CPL new teams speculation

[Complete Homer]

12 minutes ago, harrycoyster said:

Jake Edwards said a few weeks ago that the USL only had a few teams that were in the black but that the majority of teams were sustainable. If you take "a few" to mean three and a majority to mean 60%, you're looking at ~8000 fans to break even/profit and ~4000 to sustain at USL standards. Obviously that is a lot of speculation and there are a ton of other factors, but it's still interesting information.

Good point 

It's also worth noting that there is a pretty wide range of player salary spending in USL. I know we touched on this before, but Krishnayer had a few interesting snippets a while back. Lots of teams were apparently paying players in the 1000 dollar per month range while others were going out and spending 50k+ for bench players. Might be hard to pin down what kind of attendance is a break even point for a middle of the road USL team with a moving target like that. I'd assume the big spenders would be the ones gunning for MLS expansion, but hard to say

[mpg_29]

It's funny that you hear arguments that the salaries have to be a certain standard and also that this league is should be mostly helping young Canadian players. I think both are a bit at odds with each other.

I think a relatively low salary cap (500K) would not only be advantageous for league sustainability but would also ensure a large percentage of the player pool is young Canadian players by default from a salary market point of view.

Unless you think trying to get 5000 fans every game to pay a quota'd  22 yr old Canadian player 50K-75K for 6 months is smart either from an league sustainability point of view  or soccer point of view.

 

Edited December 9, 2017 by mpg_29

[harrycoyster]

8 minutes ago, mpg_29 said:

It's funny that you hear arguments that the salaries have to be a certain standard and also that this league is should be mostly helping young Canadian players. I think both are a bit at odds with each other.

I think a relatively low salary cap (500K) would not only be advantageous for league sustainability but would also ensure a large percentage of the player pool is young Canadian players by default from a salary market point of view.

Unless you think trying to get 5000 fans every game to pay a quota'd  22 yr old Canadian player 50K-75K for 6 months playing soccer is smart either from an league sustainability point of view  or soccer point of view.

 

If you go back to the summer in this thread, there was 100s of posts of discussion on this issue. This forum is about evenly split on the Canadian v. Quality and Comfortable salary v. Worth arguments. Not really worth arguing again until the league tips it's hand as to roster direction.

Edited December 9, 2017 by harrycoyster

[Complete Homer]

1 hour ago, mpg_29 said:

It's funny that you hear arguments that the salaries have to be a certain standard and also that this league is should be mostly helping young Canadian players. I think both are a bit at odds with each other.

I think a relatively low salary cap (500K) would not only be advantageous for league sustainability but would also ensure a large percentage of the player pool is young Canadian players by default from a salary market point of view.

Unless you think trying to get 5000 fans every game to pay a quota'd  22 yr old Canadian player 50K-75K for 6 months playing soccer is smart either from an league sustainability point of view  or soccer point of view.

 

No one is saying a depth player should be making 50-75k, you wouldn't even be able to pull that off with the rumoured 1.5M cap. But there is something to be said for creating a demand for Canadians. 

There's next to no demand globally for Canadian players. Aside from a couple PR signings, even Canadian MLS clubs don't have much incentive to sign Canadians. So why would a talented Canadian stick with soccer instead of becoming an engineer or an accountant? There's huge opportunity costs for a young person with options to pursue pro sports, with next to no chance of reasonable success, and Canadian soccer is currently one of the worst bets of all

Opening up 100 protected spots with a living wage for Canadian players shifts the formula a bit. Maybe not a lot, but probably enough that a kid passing up university to take a swing at a pro career isnt equivalent to trying to win the lottery. That has a knock-on effect where more people want to seek out high quality training to compete for those spots, maybe leading to a few more Sigma-esque academies 

Edited December 9, 2017 by Complete Homer

[mpg_29]

4 minutes ago, Complete Homer said:

No one is saying a depth player should be making 50-75k, you wouldn't even be able to pull that off with the rumoured 1.5M cap. But there is something to be said for creating a demand for Canadians. 

There's next to no demand globally for Canadian players. Aside from a couple PR signings, even Canadian MLS clubs don't have much incentive to sign Canadians. So why would a talented Canadian stick with soccer instead of becoming an engineer or an accountant? There's huge opportunity costs for a young person with options to pursue pro sports, with next to no chance of reasonable success, and Canadian soccer is currently one of the worst bets of all

Opening up 100 protected spots with a living wage for Canadian players shifts the formula a bit. Maybe not a lot, but probably enough that a kid passing up university to take a swing at a pro career isnt equivalent to trying to win the lottery. That has a knick-knacks effect where more people want to seek out high quality training to compete for those spots, maybe leading to a few more Sigma-esque academies 

Unfortunately this is too idealistic for what the market is actually going to deliver in my opinion. You can't just manufacture certain economic levels/standards out of thin air...

