This Could Get Messy: Revenues and the Minnesota Twins

by Jesse on Nov 20, 2009 5:17 PM EST in Speculation Comment 41 comments

I've been inspired.

Eric in Madison is one of Twinkie Town's original members, and I'm fairly certain he was onboard for the switch from Twins Territory via Twins Geek over to where we currently chill and chat about Twins baseball. Eric, you signed up on November 19, 2005. That was four years ago yesterday. Well done, sir.

At any rate, I want to get this out of the way: I usually don't tackle things like this. Why? Honestly, part of me doesn't care. Part of me is more concerned about evaluation of current or prospective players (and prospects) and how they fit into the future of the club. But part of me, a small part, agrees that it would be extraordinarily helpful in our evaluation of the organization's use of funds if we knew how much they had to spend. Generally.

This gets a little tricky in that next spring, the Twins more into Target Field. Revenues will jump, dramatically, because...well, because it will actually be the home of the Minnesota Twins. For those of you who weren't hip (how about that for dated slang that outdates me), the revenues the Twins received through the Metrodome were stunted because it was a building that belonged to the Minnesota Vikings. The Vikes grabbed a major percentage of revenues from things like parking and beer and hot dogs. And so now that the Twins have their own park, they'll start to reap the benefit of additional revenue, because they won't have to give up a percentage of it to a sports team that plays a completely different game.

Eric's conversation in the FanPosts is intriquing, and ultimately it asked one question: how much can we expect the Twins to take in revenue in 2010?

I can't answer that question, because I have no idea how to find out how much more they'll be able to pull in now that revenues belong exclusively to them. But what I can do, courtesy of Forbes, is tell you what revenues the Twins have pulled in via the Metrodome over the last ten years.

We'll compare those revenues with the payrolls of the following season, because that's how the Twins have allegedly awarded money towards payroll. We can't use revenues for the the same year as the payroll, because that doesn't make any sense.

Year	Revenue	Year	Opening Day Payroll	Payroll % of Revenue
2000	$48,000,000	2001	$24,100,000	50.2
2001	$58,000,000	2002	$40,200,000	83.8
2002	$75,000,000	2003	$55,500,000	74.0
2003	$87,000,000	2004	$53,600,000	61.6
2004	$99,000,000	2005	$56,200,000	56.8
2005	$102,000,000	2006	$63,400,000	62.2
2006	$114,000,000	2007	$71,400,000	62.6
2007	$131,000,000	2008	$62,200,000	47.5
2008	$149,000,000	2009	$65,300,000	43.8
2009	$158,000,000	2010	$83,000,000	52.5
Total	$1,021,000,000	--	$534,900,000	52.4

Now, these numbers are based off either A) the revenue number provided by Forbes or B) the payroll numbers provided by relevant links or Cots Contracts figures.

The problem is that I can't guarantee what those revenue numbers include, but the Forbes article itself says the Twins spent around 63% of revenue on players over the last five seasons compared to 57% league average. Obviously the numbers somewhere don't jive.

Minnesota has averaged a $14 million bump in revenue over the last four seasons, but ignore that for now. If we're taking this season's revenues to calculate next year's payroll, then $83 million isn't a bad total. No doubt, however, the Twins are correctly anticipating increased revenues thanks to Target Field.

If we want accurate figures there's a lot of research to do, and there's still no guarantee how close or accurate we could be in regards to predicting next year's available payroll. Knowing what I know now, and keep in mind that is more than subject to whatever facts are laid out in the comments section below, I have to believe the Twins are probably right around the mark in terms of payroll VS revenues. At least, until someone can prove otherwise.

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Indeed, yes, I have been around forever

Frankly, I’m not sure how that reflects on me. Am I going to start crabbing at all of you to get off my lawn? Hopefully not.

Anyway, thanks for taking this up Jesse. I think it’s an interesting question, both for payroll reasons and just because, well, it is. Many of you paid for this new palace.

At any rate, one thing I disagree with you about a little Jesse is the idea that it doesn’t make sense to correlate year 1 payroll with year 1 revenue, but rather year 1 revenue has to be compared to year 2 payroll. I don’t think this is really true; my guess is that they can pretty accurately estimate their revenue for the upcoming year, and base payroll on that if they so choose.

