Lockout Discussion Thread 4.0
View Single Post
12-10-2012, 12:41 AM
Join Date: Jul 2007
Originally Posted by
The 50-50 is completely arbitrary. It's just another number between 0 and 100, and many people on this thread have posted counterexamples. For some businesses labour get a lot less than 50%, other times, they get a lot more. For the NHL, all we know is the free market rate: 76%.
It's not as though the owners are getting a 50% profit margin. They will not be getting a 50% profit margin, and to my knowledge no significant industries do. With their 50% they still need to pay for a lot of expenses such as scouts, GMs, et cetera. It's not a relevant number because we have very little idea what the pie actually looks like. We also don't know the full list of expenses subtracted from HRR.
The true profit margin for the NHL last year was 4.2%: 140 million in operating income out of 3.3 billion dollars in revenue. I think that's about average. If player salaries were to drop from 57% to 50%, and everything else remained fixed, the profit margin would rise to 11.2%, which is extremely high. However, it wouldn't go that high, I suspect lower salaries for players would lead to higher salaries for scouts.
Some examples. Apple Computers has profit margins of 35%. Wal Mart has profit margins of 6%.
I'm pretty sure the dispute is over 50% of the profits no? It certainly isn't 50% of the revenues.
And you're right this negotiation is simply all about what the players are going to give up this time around. They certainly aren't winning anything here. So for Bettman to sit there and talk about the league 'giving, giving, giving' I'm not sure what he's talking about. They aren't giving anything here, it's just that they may be taking away less than they otherwise would.
And his whole position of 'we offered them a final contract and they tried to negotiate off of it so we walked away' is ridiculous. That's not how negotiations work, certainly not if you want an expedient solution.
I will repeat what I said earlier, he needs to be far less of a hard-ass if he wants to avoid this kind of stuff. He was a hard-ass at the beginning and he's being a hard-ass now. Won't surprise me if we lose the season (again.)
View Public Profile
Lafleurs Guy's albums
Find More Posts by Lafleurs Guy