The ironic thing is I think the CPL market will actually line up pretty well to what the majority of young Canadian players are worth...it's just not anywhere near the rumoured numbers I hear from this league and from what people on here are suspecting.

[harrycoyster]

11 minutes ago, Complete Homer said:

No one is saying a depth player should be making 50-75k, you wouldn't even be able to pull that off with the rumoured 1.5M cap. But there is something to be said for creating a demand for Canadians. 

There's next to no demand globally for Canadian players. Aside from a couple PR signings, even Canadian MLS clubs don't have much incentive to sign Canadians. So why would a talented Canadian stick with soccer instead of becoming an engineer or an accountant? There's huge opportunity costs for a young person with options to pursue pro sports, with next to no chance of reasonable success, and Canadian soccer is currently one of the worst bets of all

Opening up 100 protected spots with a living wage for Canadian players shifts the formula a bit. Maybe not a lot, but probably enough that a kid passing up university to take a swing at a pro career isnt equivalent to trying to win the lottery. That has a knick-knacks effect where more people want to seek out high quality training to compete for those spots, maybe leading to a few more Sigma-esque academies 

While I agree with you, I don't see why that has to be an immediate priority. Let the back-end of CPL rosters get paid what they'd be paid in USL and make a 45k minimum salary a priority by Year 5 when CPL is stable.

[Complete Homer]

11 minutes ago, harrycoyster said:

While I agree with you, I don't see why that has to be an immediate priority. Let the back-end of CPL rosters get paid what they'd be paid in USL and make a 45k minimum salary a priority by Year 5 when CPL is stable.

That's pretty reasonable, though personally I think a 30k minimum (maybe adjusted depending on market) is probably still relatively generous for depth players if there's a 25ish person roster. These guys are probably being drawn from L1O/PLSQ/PDL setups, 30k would still change their careers and give a reason for high performance amateurs to get noticed in those leagues

[Complete Homer]

41 minutes ago, mpg_29 said:

Unfortunately this is too idealistic for what the market is actually going to deliver in my opinion. You can't just manufacture certain economic levels/standards out of thin air...

The ironic thing is I think the CPL market will actually line up pretty well to what the majority of young Canadian players are worth...it's just not anywhere near the rumoured numbers I hear from this league and from what people on here are suspecting.

That's exactly what foreign player limits do everywhere, they create artificial market conditions that overpay domestic players for the sake of incentivizing the creation and improvement of development pathways. It doesn't change anything overnight, but I'd say all you have to do is look at the US to see what overpaying NCAA grads in the 90s helped create a couple decades down the road

[mpg_29]

12 minutes ago, Complete Homer said:

That's exactly what foreign player limits do everywhere, they create artificial market conditions that overpay domestic players for the sake of incentivizing the creation and improvement of development pathways. It doesn't change anything overnight, but I'd say all you have to do is look at the US to see what overpaying NCAA grads in the 90s helped create a couple decades down the road

Yeah it's similar type of vodoo economics that gives us a $4 carton of milk...

But that's not really what my point was. My point was that you can't manufacture the demand for the product to meet the operational expenses (including salary levels).  That demand is organic...and I'm not sure it's close to ~5000 fans per game.

Edited December 9, 2017 by mpg_29

[Macksam]

8 hours ago, grasshopper1917 said:

I think to put things in perspective the Canadian teams in the indoor lacrosse league draw on average more then 9000 fans a game. I dont think drawing 4000 for soccer is all that 'scarry'.

I dont want to sound cocky but with proper marketing, pricing and creating a fun game day experience it really shouldn't be all that difficult over 15-20 home dates. 

Of course one can not just assume the league will do proper marketing and create the atmosphere. That will take work but with the right people in place it is certainly doable. 

I agree.

2 hours ago, mpg_29 said:

That demand is organic...and I'm not sure it's close to ~5000 fans per game.

Depends on the market and how you present it.

What makes you doubtful in general?

Edited December 10, 2017 by Macksam

[grasshopper1917]

Just a random observation. Had a Wanderers event down here in Halifax for MLS cup. The largest sports bar in town was filled with people watching the game today. I figured it may be a quarter filled at best. I think TFC is doing much more to grow the popularity of the game in Canada then some people give credit for.

[dyslexic nam]

Alternative explanation - TFC is reaping the benefit of the growth of soccer's popularity in Canada, which was underway long before TFC.