Anyway, I speculated in the fan post that their revenue would probably clear $200 million in 2010, and I feel pretty comfortable with that assumption. Any information or speculation people have on this topic would be appreciated.

by Eric in Madison on Nov 20, 2009 5:40 PM EST reply actions 0 recs

I thought about that after I published and was reading it over.

You’re right—I’m sure the Twins can pretty accurately predict their revenues from year-to-year. They have to, to some degree—they’re a business.

If the average jump in revenue over the last four years is $14 million, I think it’s realistic to expect that number to double. If they pull in a $30 million jump next season that pulls the revenues to roughly $190 million. $200 million isn’t out of the question. This tells me that it’s more than realistic for the Twins to reach the $100 million payroll mark next year, if not this year.

Anyone who wants a jump in Minnesota’s payroll is going to get it.

by Jesse on Nov 20, 2009 5:55 PM EST up reply actions 0 recs

Numbers don't jive

Jesse, the reason your numbers don’t jive, is that the Forbes article compares “player expenses”, defined as payroll plus bonuses and benefits, likely including draft picks, minor leaguers, etc:

2009: $80M
2008: $81M
2007: $76M
2006: $73M
2005: $69M

by Adam Peterson on Nov 20, 2009 6:59 PM EST reply actions 0 recs

Deltas between payroll and expenses each year

are interesting…

2009: $15M
2008: $19M
2007: $5M
2006: $10M
2005: $13M

Boy, we sure didn’t spend much beyond payroll on our players in 2007. Perhaps that should not be surprising, considering payroll was at a high water mark over the past five years as a percentage of previous year’s revenue. This gives us a good idea of the “ceiling” the Twins organization is willing to accept.

Oh, and who was our 2007 first round pick? Ben Revere, who signed for $750K, about $500K below slot.

by Adam Peterson on Nov 20, 2009 7:09 PM EST up reply actions 0 recs

Interesting point regarding 2010 payroll

You note that “We can’t use revenues for the the same year as the payroll, because that doesn’t make any sense.”

But what have we been doing for the last month speculating about 2010 payroll? We’ve been assuming a big bump due to increased revenue from the new stadium. Given your assumption, we should expect the payroll bump in 2011, right?

Of course, I expect the Twins to bump payroll a bit, but a bump to $100M is quite a bit considering 2009 revenues…

by Adam Peterson on Nov 20, 2009 7:03 PM EST reply actions 0 recs

Revenue is expected to increase 20-40 % in the new stadium

Unlike in the Dome, the new stadium gives Twins all revenue from suites, parking and concessions. Their Dome lease gave them no suite revenue (not even tickets sold), no parking revenue (the Strib got most of that) and 25 % of concessions. (Are you wondering why service is so bad at Twins games? It’s because the Twins don’t pay servers. They all work as volunteers one game a year for their charity. So they have no clue what they’re doing.) Assuming attendance is steady in Target field (unlikely), they will get 20% more revenue than in 2009. I expect attendance to go above 3 million in the new digs, which would result in a 40 % increase in revenue in the first couple of years.

BTW, the Metropolitan Sports Facilities Commission (MSFC)—the same body that let the North Stars leave and did all it could to get rid of the Twins with the worst lease in baseball—is trying to treat the Vikings as it did the Twins and North Stars. While the Twins paid rent all these years, the Vikings got free rent for the last 10 years, all suite revenue (including Twins games) and 75% of concessions FOR TWINS GAMES. Now that the Twins are gone, the commission wants the Vikings to pay their rent. And the Vikings will no longer get Twins concession or suite revenue, so it’s no coincidence that they’re balking at the MSFC is offering. It’s all bad for the Vikings, unless the commission figures out a way to give them the surplus they’ve been gathering all these years from the Twins (estimated at $50 million).

"You're thinking too much. Just have fun." -- Bennie "The Jet" Rodriguez in Sandlot

by cmathewson on Nov 21, 2009 12:11 AM EST up reply actions 0 recs

Is that 20-40 percent

on top of the, for argument’s sake, $14 million increase they would have had if they had stayed in the Dome? That’s the average increase over the last four seasons.

