Is Bud Lite Losing Money?

Is Bud Lite Losing Money?

Post by Gary L Pear » Wed, 04 Jan 1995 03:42:36


I just found Brock Hanke's "1993 Baseball Sabermetric" at a used book store
and thought his article on the Brewers had some interesting comments.  Keep
in mind this was written before the *1993* season.....

In 1939, player salaries were 32% of MLB's gross revenues.
In the 1980's, salaries were 39%.
In 1991, it was back down to 32% due to merchandising and TV revenues.

So the breakdown of gross revenues in 1939 was (assuming a 5% profit margin)
Salaries        32%
Other Expenses  63%
Profit           5%

Now quoting the article

"The owners have been claiming that salaries have ben going wild,
outstripping all other expenses, and that they have been losing money.
Sports media all over the country have been buying into this.  The
claim would indicate, and the media believe, that the list looks something
like this:

Salaries         50%
Other Expenses   55%
Profit           -5%

That is, salaries are way up, other expenses are severely down, as a
percentage of gross receipts, and profit has disappeared.  However, what
Charles Korr (the guy who did the research) is claiming is that the
list looks something like this:

Salaries         32%
Other Expenses   55%
Profit           13%

To argue with that, you have to insist that 1) Charles Korr has the salary
percentage of gross receipts wrong, or 2) expenses other than salaries have
been rising faster than salaries have.  The second item is in disagreement
with what the owners themselves have been contending.  As for the first,
well, Charles Korr has done the research, and you and I haven't."

Other tidbits:

"In fact, since the owners claim that the salaries are the fastest-growing
segment of expenses, it stands to reason that the profit percentage of
revenue has been increasing, because other expenses have not been keeping
pace with salaries, and salaries are not eating up any higher percentage
than they were in 1939. ... And that's not counting those hot new expansion
franchise fees."

"All this is to say that the owners, gripe as they will, are making money
hand over fist.  It can't all be going into George Steinbrenner's pockets.
No, even the owners of the smallest cities' franchises are making money.
All this owner complaining is just another negotiating ploy against the
union.  Don't swallow a bit of it."

"Let's face it, Bud Selig is not going bankrupt.  He is not hurting for
money.  He is playing politics, and he is union-busting.  He thinks that
he can stampede the fans of the game into pressuring the players' union
to settle for an unfair contract.  Do you want to be a part of Bud Selig's
little scam here?  Do you really?  What has Bud Selig done for you
lately? ... Do you really believe that, if the owners do break the players'
union, you in Milwaukee will have a better chance at the pennant?  Do you
really?"

--

Elec. Engr., Circuit Card Assembly and Test; 2nd Trumpet; Texas Instruments
     "Correct thinkers think that 'baseball trivia' is an oxymoron:            
          nothing about baseball is trivial." -- George Will

 
 
 

Is Bud Lite Losing Money?

Post by David Niepore » Wed, 04 Jan 1995 05:35:41



Quote:
>"Let's face it, Bud Selig is not going bankrupt.  He is not hurting for
>money.  He is playing politics, and he is union-busting.  He thinks that
>he can stampede the fans of the game into pressuring the players' union
>to settle for an unfair contract.  Do you want to be a part of Bud Selig's
>little scam here?  Do you really?  What has Bud Selig done for you
>lately? ... Do you really believe that, if the owners do break the players'
>union, you in Milwaukee will have a better chance at the pennant?  Do you
>really?"

Yes.  I also believe in the tooth fairy, that Nixon was not a crook, and
that Bill Clinton didn't inhale.  :)
--
David M. Nieporent         Deserves it?  I daresay he does.  Many who live

Deer Creek/Plainsboro, NJ  you give it to them?  Then be not so quick to give
ORIOLES 1995!!!!!!!!       the other.  For not even the wise can see all ends.

 
 
 

Is Bud Lite Losing Money?

Post by TNawroc » Thu, 05 Jan 1995 00:52:02

Quote:
Gary Pearce writes:

:In 1939, player salaries were 32% of MLB's gross revenues.
:In the 1980's, salaries were 39%.
:In 1991, it was back down to 32% due to merchandising and TV revenues.

Something about this doesn't smell right. I recall that the owners' salary
cap proposal would limit player salaries to 53 or so percent of all
revenues. I realize that many owners hide revenue, and that certain
licensing income wouild not fall under the cap, but still, there's a large
difference between spending 32% of your money on salaries and spending
53%.

What this means, if Brock Hanke's figures are correct, is that the owners
are willing to increase the percentage of their revenue going toward
salaries by 65 percent. That can't be right.

Am I missing something here? Or is Hanke way off base?

TN