[Bison44]

It doesnt hurt that the sports channels show MLS now.  Before the CDN teams it was "super soccer saturday" and some champions league highlights if you were lucky!!  The MLS teams and any growth in soccer popularity are feeding off each other. Yet to see any critical mass built up for CPL or player development, but we can always hope.  After all I'm here because of the old NASL and Winnipeg Fury.

[matty]

7 hours ago, mpg_29 said:

It's funny that you hear arguments that the salaries have to be a certain standard and also that this league is should be mostly helping young Canadian players. I think both are a bit at odds with each other.

I think a relatively low salary cap (500K) would not only be advantageous for league sustainability but would also ensure a large percentage of the player pool is young Canadian players by default from a salary market point of view.

Unless you think trying to get 5000 fans every game to pay a quota'd  22 yr old Canadian player 50K-75K for 6 months is smart either from an league sustainability point of view  or soccer point of view.

 

If the cap was the rumoured $1.5m about $1m would be spent on the starting XI. There's no way rookie canadians make more than $25k

[matty]

I want to just make a point here for @mpg_29: if the league is poor no one will care. The idea that spending low will secure survival could actually cause people to lose interest especially in a market like Hamilton. The on field porduct needs to be skilled enough for hardcores and entertaining for casuals. Spending more might be needed to survive.

I personally think we'll see a $750k-1m cap (because people are willing to build stadiums and travel across the country) with an increase every few seasons to reach $1.5 with maybe a DP option and CanMNT player slots that see the teams sign a player for like $100k+ but only take a $75k cap hit.

Edited December 10, 2017 by matty

[Complete Homer]

59 minutes ago, matty said:

I want to just make a point here for @mpg_29: if the league is poor no one will care. The idea that spending low will secure survival could actually cause people to lose interest especially in a market like Hamilton. The on field porduct needs to be skilled enough for hardcores and entertaining for casuals. Spending more might be needed to survive.

Exactly. Imagine you are a venture capitalist investing in this league. You expect to lose 2 million a year while the league grows. What's a greater risk, the extra 500k in losses or torpedoing the project from the outset with amateur quality? 

I'm not saying it will be a 1.5M cap, I'm just saying they'll probably find a sweet spot where they are not losing money hand over fist while they build the fanbase 

[mpg_29]

10 hours ago, Complete Homer said:

Exactly. Imagine you are a venture capitalist investing in this league. You expect to lose 2 million a year while the league grows. What's a greater risk, the extra 500k in losses or torpedoing the project from the outset with amateur quality? 

I'm not saying it will be a 1.5M cap, I'm just saying they'll probably find a sweet spot where they are not losing money hand over fist while they build the fanbase 

It's hard to take you're concerns about "amateur quality" seriously when you are also advocating for foreign player limits to artificially inflate domestic players worth...the two are at odds. 

Not to mention I think owners losing $2 million/yr is a more significant threat to league sustainability than the perception of player quality difference at this level.

[Futballer]

12 minutes ago, mpg_29 said:

It's hard to take you're concerns about "amateur quality" seriously when you are also advocating for foreign player limits to artificially inflate domestic players worth...the two are at odds. 

Not to mention I think owners losing $2 million/yr is a more significant threat to league sustainability than the perception of player quality difference at this level.

Guys the  Premier League Canada Or  Canada Premier League will not be in the RED as forecast  by those who are running the promo at the moment.

The CPL or CanPL  or PLC  will always be in the Black  according to  common accounting  phrase.

The CPL will  achieve break even at  least For our investors,  

[BringBackTheBlizzard]

25 minutes ago, mpg_29 said:

...Not to mention I think owners losing $2 million/yr is a more significant threat to league sustainability than the perception of player quality difference at this level.

New investors in pro soccer often talk a good game about being willing to do that sort of thing in advance, but many quickly pull the plug when faced with the reality and it only takes a couple of those to potentially sink the whole project when franchise numbers are as tight as they are with CanPL. The problem is finding an economic model that fits the Ticats apparent desire to be viewed as being reasonably competitive with TFC rather than being a farm league that is a clear step down and also what is likely to be sustainable in smaller cities like Halifax and Saskatoon.

Edited December 10, 2017 by BringBackTheBlizzard

[Futballer]

15 minutes ago, BringBackTheBlizzard said:

New investors in pro soccer often talk a good game about being willing to do that sort of thing in advance, but many quickly pull the plug when faced with the reality and it only takes a couple of those to potentially sink the whole project when franchise numbers are as tight as they are with CanPL. The problem is finding an economic model that fits the Ticats apparent desire to be viewed as being reasonably competitive with TFC rather than being a farm league that is a clear step down and also what is likely to be sustainable in smaller cities like Halifax and Saskatoon.