If we’re conservative and say no, it’s just a flat 20%—that’s $30 million on top of last year’s $158 MM for an apporoximate $190 million in revenues for year 1 in Target Field. If that’s the conservative estimate, I think expecting a $200 million revenue total for next season isn’t unrealistic.

I like this thread.

by Jesse on Nov 21, 2009 10:07 AM EST up reply actions 0 recs

I estimate $200 million in revenues in 2010

But I differ on the budgeting process. I think they spend 52% of revenues on the baseball department, about 90% of which is major league payroll and 10% goes to scouting, drafting, signing, spring training and minor league operations. So I think their budget will be about $90 million, give or take.

"You're thinking too much. Just have fun." -- Bennie "The Jet" Rodriguez in Sandlot

by cmathewson on Nov 21, 2009 11:23 AM EST up reply actions 0 recs

Where does the other 48% of revenue go?

by Eric in Madison on Nov 21, 2009 1:25 PM EST up reply actions 0 recs

A number of places

Other operations outside of player expenses.
Debt servicing, including interest.
Taxes.
Depreciation / amortization of assets.

According to the same Forbes article, the Twins have steadily increased their operating income over the past five years:

2005: $0M
2006: $7M
2007: $15M
2008: $24M
2009: $27M

I’m guessing some of this goes to the owners’ pockets, but hopefully a good portion is in the bank to help out in signing Mauer. Who knows…

by Adam Peterson on Nov 21, 2009 1:35 PM EST up reply actions 0 recs

I'm not arguing whether 2010 revenue will go up

I’m just pointing out that 2009 revenues are set, independent of the new stadium. If we are truly basing each year’s payroll on the previous year’s revenue, then 2011 would eb the year we see the large payroll jump.

by Adam Peterson on Nov 21, 2009 11:04 AM EST up reply actions 0 recs

Payroll is set on the next year's budget, not the previous year's revenue

The budget includes the previous year’s revenues. But the Twins have a pretty good sense of where revenues will go in the first year of their new park. The budget will be between $88 million and $93 million, depending on what they decide to do with the 2009 surplus (they were under budget on payroll and over budget on attendance).

"You're thinking too much. Just have fun." -- Bennie "The Jet" Rodriguez in Sandlot

by cmathewson on Nov 21, 2009 11:20 AM EST up reply actions 0 recs

I agree with your targets

I’m probably leaning to the higher end of the scale, around $93M total.

And yes, payroll would be set on next year’s budget, which obviously includes an estimate of this year’s revenues. I was originally replying to Jesse’s emphatic statements in his post that payroll is based on the previous year’s revenues…

by Adam Peterson on Nov 21, 2009 1:29 PM EST up reply actions 0 recs

It seems to me

that the payroll could be closer to $100 million and there still could be significant profit.

by Eric in Madison on Nov 21, 2009 1:37 PM EST up reply actions 0 recs

Yes, there could be profit

but also remember our payroll landscape changes after 2011, as the Sloweys, Bakers, etc salaries increase quite a bit. Simply keeping much of the same core around in 2011 could cost us more than $100M by itself (especially when Mauer’s making over $20M per year), and that’s before any improvements.

I could see $100M, but probably only with shorter Crede types of commitments that don’t extend past 2010.

by Adam Peterson on Nov 21, 2009 2:57 PM EST up reply actions 0 recs

win/revenue curve

Every team has their own win/revenue curve. In general, more winning = more revenue. However, larger markets and better stadium deals increase the incentive to win because winning becomes that much more lucrative. It is not a coincidence that the Yankees sign the top 3 free agents right before opening NuYankee stadium. In 2007 the Twins had the flattest win revenue curve, that should improve significantly in Target Stadium.

by Jon Kammerer on Nov 20, 2009 8:35 PM EST reply actions 0 recs

Yankees signing Teixeira, Sabathia and Burnett

had more to do with Mussina, Giambi, Abreu and Pavano’s horrible contracts coming off the books. In fact, according to Forbes, the Yankees overall player expenses went down from $253M in 2008 to $236M last year.

