Forbes Ranks The NFL's Most Valuable Teams

[BillsVet]

"Forbes ranks the Bills ninth, with an annual operating income of $40.9 million (that's after they pay the players). And it's more than the Philadelphia Eagles, Pittsburgh Steelers, and New York Jets each make. It's also more than triple what the Miami Dolphins or Super Bowl Champion Green Bay Packers take away."

 

If the Bills, who haven't been to the playoffs since 1999, can still put fans in the stands and make $40.9 million a year, why should they change anything (especially considering the fact that they receive millions of dollars a year in taxpayer subsidizes)?

 

Not to mention they've seen an 11k drop in ST sales from 2009 to 2010. This is a franchise that know their ST base will again decrease to perhaps as low as 38-39k in 2011.

 

Not bad for a team, as you say, that's without a playoff appearance since the 20th century.

Edited September 10, 2011 by BillsVet

[PromoTheRobot]

the other nfl owners won't let the bills move from western new york to LA.

 

IT'S TOO LARGE OF A MARKET AND WITH A FAILING, MISERABLE, AWFUL PRODUCT IS MORE PROFITABLE THAN 2/3RDS OF THE LEAGUE.

 

how this is hard to understand, is beyond me.

 

if promo was on a dallas board, it would be

 

"jerry jones is going to die. dallas is a big market, but LA is bigger. better hope we get a ring soon, because once he's gone, you can kiss the cowboys good bye too."

 

the nfl is not leaving western new york/toronto.

 

not this year, not next year, not when ralph wilson dies, not when his kids die, not when you die, when i die, when anyone dies.

 

the bills monopolize the entirety of one of the largest media markets in the western hemisphere of this planet, and manage to do it with a brand that is absolute trash. if this team manages to win and become trendy, like the pats did this past decade, it's value will be higher than all but a few franchises. the nfl came back to CLEVELAND because it has a niche of f*cking OHIO that it found profitable and lucrative. stop being blind to the facts that the nfl is not going to leave the toronto market, and it's millions of undivided fans, when there's jacksonville, san diego and st. louis, all of which play in divided markets and have been mentioned CONTINUOUSLY as the franchises most likely to move.

 

not only most likely to move - but targeted by the people building a stadium in LA.

 

this relocation talk is so ridiculous and tiring.

Hope you are right.

 

PTR

[SwampD]

If you own a billion-dollar asset and you want to access your equity without selling that asset, you borrow against it. Not to buy anything per se, but to start distributing your estate to you family, so that when you do go, after loans are repaid, there is nothing left for the taxman. Talk to an MBA.

 

PTR

That's a pretty good answer.

[ThurmasThoman]

Hope you are right.

 

PTR

 

it's not about being right, it's just about looking at the facts.

 

ralph wilson is from detroit, he lives in detroit, he doesn't stay in buffalo, and despite what he says, he doesn't care about buffalo.

 

the bills, to him, are a very lucrative business.

 

if the bills were going to move to LA, they would have moved to LA (or any other "sexy" market, like san antonio, alabama, oklahoma city, etc.) LONG before we had the internet to make our feelings known on message boards.

 

the reason why the LA bills don't exist at this very moment, is because the western ny/toronto market is all alone for the bills.

 

in terms of city size in the western hemisphere it goes:

 

mexico city

new york

LA

chicago

TORONTO

 

you don't move the bills from toronto to LA to make money.

you make the bills profitable in western new york. which is what they are currently doing by playing a game in toronto every year. im 100% positive goodell had something to do with that decision.

 

and let's say, worst possible scenario, ralph dies this season, AEG targets the bills, buys the bills, bills move to LA.

 

in... MAYBE a year, but possibly before the next season, the jaguars would move here and retain the bills colors/franchise history.

 

9th most profitable team in the league playing in the 5th biggest market on this side of the globe.

 

i can't stress enough that the bills aren't leaving.

i mean, i really can think of no other way to put it besides i would wager the balance of my years on this planet against an extra 5 seconds to live on there being a football team in western new york for as long as the league exists.

