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-   -   Nashville Predators-The Business Side (http://hfboards.hockeysfuture.com/showthread.php?t=1546839)

The PH Factor 11-26-2013 07:51 PM

Nashville Predators-The Business Side
 
Thought it might be interesting to some folks on here to have a thread to discuss the business side of the Preds/Powers Management.

Came across this interesting article in Forbes the other day.

http://www.forbes.com/sites/darrenhe...me-no-1-venue/

Gives some very interesting insights into the Powers-Predators business model and aspirations.

Another related point, Forbes just came out with their team valuations and show the Preds with an operating loss of $800,000 for 2012-13. Their method for reaching this number isn't very clear and tbh I find it hard to believe that the 7th most active Arena in the USA doesn't at least offset any hockey losses via concert revenues (Forbes claims to use arena management contracts alongside hockey operations statements).

Last food for thought, Henry mentioned a couple months back that the Preds were considering bidding to be operator of the proposed outdoor arena at the old Thermal Transfer site downtown. Would be a very intriguing addition to their business and something to keep an eye peeled about.

101st_fan 11-26-2013 08:21 PM

Forbes numbers and Sports Authority audited numbers for the Preds haven't matched ever that I've seen. The team will lose money on the ice and look to balance it out through off ice events using the technically separate wing of the umbrella corporation. We will never know the true revenues of the Powers wing of the corporation and without spending hours pouring through the annually required audited financial reports the team provides to the Sports Authority there is little chance of gleaning much real information on how well the business model is working.

I'm done scouring paid/announced attendance, profit reports, etc. I did enough looking at that information in the days of the firesale, "ask", and new lease agreement.

skydog71 11-27-2013 02:51 PM

Just because the Predators are reporting a loss doesn't necessarily mean that the owners are losing money. For example, if the owners are showing a loss of $800,000, but collectively gave clients of their other businesses $900,000 worth of free tickets/suites/etc, then they technically made a profit $100,000. Granted, it's not quite that simple... but sports franchises are oftentimes "loss leaders" for other business ventures.

And here's another angle. If you had a team that was worth $200 million in 2012, lost $800,000 in 2012-13, and then had a value of $205 million for 2013 --- well you just spent $800,000 to get $5,000,000. Or a net gain of $4.2 million that you'll get on the backend when you sell the team.

dulzhok 11-27-2013 05:03 PM

Quote:

Originally Posted by skydog71 (Post 75111639)
Just because the Predators are reporting a loss doesn't necessarily mean that the owners are losing money. For example, if the owners are showing a loss of $800,000, but collectively gave clients of their other businesses $900,000 worth of free tickets/suites/etc, then they technically made a profit $100,000. Granted, it's not quite that simple... but sports franchises are oftentimes "loss leaders" for other business ventures.

And here's another angle. If you had a team that was worth $200 million in 2012, lost $800,000 in 2012-13, and then had a value of $205 million for 2013 --- well you just spent $800,000 to get $5,000,000. Or a net gain of $4.2 million that you'll get on the backend when you sell the team.

I don't think you can justify arbitrary franchise values as them gaining money. At least, I sure hope the owners don't see it that way (would mean they are thinking of selling).

But everyone is right, these numbers mean absolutely nothing and can be tinkered to no end. The least of which, do owner's take a salary? I'm sure they see their time as valuable, and they each could be a taking a million+ in salary.

The big unknown is just how much owners get from off ice events. I'm sure there's some insight to this, but I don't know it.

But we can probably safely say based off our team salary and hockey revenue, the Predators by themselves are losing quite a bit of money. But they offset it to some degree with revenue sharing checks, off-ice events, and tax payer subsidies. What degree?... I don't know.


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