Of course, moving into the new stadium makes the long term contracts a bit more palatable…

by Adam Peterson on Nov 20, 2009 9:02 PM EST up reply actions 0 recs

$425M in contracts

The Yankees took on a lot of long term risk, so they must have felt that balanced by the short term gain. It is not the yearly value of contracts that makes them risky but the number of years. Santana would still be a Twin if he would would have signed for 3/66 instead of the 6/137 with a vesting option for 7/157.

by Jon Kammerer on Nov 21, 2009 9:13 AM EST up reply actions 0 recs

Anyway that we can find a team who was in a similar situation?

That is, another team who shared a stadium with another team and had to give part of its revenue to it, and then moved to its own stadium and see how it impacted their revenue?

by SPENCEMAN on Nov 20, 2009 8:55 PM EST reply actions 0 recs

Two very interesting posts

If they spend $83M next year it would bring us up to the Cleveland/SF level, around 14th in the MLB (In 2009 terms). If they spend $100M, it would put them at the Seattle/LAD level, around 10th in the MLB. Both big jumps from 24th in 2009.

I think we can have our Mauer, and keep him too!

"Is it normal to wake up in the morning in a sweat because you can't wait to beat another human's guts out?" -Joe Kapp

by less cowbell, more 'neau on Nov 20, 2009 11:35 PM EST reply actions 0 recs

couple of notes

If they made 158M in revenues last year, it is very reasonable to assume they will be bringing in somewhere north of 180M this season, possibly even 200M. I initially thought a 90+M payroll was absurd for this team, but I didn’t realize they brought in that much last season. I am on the bandwagon that I don’t believe they are done. I think they are making room to give Mauer a payraise and hopefully make another big splash coupled with a few smaller ones. They certainly have the room to do it seeing the big jump in revenues. A weaker division means they’d have a very reasonable shot at playoff game(s) too which could add to it. They seem aggressive this year… I’ll go out on a limb and predict their payroll to be 95-100M after Mauer’s extension, which I think will give them room to do the following (after the extension):

1) Add a FA 2B (like Felipe Lopez) or trade for one (Brandon Phillips or Dan Uggla)
2) Take cheap fliers on a couple guys like Crede/Glauss/Sheets
3) Possibly… and I mean possibly, bring on Pavano to a 2 year deal.

I’m not sure on the 3rd one, but I do think they have the financial resources to shore up some of our weaknesses for the first time in as long as I can remember. Given their tax payer funded stadium, I could see them doing this even if their revenues don’t top 200M… as they would essentially be running reduced profits to keep the fans happy for a year or two.

by diehardtwinsfan on Nov 21, 2009 9:23 AM EST reply actions 0 recs

Sweet Spot

The other interesting thing that may motivate the Twins to be aggressive this offseason is that they are on the sweet spot on the win revenue/curve. Wins that put a team in/near the playoffs produce more revenue than wins that take a team from terrible to bad. Nate Silver did a study suggesting optimal strategies for teams with differing true talents.

I. Rebuilding <82 wins, Sell
II. Fringe contender 82-87 wins, Buy or Sell
III. Legitimate contender 87-92 wins, Buy

“The decision to buy here is clear. These clubs have the most to gain from adding additional talent, and they will usually be the ones driving the free-agent and trade markets. A Category III team playing in a smaller market, like Oakland or Minnesota, has less margin for error, and might think about one or two year commitments instead of multiyear deals, but they still ought to be aggressively seeking out ways to improve their stock of talent. "

IV. Established 92-97 wins, Hold
V. Juggernat 97 +, Sell

I’ve got the the Twins as a 88-91 win team depending on the projection system used. They should try to upgrade at 2 spots, likely infield and SP. They will probably lean towards free agents that don’t require long term commitments. The rest of Silver’s article can be found behind the Prospectus wall at http://www.baseballprospectus.com/article.php?articleid=4618.

by Jon Kammerer on Nov 21, 2009 9:30 AM EST reply actions 0 recs

Thanks for that.

