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The good news is that the Green Bay Packers churned out a profit of $21 million in the fiscal year ending in 2007.
The bad news is that represents a 37 percent drop over the prior fiscal year.
We had a good year,” Packers President Mark Murphy said. ”But not as strong as you might have anticipated.”
One problem is that player costs shot from $110 million to $124 million, thanks to an ever-increasing salary cap. “Player expenses are increasing at a more rapid rate, and that concerns us,” team treasurer Larry Weyers said.
The Packers are the only team whose finances are an open book, given that they are publicly owned. And this evidence supports the claim of the NFL owners that changes must be made to a system that pays the players 59 cents of every dollar generated by the business.
But, surely, it won’t be enough to persuade the union to concede the point. NFLPA Executive Director Gene Upshaw wants the league to open its books completely. The league has refused.
It could lead to a work stoppage, in time. The Packers are prepared, via a $127 million “franchise preservation fund.”
Hopefully, they won’t need to use it.
June 22nd, 2008 at 4:47 pm
I’ve been reduced to following only football and golf due to greed and asshole players. Upshaw is going to ruin football too.
What’s going on in the world of chess these days?
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Rating: 2.4 / 5 with 5 rating(s)
June 22nd, 2008 at 5:02 pm
Yeah, that’s really sad that the owners are paying 60% to the only people whose work the viewers are actively tuning in to see. The whole argument reminds me of the Simpsons quote:
Homer: “You’re really rich, Mr. Burns.”
Mr. Burns: “Yes, but I’d give it all up for just a little more.”
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Rating: 3.5 / 5 with 8 rating(s)
June 22nd, 2008 at 5:14 pm
I don’t understand why Upshaw would want to see the league’s books. It’s not as if the public were paying for stadiums or anything via taxes so that these rich owners don’t have to come out of pocket for any expense. It’s not as if the owners would lie about anything….
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Rating: 3 / 5 with 5 rating(s)
June 22nd, 2008 at 5:18 pm
Every intelligent indicator points to a plunge into a bottomless obis for Green Bay. They lost their HOF QB, and now they are stuck with the three year old draft shock and awe of Aaron(wasn’t I supposed to be picked firsr?)Rodgers.
If you thought the books took a hit last year, they will have to tap into that emergency fund even before Brett brings that locker to the landfill, which he is thinking of doing tomorrow.
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Rating: 1.9 / 5 with 9 rating(s)
June 22nd, 2008 at 5:35 pm
Should anyone really feel sorry for an organization that “only” makes a $21 million profit?
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Rating: 2.6 / 5 with 5 rating(s)
June 22nd, 2008 at 5:42 pm
I do not understand how “player costs” increasing is causing the profit to decrease. Player salaries are what the salary cap is for, as the league allots every team the money. And teams cannot go over the cap (supposedly)
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Rating: 1 / 5 with 4 rating(s)
June 22nd, 2008 at 5:59 pm
Wow! There are a lot of idiots on this site posting nonsense and drivel. Plunge into a bottomless obis? The Packers roster is the most stockpiled it has been in years with the youngest team in the league. A-Rod will do just fine. He couldn’t be walking into a better situation. He had 3 years to learn the offense and be mentored by one of the best to play the game. He showed what he could do in the Dallas game which not only builds his confidence but the confidence in his teammates. Can he be Brett Favre? No. But he will be a very good QB. My guess is that he finishes in the top 10 for QB’s next year.
KevinS- The salary cap limits how much you can spend, but the “player costs” referred to are the ridiculous signing bonuses and guaranteed money that has to be paid up front. When you start doling out $30 million dollar signing bonuses, your savings and $$$ disappear in a hurry. What they should really do is fix the draft and eliminate paying HUGE up front money to those players who win the “draft lottery” before they ever take a step out on the field. Guys like Troy Willamson, Cedric Benson and all of the other high first round busts are walking proof.
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Rating: 3 / 5 with 2 rating(s)
June 22nd, 2008 at 6:02 pm
Dear PJW:
May I suggest you turn your attention to horse racing…sure, they sport has it’s problems but at least the athletes (the horses) don’t bith, ask for more money and hire greedy agents…as for chess…is it really any more boring than some of those late season Monday night games?
