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mightymoose

CPL economics

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On 7/28/2018 at 12:36 AM, Tigers said:

Air transat is cover all the Wolfpack flights, so something like that isn't outside the realm of possibility.

Do they also cover the visiting teams' flight costs? Doesn't seem too fair to the other sides in the league, if they have to fly transatlantic.

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On 7/26/2018 at 2:42 AM, Xavier said:

It's still possible the Whitecaps might create some kind of deal with a CPL team to loan out young Canadians for playing time at a possible higher level than USL. Not sure if the league will allow it, but Victoria and Calgary were both considered.

No type of official deal like an affiliate is needed or should be allowed as CPL is D1 not minor league like USL is to MLS

As for loans, Caps will likely have a few and could concentrate them on one CPL club like they did with NASL's FC Edmonton over the years.

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16 minutes ago, Blackjack15 said:

Since the conversations the CPL has had with owners has been said that “expect to lose money in the first few years”

Whats the Canadian Soccer Business (CSB) role again? 

As far as I understand, they will represent Canada soccer and CPL in media rights deals. Basically adds some professionalism to the negotiations for the CSA in exchange for a cut of the revenue 

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5 hours ago, Blackjack15 said:

 

Whats the Canadian Soccer Business (CSB) role again? 

I'd like to see more info on it too

If I'm interpreting what some of the owners and people involved have said about it correctly, it's actually a big deal.  CSB is in charge of CPL and CSA (ie. national teams) media properties. Thus it gives CPL team owners a stake in CMNT revenue. Think World Cup 2026.  It really helps solidify the business case for each team. 

Anyone : please correct me or shed more light on this.

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The CWNT friendly against Germany at THF in Hamilton is probably more the shape of things to come on that over the next few years as they are more marketable than the CMNT at the moment, unfortunately, and the appearance feels for the top teams are not as high. Marketing rights to the Canadian Championship (Voyageurs Cup) and naming rights on stadiums were also involved. 

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Some info from England.

Deloitte produces an annual report on English football finances. This 2018 report is for the 2016/17 season.

There is an interesting grahic near the top that appears to show TOTAL revenue and wage costs for each division (in GBP of course). So divide by 24 to get average per team.

Championship: £720m total ($52.5m/team)

      Wages: £712m total ($51.9m/team)

League 1: £146m total ($10.6m/team)

      Wages: £123m total ($9.0m/team)

League 2: £91m total ($6.6m/team)

      Wages: £65m total ($4.7m/team)

https://www2.deloitte.com/uk/en/pages/sports-business-group/articles/annual-review-of-football-finance.html

Edited by dsqpr

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5 hours ago, dsqpr said:

Some info from England.

Deloitte produces an annual report on English football finances. This 2018 report is for the 2016/17 season.

There is an interesting grahic near the top that appears to show TOTAL revenue and wage costs for each division (in GBP of course). So divide by 24 to get average per team.

Championship: £720m total ($52.5m/team)

      Wages: £712m total ($51.9m/team)

League 1: £146m total ($10.6m/team)

      Wages: £123m total ($9.0m/team)

League 2: £91m total ($6.6m/team)

      Wages: £65m total ($4.7m/team)

https://www2.deloitte.com/uk/en/pages/sports-business-group/articles/annual-review-of-football-finance.html

So we would be near or slightly below League Two, except one important point. A large part of the value of a League Two team is the potential to promote, and promotion into higher value raises the speculative value of where you sit, however modest. 

It also happens to be the case that there are teams that do this, so it is not a pipe dream. 

You also have FA Cup tv money, I used to get FA cup matches here in Spain in a package, and you'd see those lower tier teams, it was great. They benefitted, of course. In Canada, there is only a vague Voyageurs Cup run, which would not really raise value of a club.

For CPL, the value is what it is, and their is no speculative value that can be added or played with. So we are League Two, but with few if any of the potential upsides. 

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So much good discussion going on in the CPL General thread that I hate for it to get buried in that 374 page monster, so let's continue it here.

It is certainly true that the CPL has been reticent on financial details. My theory (and others') is that the numbers are not impressive when compared to other pro leagues like the NHL or even the CFL. But that is to be expected for a start up league. What good businessman would throw wads of cash at such an unknown commodity?

So, they have a choice: publish the numbers and supply their critics with real ammunition, or don't publish the numbers and leave their reticence as their critics' only target. Upon reflection, they are making the right choice.

Curious as I am, let's just get this thing going and not worry too much that we don't have every number to hold up to scrutiny.

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9 minutes ago, dsqpr said:

It is certainly true that the CPL has been reticent on financial details. My theory (and others') is that the numbers are not impressive when compared to other pro leagues like the NHL or even the CFL. But that is to be expected for a start up league. What good businessman would throw wads of cash at such an unknown commodity?

 

https://www.cbssports.com/wwe/news/vince-mcmahon-reportedly-expects-to-spend-500-million-on-xfl-in-first-three-years/

https://www.nbcsports.com/video/aaf-chairman-tom-dundon-explains-why-he-invested-250m-league

https://www.forbes.com/sites/mikeozanian/2017/06/13/arizona-coyotes-owner-andrew-barroway-buys-out-partners-for-240-million/#62162986178b

I mean, we could go on...