I don’t really have anything to add to this, other than to say it makes interesting reading.

by Jesse on Nov 21, 2009 10:02 AM EST up reply actions 0 recs

Exactly

Adding a few league average players could take us from an 89 win win projected team, to a 93-94 win projected team. Those 4-5 wins are worth way more than the 18 mil or so they’d normally be worth on the free agent market, since they increase our playoff odds considerably. Also, I don’t think it would be 18 mil. Someone like Jamey carroll would cost a couple mil and add a win or so. ditto Joe Crede.

by lookatthosetwins on Nov 23, 2009 6:19 PM EST up reply actions 0 recs

Twins Can afford $99.6-104.6 Million in Payroll for 2010

All Twins payroll projections should be based on the payroll of 2007 as a starting point as the Twins should not get credit for getting back to normal after the dramatic payroll slash after the 2007 season.

2007 Payroll – $71.5 Million (Source: http://mlbcontracts.blogspot.com/2005/01/minnesota-twins_17.html)

Avg Payroll Increase between 2007-2008 – %7.1 (Source http://baseball.about.com/od/newsrumors/a/08teamsalaries.htm)

2008 Payroll Capcity – $76.6 Million ($71.5 * 1.071)

Avg Payroll Increase between 2008-2009 – %4 (Source http://baseball.about.com/od/newsrumors/a/09teamsalaries.htm)

2009 Payroll Capacity – $79.6 Million ($76.6 * 1.04)

New Stadium Revenue – $20-25 Million (Source: Dave St. Peter Quote http://www.startribune.com/local/18217239.html)

2010 Payroll Capacity – $99.6-104.6 MillionI know the Twins are trying to put feelers out there that $85-90 Million is acceptable (Source http://mlb.mlb.com/news/article.jsp?ymd=20091102&content_id=7604978&vkey=news_min&fext=.jsp&c_id=min&partnerId=rss_min) but that is just the Twins attempting to be cheap.

by jesseh on Nov 21, 2009 1:51 PM EST reply actions 0 recs

This assumes that 2007 was a good baseline

from a business perspective. Based on Jesse’s numbers and some of the comments I posted earlier (non payroll portions of player expenses), I suspect we overextended ourselves a bit in 2007, then corrected in 2008 and 2009. Probably an overcorrection, but I don’t think we can assume 2007, the year with our highest payroll as a percentage of previous year’s revenues, is “normal”.

That said, I think $100M is supportable for 2010. It’s not getting into bigger trouble in 2011 and beyond that will be difficult.

by Adam Peterson on Nov 21, 2009 3:04 PM EST up reply actions 0 recs

Sure, but there's always ways to dump salary

Cuddyer;s contract will run out, Punto’s will run out, etc. Nathan. It seems to me that you have a tremendous window right now in 2010-11 to try to win—a bulk of star and near star players in their prime, a new stadium building local excitement, a massive increase in revenue.

Strike while the iron is hot, I say. This is your shot. Take it.

by Eric in Madison on Nov 21, 2009 3:46 PM EST up reply actions 0 recs

+1

Using three years of data to support theories on payroll isn’t enough data. Most of what we’re all talking about is speculation, and this theory isn’t any different. It’s all informed speculation, but that’s pretty much as far as it goes.

Realistically, I think we have enough to say the Twins could add another $10 million to this season’s payroll, for a total of roughly $93 million. Anymore than that and we start assuming more things about revenues and percentages. But at the same time I still want the Twins spending smart, not throwing money away on marginal free agents on multi-year deals.

by Jesse on Nov 22, 2009 7:50 AM EST up reply actions 0 recs

Jesseh

Says the new stadium revenue should up revenue $20-25M. You are forgetting that the Twins typically strive for about 50% of revenue going to payroll so in reality the payroll would only go up $10-12.5M. The team did fund part of the stadium with their own money which they will use the extra revenue to pay down their debt.

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by FishingMN on Nov 22, 2009 9:00 AM EST up reply actions 0 recs

What?

