nice if you would have contacted a few authorities from say the Yankees or the Red Sox and gotten their take. Maybe you did but felt the need not to print it. Do you have any more information on this?

Thank You,
JMM

HIS REPLY:

Hi Jason

Thanks for your inquiry. The information came from several executives (though not one from the Yankees) plus people in charge of the Grapefruit and Cactus Leagues. The teams don't make public their profits and expenses by segments. But as I tried to make clear, these are paper losses related to the accounting methods that teams employ. The Yankees,
for example, load all of the costs of their Florida operations,
including a rookie-league team and a class-A team and a year-round training facility, on to their spring budget. If I had had more space, I would have gone into it in more detail. Nevertheless, I should have made it clear that spring training, on its own, does make money for the teams that have 10,000-seat-plus stadiums and a healthy cut of all revenues,
which is about half of them. The Blue Jays are not among them.

Brian Milner
Sports business columnist
The Globe and Mail
And globesports.com
bmilner@globeandmail.com

I hope this was helpful. It sure was nice of him to be honest and upfront. He replied within a half hour of me sending him this question.

Posted by: Jason McAdams at March 8, 2007 03:06 PM

What I find interesting is that anyone would expect to cover the costs of spring training. It's training, for god's sake. It's a time in which the teams make investments in players and make judgements about their progress.

But I'd bet the "losses" are much smaller than they used to be. Spring training stadiums are increasingly not owned by the teams, so maintenance and repair is some one else's problem. Spring training ticket prices have increased dramatically, and, given the size of today's statiums compared to those 30-40 years ago, attendance has also increased dramatically. This suggests revenue is up a lot.

Where I wind up is this. No one should expect to "make a profit" directly off what is fundamentally a non-commercial activity (in-house employee training and development). But the losses keep getting smaller...

Posted by: Donald A. Coffin at March 9, 2007 12:12 PM
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