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14 minutes ago, dsqpr said:

So much good discussion going on in the CPL General thread that I hate for it to get buried in that 374 page monster, so let's continue it here.

It is certainly true that the CPL has been reticent on financial details. My theory (and others') is that the numbers are not impressive when compared to other pro leagues like the NHL or even the CFL. But that is to be expected for a start up league. What good businessman would throw wads of cash at such an unknown commodity?

So, they have a choice: publish the numbers and supply their critics with real ammunition, or don't publish the numbers and leave their reticence as their critics' only target. Upon reflection, they are making the right choice.

Curious as I am, let's just get this thing going and not worry too much that we don't have every number to hold up to scrutiny.

Now, to be fair you could definitely be right: the numbers aren't as impressive as some of the other leagues and they'd rather not divulge that.  But then they shouldn't have their media mouth pieces like Peter Schaad talking about how the numbers are "jaw dropping" and bragging about how great they are.

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2 hours ago, Watchmen said:

Now, to be fair you could definitely be right: the numbers aren't as impressive as some of the other leagues and they'd rather not divulge that.  But then they shouldn't have their media mouth pieces like Peter Schaad talking about how the numbers are "jaw dropping" and bragging about how great they are.

He said the numbers were "jaw dropping for a start up league". That qualifier is important. It is also important that this is an opinion, not a fact. And I have no idea why you think the CPL media guy should not be expressing an opinion on the numbers, even if the exact figures are not released.

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On 7/26/2018 at 4:36 AM, mightymoose said:

I'm sure you are right, and of course there are many more wealthy people in Canada than in Scandinavia, who can invest private money.

I'm thinking that the ultimate goal has to be self-sufficiency. Not a Russian or Asian model, where rich people pump their private money into the clubs, in order for them to function. When the owner loses interest or runs out of cash, the club folds. This is why I have a hard time seeing how a team from some obscure "suburb" could make it in the long run in an expensive set up.

The places you mention I completely understand. The soccer teams become the main pro teams in those cities, which adds a lot to the potential.

Just a quick clarification, York Region isn’t an obscure suburb, it’s a group of 9 communities that together have over 1.2 million people. 

I think York 9 FC can work for 3 reasons:

1) Some (enough) of the hardcore fans of Canadian soccer are disenchanted with MLS, and / or view the CPL as way more important to them, so they’ll support York 9. (I’m in that group). 

2) The Greater Toronto area is massive. It can take hours to cross by car, and it has close to 8 Million people in and around it. It certainly contains enough people to support a second club, especially if that club only needs a few thousand supporters to attend games in order to make money. 

3) For me, and the other many suburban and exurban based fans, going to a TFC game takes 1.5 hours to get to the stadium. It takes another 1.5 to get back. I have to pay a fortune for parking downtown, and the tickets to see TFC aren’t cheap. So, in addition to being closer (20 minutes from my house) and cheaper (about half the price for a ticket) York 9 FC is Canadian. It’ll play against other Canadian clubs which is far more interesting than a league match against someone like Colorado. 

 

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7 hours ago, dsqpr said:

He said the numbers were "jaw dropping for a start up league". That qualifier is important. It is also important that this is an opinion, not a fact. And I have no idea why you think the CPL media guy should not be expressing an opinion on the numbers, even if the exact figures are not released.

I'm saying that if they are indeed jaw dropping for a start up league, then go ahead and release them.  Let us make up our own minds.  That was sort of my point with the CFL reference.  The numbers weren't that big compared to every other league but we were all capable of seeing that it was a big deal for the CFL.

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I thought this article from Oct 2017 was interesting (link below). Seems as though CPL teams will be spending more on player wages, even in year one:

Annual participation fees of $110,000 were significantly lower than the same fees for NASL play in 2016 — the USL’s critical mass of clubs allowed individual fees to be lower to fund the entire league.

...

Per documentation, the USL expects annual player salaries to be between $200,000 and $400,000. Prima facie, this is troubling. If teams have 20 players, that would mean very low wages for many players. It has to be stated that USL salaries may have increased since being awarded DII status. As a comparison, documentation obtained by Soc Takes shows that Rayo OKC — an NASL team — anticipated spending $530,000 on salaries last season, whereas Brian Helmick of the San Francisco Deltas said the team expected to spend $1.2 million on players. Both Miami FC and the New York Cosmos currently have a player budget higher than the Deltas’.

https://www.soctakes.com/2017/10/31/usl-franchise-agreement/

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Bumping this thread as the discussion is being renewed.

Sad little North Star Shield, which probably cost all of fifty bucks, and rumoured move to restrict the number of older foreign players, possibly with the thought that only younger players are ever likely to yield a transfer fee, raise cause for concern.

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I think the older import thing is more to keep competitive balance. A team in the summer transfer window could get a couple vets looking for a pit stop in Canada and run away with things. I'm surprised people are so in favour of a strict salary cap but are acting like this rule is the devil

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