Twins, 50% revenue, right. That’s not forgotten. I’m sorry, I’m not sure what point you’re trying to make. Are you saying that payroll is already where it should end up, or that $93 million is a fairly accurate guess, or that we should expect it to be higher?

by Jesse on Nov 22, 2009 9:49 AM EST up reply actions 0 recs

New stadium revenue

it seems to me, should be an much larger increase than $20-25 million. Assume even a conservative increase of 500,000 fans at a radically conservative $20 a ticket (it will be more for just tickets). That’s $10 million JUST in ticket purchases for fan increase. Then you realize that all tickets will be more expensive than the dome, that the Twins are getting a much larger percentage of concession and parking revenue, and you are looking at at least an increase of $50 million just in fans showing up to the park.

by Eric in Madison on Nov 22, 2009 11:08 AM EST up reply actions 0 recs

Read the Trib Article

"That’s all new money," said Twins President Dave St. Peter, who notes that the ballpark will generate $40 million to $50 million a year in new revenues.

When I did %50 of that I came to the $20-25 million number.

by jesseh on Nov 22, 2009 2:13 PM EST up reply actions 0 recs

$40-50M additional revenue

seems about right to me, as does $20-25M additional payroll. The key here is, additional payroll relative to what? Simply adding to last year’s $65M brings us up to $85-90M. However, many of us (including me) believe the last two years payroll were a bit on the low side relative to revenue, I’d estimate $5-10M. That brings us up to $90-100M which is where I think this will settle in the end. Perhaps above $100M, but only if we tear up Mauer’s final year as part of an extension, IMO.

by Adam Peterson on Nov 23, 2009 8:22 AM EST up reply actions 0 recs

Where do the revenues come from?

1.) Attendance…2.4 million in 2009…What is average Ticket price?
2.) Local Broadcast Revenue…How much? $10 millionish?
3.) Share of National Broadcast Revenue…How much? $15-20 millionish? Or higher?
4.) Revenue Sharing…Are the Twins expected to receive any?
5.) Merchandise…Jerseys, Hats, etal…How Much?
6.) Concessions…

Sorry, but as an accountant, if you want to budget or project future revenues, you need to break the revenue streams into their component parts. I think I’ve got most of them here, not sure of that fact.

1.) Attendance…How much will attendance increase due to Target Field? 200K to 500K? Is that effect sustainable over a long period of time (say more than 2/3 years?)There will surely be some I suspect. Also, How much increase will there be in average ticket price? This should be the largest increase in revenues, an interesting question, How many unique games be lost to weather? 2/3 or 7/8. The higher number could reduce the gate up to 10% of projection, particularly IF they are made up as non-day/night DH’s.

I suspect that 2.) Local Broadcast Revenue, 3.) National Broadcast Revenue are contractual and moving to Target Field has little or no impact on 2010 revenues. I also doubt there is much, if any increases here.

4.) Revenue sharing…as to this segment I suspect it is not particularly significant and likely to diminish or be eliminated entirely.

5.) Merchandise…I suspect that there will be Target Field related items will do very well initially…Is this a 1 shot deal? Is that product line significant? With uniform changes should see some increases in merchandise revenues…How much? Is it significant?

6.) Concessions…This will obviously increase due to changed circumstances. Since I don’t have a baseline to project from, will it increase $5/10/15 mill?

NEW Revenue stream…Suites fall into this category. Does this new category have the potential to ADD $8-10 million? Should the difficulties of the general economy temper expectations in this area.

Summing up. Without knowing what percentage of current revenues are basically fixed (2,3&4). If this is currently say 20% of the total revenue, that higher overall projections may have merit, if it’s closer to 35/50% of current revenue, it’s much harder to have extremely rosy Revenue increase projections. The other segment of variable revenue, which has a good upside potential, will the current economic situation mute those benefits?

Regards,

I don't suffer from insanity...I relish every moment of it!

by the Dragon on Nov 22, 2009 10:06 AM EST reply actions 0 recs

Well

These are things we don’t know, but there will certainly be a huge increase in revenue due to ticket sales (more tickets, more expensive), concessions, parking (things the Twins got very little of in the metrodome). I speculated elsewhere that, assuming 3,000,000 fans (likely at least the first year and probably 2-3 years assuming they are competitive), you have to be looking at $100,000,000 at least just in money fans leave behind for tickets, concessions, parking, etc. That’s assuming $33 per fan, which is probably too low, given many of the tickets alone are more than that. I don’t know what sort of assumptions they make here, but this is one area where I’m sure the team has a good idea of how much each person through the turnstiles is worth. I can make reasonable assumptions that pushes it to $50 a fan, which would mean $150 million in revenue based on 3,000,000,000 fans, but I don’t know.