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June 22nd, 2008 at 6:03 pm
40for60
Plunge for the Packers. They were terrible for almost 3 decades in a row before Favre came around, and yet still had a waiting list in the 10s of thousands for season tickets. The team is even more talented this year, our GM knows what he’s doing, and we have a recently renovated stadium that can host events and take in money 365 days out of the year. I hardly think that means a sudden plunge for the Packers is coming. Remember, this team, despite being in the smallest market (200,000 metro area), is in the top 10-12 in revenue. The Packers aren’t going anywhere.
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Rating: 3 / 5 with 2 rating(s)
June 22nd, 2008 at 6:20 pm
To Michael and others who get starry-eyed by big numbers:
Owning a professional sports franchise is generally a bad investment. If you do a little reading about the economics of sports, you will quickly find that out. There’s an old saying in business: the best way to make a small fortune is to start with a large fortune and then buy a professional sports team.
Total revenue says little of franchises’ profitability and even less of an owners return. With headline inflation at a 20-year high and players’ salaries increasing at an even faster clip, operating costs are increasing at a substantially faster rate then total revenue. Any efforts to combat this (by, say, raising ticket prices) are muted by the CBA’s current language.
The fact that the Packers saw such significant declines in profits should be worrisome for fans of the NFL. The Packers have been one of the more profitable teams in the NFL since the organization and the residents of Brown County funded a renovation of Lambeau Field in 2003. That, combined with the fact that we know that the Packers have been one of the most frugal organizations when it comes player salaries, paints a bleak picture for a number of other teams (namely Buffalo, Jacksonville, Cincinnati, Indianapolis, and Atlanta).
Also, it’s important for people to understand that, at least in the Packers case, the Franchise Preservation Fund is not just money saved for a rainy day. Ted Thompson aka “Scrooge McDuck” doesn’t go swimming in the vault. It serves as a piggy bank for signing bonuses and future stadium repair/renovation - both of which can drain 127 million pretty quickly.
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Rating: 3.65 / 5 with 3 rating(s)
June 22nd, 2008 at 6:26 pm
Let’s keep in mind these are “operating profits.” This most likely wouldn’t include taxes, capital purchases and principle payments on any debt. Given the public-private commingling of funds these days, I’m not sure who paid for the club’s ‘03 stadium remodel. If the Packers did and there is a loan payment associated with that, it would still come out of the annual “operating profit.” Though $21M sounds impressive, it’s really “only” an 8.7 percent margin, and that would make cash flowing a $241M corporation a challenge. However, it is impressive they’ve socked away $127M in a reserve fund.
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Rating: 3 / 5 with 2 rating(s)
June 22nd, 2008 at 6:44 pm
I love it. As a poor old schlock that lives above the poverty line I still can’t afford 2 tickets to a football game (and all the expenses that go with it). And some dumb as dirt shitkicker with a wonderlic score of 6 is making 7 or 8 digits and a team is making only $21 million (I wonder what the taxes are on $21mil, 50 bucks and a donation to the Republican Party?) The NFL is quite literally (yeah, I know it isn’t) “The Goose That Lays The Golden Eggs” and the Union, Owners, Players and Agents have all collectively got the bastard by the throat, squeezing the life out of it in an effort to get it to shit more gold eggs. And the whole time the fan suffers. Eventually they are going to price themselves out of a job, although I’m sure I won’t be around to see it. $21mill—that still frosts my aggots—and lets be clear about this, that it is profit. That is after everyone gets paid, including the fat rats at the top. ” Dammit! where did I put that bottle of scotch?”
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Rating: 3 / 5 with 4 rating(s)
June 22nd, 2008 at 6:58 pm
If any of you bloggers are real football fans, you wouldn’t be ripping on the Packers financial situation. It will be a different NFL world if the CBA breaks down and nobody can afford to keep their own studs besides the 2-3 teams with the biggest payroll. Think outside the box a little bit like Wellington Mara did, and realize that if we want this great league to survive like a good revenue sharing plan has to be put into place.
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Rating: 3 / 5 with 2 rating(s)
June 22nd, 2008 at 7:09 pm
kevinS, a team’s salary cap figure is NOT the total cash paid for player salaries in a given year. Teams cannot go over the cap, but they can pay more cash for player salaries than the stated cap amount…..this is mostly because of big signing bonuses and any other guaranteed amounts that are prorated across future years. Just because a team’s salary cap figure is $100 million doesn’t mean their own player payroll for that year is the same. It’s always more than that.