We have already address such issues within the Business plan of the Can PL and these instances wont take place as the plan provides a safety net for investors to know their  investment will  achieve RETURNS.  

[Complete Homer]

1 hour ago, mpg_29 said:

It's hard to take you're concerns about "amateur quality" seriously when you are also advocating for foreign player limits to artificially inflate domestic players worth...the two are at odds. 

Not to mention I think owners losing $2 million/yr is a more significant threat to league sustainability than the perception of player quality difference at this level.

If you take a look at the losses of most soccer leagues in North America, MLS included until recently, losing two million a year initially is pretty reasonable.

You're not really thinking in terms of someone with a startup, you're thinking in terms of regular Joes with bills to pay on a static income. If you're breaking even the first year as a startup, you probably aren't expanding your business as fast as you should be. This is why vetting ownership is so important, even to the point of delays. Better to have owners both willing and able to lose that kind of money than have someone who will pull out after a couple seasons. 

As for the earlier part of your question, no, they're not contradictory. Creating an economic demand for young Canadians is about improving the league by expanding the player pool in the decades ahead, while having a reasonable cap is about having sufficient quality to keep people tuned in from day 1. There's nothing contradictory about having a high enough cap to attract decent NASL/USL players as starters (both Canadian and international) while also ensuring that the squad's depth gets filled out by Canadians by necessity with roster restrictions.

This isn't an abnormal concept... look to MLS if you want. They have forced themselves to expand the US player pool by having foreign player restrictions, but also use internationals to improve the quality of play. Or look to almost every league in the world where similar rules are in place. 

And really, we are quibbling over minor details. You say 500k is the limit. I'm saying something closer to a million. In the overall cost structure of operating a club, that probably isn't going to be the make or break cost figure for an owner, but it might be the difference between a watchable product and an unwatchable product

Edit:

And to be clear, I'm not saying 500k is necessarily unwatchable, but it's a 20k average salary. Those aren't full time positions in most cities, I think the biggest change in quality is seen between full time pros and players who can't train during the day because they are at their day job

My point is, if you're willing and able to try to make this kind of investment, you aren't trying to just get by with minimal losses and small crowds. You are looking to find the point where you can present a polished product that will turn games into well known, desirable events, and turn the project into a successful part of their portfolio. Maybe you can do that on a 500k salary cap, I just have a hard time seeing them achieving a polished product with semi-pro players

Edited December 10, 2017 by Complete Homer

[Initial B]

Here's what I see as a decent payscale for a club in CPL

1 x $150K (Marquee player)

4 x $100K  (Team spine players)

6 x $80K (Main starting players)

4 x $60K (Key sub players)

4 x $50K (Secondary sub players)

7 x $40K (U23 Development players)

$1,750K for 26 players TOTAL

For most starting players and key subs, that is enough of a salary to live comfortably in any Canadian City save the big 3. In a lot of the smaller cities, even the Developmental players would be able to get by. Operating expenses including support personnel, air travel, accommodations, and home stadium operations costs could add another $2 million to the annual costs to the club for a 28-game season. Does $4 million per year sound out of place for running a club? Multiply by 8-12 teams and add advertising and Front Office salaries to the mix and that comes out to $40-50 million per year to run the CPL. 

If each team can sell 5000 tickets per game at $25 per ticket for 14 home games, that would be $1,750K in revenues (not including concession sales and merchandise). If the league could raise another $20-30 million in advertising fees and TV contracts, then the league could become sustainable. 

 

 

Edited December 18, 2017 by Initial B

[PJSweet]

Here's my question to everyone. If you have a league with 10 teams, and every team is divided into 2 division: 5 in the East and 5 in the West. How many games (home and away) will every team play? Can I also have the answer for a league with 12 teams as well? Please do the math for me?

Edited December 18, 2017 by PJSweet

[harrycoyster]

1 hour ago, Initial B said:

Does $4 million per year sound out of place for running a club?

Given that the average NASL club lost $5 million USD a season in 2016 and the Caps lost ~$5 million in USL last year, I'd imagine the number is a couple million higher.

[Initial B]

I've spent many hours calculating scenarios for that.

For a 10-team league, I see them playing 10 games (home-and-away) against the teams in the opposing conference and the remaining 18 games against in-conference teams (2x home-and-away plus 2 extra games against closest rivals).

For a 12-team league, it's 12 games (home-and-away) against opposing conference and 16 games (3 games per opponent + 1 extra against closest rival) in-conference.

<Edit: At 15 teams, it's just home and away against every other team in the league.>

<Edit 2: And if we ever get to 20 teams, it will be scheduled as was MLS circa 2016.>

Edited December 18, 2017 by Initial B