Local broadcast revenue is definitely more than $10 million; Jayson Start reported that 29 of the 30 teams are at least $15 million. I guessed $25 million elsewhere, but I really don’t know.

Share of national money (incl. but not limited to national TV) is $40 million (or $30 million after the mandatory pension and operating payments to MLB).

New revenue not only includes suites, but in stadium advertising, naming rights. Don’t know how much we are talking here either.

There are a lot of things we don’t know about revenues; that’s what I’m trying to figure out. It seems to me that if the $158 million number Forbes reported (not clear what that includes either), is close to accurate, then you have to assume that number will increase to at least $200 million, and probably more. However, there are many things we just don’t know.

As for the revenue sharing money, they certainly have received money in the past, whether that continues in the new park is not clear; they do deduct new stadium expenses from their revenue calculations for the purposes of revenue sharing, so they may get the best of both worlds, at least for a while.

by Eric in Madison on Nov 22, 2009 11:22 AM EST up reply actions 0 recs

Suites

Income above and beyond the ticket sales.You have to buy a suite…then the tickets.

The Twins pretty much will sell 2.8 million tickets for the season. Not sure if they are holding ANY back for week/day sales. As the season starts, someone will start buying them up with the hope for resale. As a non-season ticket holder, I expect to go to afternooon games and hit the scalpers, myself.

Signage. Something million a year. Imagine there will be ALOT of advertising in the concourse, stadium and such. Less promotions, as no need to give things away in 2010 to egt fans to buy. We might start to see more things like biobbleheads exclusively tied into season ticket packages.

Concessions. Major league revenue. Any parking splits?

Be intersting to see HOW MANY new uniforms (with patch) sell. This is more a part of major league properties, I believe, who take their own cut, as do any players that have their names on the back.

If the viewership increases, the Twins make more money on the TV end via advertising. I think radio has to pay a flat fee to air the Twins as well as an advertising split. More wins = more listeners/viewers and higher or mroe ads.

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by rosterman on Nov 22, 2009 7:22 PM EST up reply actions 0 recs

revenue sharing recieved

2002 12M
2003 17M
2005 22M

http://bizofbaseball.com/index.php?option=com_content&view=article&id=3760&Itemid=178

by Jon Kammerer on Nov 22, 2009 5:27 PM EST reply actions 0 recs

Calvin Griffith days

The good ol’ days when Uncle Calvin didn’t want to pay any player more than he paid himself, or most family members.

How does a $1 million a year manager tell a $10+ million a year player what to do?

Visit www.TwinsCards.com and check out "rosters" to see my collection!

by rosterman on Nov 24, 2009 6:44 PM EST reply actions 0 recs

Easy

The $1M a year manager fills out the lineup card. As long as his management has his back, the $10M a year player will sit.

by Adam Peterson on Nov 24, 2009 9:10 PM EST up reply actions 0 recs

Expenses

I think we are all vastly underestimating increased operating expenses. Sure, the new stadium that belongs solely to the Twins will bring in more revenues. But there will also be more expenses related to those revenues such as groundskeeping, maintenance, and many other expenses that were implicit in the Metrodome rent. Not all of the increased revenue goes to the bottom line.

I would be shocked if our payroll was much higher than $75M, which is still a 15% jump. I think 20% increase ($78M) is probably the max increase we could afford. The team that is probably the best proxy as far as size of market, stadium, etc, would probably be the San Diego Padres.

by rencito on Nov 28, 2009 4:27 PM EST reply actions 0 recs

We're already at $83M today

if I recall correctly, so there’s a pretty good chance we end up of $75M. I agree, we have to consider that not all of the increased revenue goes directly to the bottom line, but I suspect the revenue increase will far outweigh increased operating expenses in the new stadium. Debt servicing is another “hidden” expense we have to consider.

by Adam Peterson on Nov 29, 2009 7:42 AM EST up reply actions 0 recs