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Rating: 4 / 5 with 1 rating(s)
June 22nd, 2008 at 7:21 pm
Real football fans shouldn’t be takin smack about this article. Do you want the NFL to turn into the MLB where 2-3 teams can spend all the money. Cmon, think about the league, not just your own team.
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Rating: 3.65 / 5 with 3 rating(s)
June 22nd, 2008 at 7:24 pm
The Packers spent about 30 million buying up the properties surrounding Lambeau Field for “future development” A.K.A. “future revenue streams”. So the 2007 numbers are a bit of a lie.
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Rating: 3.65 / 5 with 3 rating(s)
June 22nd, 2008 at 7:26 pm
I find it hard to believe that the league is hurting. And yet, a few percentage points less for Players would be a drop in the bucket to them, and might go a long way to helping the bottom lines of some of the most marginal teams in the league…
F2B
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Rating: 5 / 5 with 3 rating(s)
June 22nd, 2008 at 7:30 pm
@40for60
Vikings fans, nah maybe a Lions fan. No wait, just a tad to smart for both of those teams. Must be a Bears. Boy could you at least add some intelligent thoughts to the discussion, instead of clear biased hate.
@kevinS
Saying league allots every team the money, or you saying that the league gives each team the entire salary cap? Where there is revenue sharing between the teams, the teams pay for costs out of there revenue. Which is generated by among other ticket sales, items brought from a team proshop, tv deal money, etc…. So if salaries go up quicker than revenues do, it will eat into the profits.
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Rating: 1 / 5 with 1 rating(s)
June 22nd, 2008 at 7:33 pm
I would have thought the Packers would generate more than $21 million annually on beer sales alone.
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Rating: 4.65 / 5 with 3 rating(s)
June 22nd, 2008 at 7:33 pm
Sorry, it just that I am a loser and hate how good the Packers have been for so long.
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Rating: 3 / 5 with 1 rating(s)
June 22nd, 2008 at 8:06 pm
Whatever!
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June 22nd, 2008 at 8:10 pm
kevinS,
The league does not give money to the owners to cover player costs. Sure they get a piece of money from TV and other rights the NFL has sold collectively but the team must have the money to pay the players. The teams that earn more money: because the they have personal seat licenses, naming rights, etc, etc. make more money and have more money to spend.
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Rating: 1 / 5 with 1 rating(s)
June 22nd, 2008 at 8:18 pm
Every intelligent indicator points to a plunge into a bottomless obis for Green Bay
This is rich coming from a closet BIQueens fan. Tell me what you know about NFL QB’s right after the Queens get one. All this gloom an doom coming from MN who lost 4 Superbowls and the last three NFC championships they played, the very last a 41-0 nail biter.
I wouldn’t worry so much about the financial conditions of the Packers and concentrate more on how you are going to pry Childress out of those MENSA meetings to actually coach the Queens this year.
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Rating: 1 / 5 with 4 rating(s)
June 22nd, 2008 at 8:24 pm
As stated, there was a profit made, and the amounts I’m sure for any business, would be greatly appreciate in the current market conditions. With the levy the teams hold on increase cost of tickets, concessions etc, there is no reason they can’t remain profitable for a long-long time.
Of course there will be a point to were the “common” man can no longer afford to purchase tickets to take his family to go watch a good ‘ol American game. Oh wait, that started about 5 years ago. So it will continue to evolve around corporate America and the “those that have, and those that have not”.
Green Bay is in a great market place, much like the Chicago Cubs, no matter how good or bad ends up on the field they will continue to sell out. Point of profit boils down to forecasting, and those projections. How far off of the bulls eye did they miss? Oh well…jack up ticket prices, increase concession $$$, the good old public will pay. They might bitch…but they will pay.
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Rating: 3.5 / 5 with 2 rating(s)
June 22nd, 2008 at 8:56 pm
kevinS says:
June 22nd, 2008 at 5:42 pm
I do not understand how “player costs” increasing is causing the profit to decrease. Player salaries are what the salary cap is for, as the league allots every team the money. And teams cannot go over the cap (supposedly)
What an idiot.
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Rating: 3 / 5 with 2 rating(s)