May 22, 2009

Financial Portrait of Phoenix - From the Rink

A portrait of a team on the brink: The Coyotes' revenues revealed

This is a very good breakdown of the Phoenix Coyotes' financial situation. And, frankly, it gives you a great idea as to how NHL teams generally work. It doesn't look very good, does it? It's too bad that sports team owners don't seem to have a lot of practical business sense when it comes to running things.

I guess that probably comes from hiring former players instead of hiring people with job experience. I'm not saying athletes are stupid at all, just inexperienced. And we've all see how that's turned out in Tampa Bay this last season. Ultimately, running a team is like running a business - you should only hire the people who qualify for the position.

You should not hire friends and family, and definitely not retired athletes simply out of gratitude or nostalgia. The hockey teams that are the most successful are the teams that have experienced people running them. And most of those people are not former NHLers. I have no problem with former athletes running things as long as they work their way up to that position just like anyone else.

Being granted a co-GM position, such as Brett Hull was upon his retirement, was a bad move in my opinion. And going from player to head coach like Gretzky did? Also another bad move. Even Patrick Roy had enough sense to start in junior hockey before trying to make the jump as an NHL coach. And while Steve Yzerman might've gone directly to the front office upon retirement, he's still in only a supporting role as Vice President of the Detroit Red Wings. Although, I do sort of question his appointment as Executive Director of Team Canada's Olympic team with him only being two years out of the game.

Regardless of how people think of sports, it still is a business - money is what makes it work, or not. And as with any business, the bottom line is that you have to earn more than you spend. It doesn't all come down to player salaries versus ticket sales, tho. Operating expenses are much more involved than that.

However, it really does come down to wins and tickets - at least here in the US. If the team has a losing season, then a team loses money. Americans like watching winners, after all. They don't want to blow their money on watching a losing team, particularly when tickets are so expensive. Unless they're there to watch the visiting team, that is.

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