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Making More by Spending Less

By Rick Karcher, Michael McCann, Geoffrey Rapp, Greg Skidmore, and Howard Wasserman

Sports Business Daily (subscription only), citing Greg Johns of SEATTLEPI.com, reported yesterday that the Seattle Mariners posted "a $3.18M profit for '09, as opposed to a $4.53M deficit for '08." According to SBD: "That deficit was 'thanks in part to the team's highest payroll ever of $120M combined with a significant drop in attendance to 2.32 million fans from the previous year's 2.67 million.' Attendance declined another 6% this past season to 2.19 million last year, but the Mariners lowered their payroll to about $99M, meaning the club 'essentially made more by spending less.'" Bob Condotta of the Seattle Times attributes the '09 profit "largely to increased revenue due to a better team on the field as the Mariners won 85 games in 2009 after winning just 61 in 2008."

The club "made more by spending less." What an amazing concept! --And that's even with a significant drop in attendance. Also, the club won more games when they reduced their payroll by $21M. I wonder if college athletic departments might learn something from this when 95 of the 120 Football Bowl Subdivision schools are reporting deficits, yet they continue to justify the $2, $3, $4 and now $5 million head coaches' salaries (and $500k to $750K for assistant coaches) on the basis that it will lead to more wins.

Full post as published by Sports Law Blog on March 11, 2010 (boomark / email).