[BillnutinHouston]

It should be pointed out that having this franchise rank 9th in profitability WITH THIS OWNER, IN BUFFALO does not necessarily mean the franchise will have similar dynamics in another market and under different ownership. After a sale, and if moved to a new market, a new set of dynamics impacting franchise profitability kick in. Some of these factors work against relocation, and some work in favor of it, such as:

 

1) Stadium debt servicing (in Buffalo as it now stands this franchise incurs none, whereas elsewhere it could be a huge long-term expense impacting profitability)

2) Unshared revenue from luxury suites (another market would likely generate more $)

3) Advertising revenues (likely greater in a larger market)

4) Payroll size (a new front office might spend more than the incumbents)

5) Ticket prices (certainly will generate higher revenues in another market)

 

Some of these factors obviously counteract each other. To me the main takeaway is that the current franchise in Buffalo is financially healthy - as long as the Ralph remains a viable venue. Overall that's good news since it suggests that a local owner buying the Bills would not have to look at his investment as a "charitable transaction", however a major variable that any prospective owner would have to look at and determine is, what is the future of RW Stadium and how will that future impact my potential cash flow? And, can a new venue in Buffalo be financed in a way that doesn't weigh down the team with massive debt?

 

Obviously as the County enters lease negotiations with the Bills, the Bills will be minimally concerned with issues pertaining to the long term, instead focusing on near term operational cost issues. But hopefully, the County & State have their eyes on the OTHER BALL - they need to be looking at/working on plans to either renovate RWS or build and finance a new venue such that the region is well positioned to make Buffalo an atractive long term home for the new ownership group. This positioning will require a) ensuring the facility meets the expectations of the new NFL and b) doing so in a way that doesn't saddle the new ownership with debt that would impede profitability.

Edited September 10, 2011 by BillnutinHouston

[Sisyphean Bills]

I prefer the notion that it was all Buddy's idea.

[LGB]

 

...AEG targets the bills, buys the bills, bills move to LA....

 

 

why would the Bills move to LA before the Jags who - can't even sell out their home opener (with tarps covering the upper seats in their stadium)?

 

if the Bills move, it will likely be towards Niagara Falls or maybe Darien Lake - in a new WNY multi-purpose stadium.

[PromoTheRobot]

why would the Bills move to LA before the Jags who - can't even sell out their home opener (with tarps covering the upper seats in their stadium)?

 

if the Bills move, it will likely be towards Niagara Falls or maybe Darien Lake - in a new WNY multi-purpose stadium.

Because apparently Wayne Weaver signed some kind of lease that ties up the Jags until 2026 or something like that.

 

PTR

[LGB]

Because apparently Wayne Weaver signed some kind of lease that ties up the Jags until 2026 or something like that.

 

PTR

 

wow, breaking that lease might not be so easy either...

[BiggieScooby]

What this means is either we are one of the cheapest teams to buy, with almost zero long term debt. Hopefully Ralph's estate sells at a 10% discount to keep the team in WNY.

[Billsguy]

Isn't it the point of business to maximize profit? People love spending other people's money. Going into the Red by getting overpriced free agents isn't a solid business plan.

 

Missing the playoffs for 11 seasons is not a great plan. It may be profitable, but it sucks as a strategy if winning is the objective. Clearly, Ralph Wilson finds profits more important than winning!

 

What this means is either we are one of the cheapest teams to buy, with almost zero long term debt. Hopefully Ralph's estate sells at a 10% discount to keep the team in WNY.

 

This is ridiculously naive. Ralph Wilson cares for Ralph Wilson. He doesn't care about WNY. If he cared, he would have already lined up local interests to succeed him as owner.

[The Senator]

Missing the playoffs for 11 seasons is not a great plan. It may be profitable, but it sucks as a strategy if winning is the objective. Clearly, Ralph Wilson finds profits more important than winning!

If there was a correlation between lack of profit and winning, the Detroit Lions (-$7.7M) would be the league's most successful franchise, followed by the Cleveland Browns (-$2.9M) and the San Francisco 49ers (+$1.5M).

 

This is ridiculously naive. Ralph Wilson cares for Ralph Wilson. He doesn't care about WNY. If he cared, he would have already lined up local interests to succeed him as owner.

And if all Ralph cared about was profit, the Bills would have moved to Seattle in 1970, or to LA or one of the many other cities pining for a franchise over the 40 years since, yet they are still here.

 

Most of us also have no idea what RW's estate planning has entailed thus far. Care to share your inside info with your fellow Bills fans?

 

.

Edited September 10, 2011 by The Senator

[OvrOfficiousJerk]

Because apparently Wayne Weaver signed some kind of lease that ties up the Jags until 2026 or something like that.

 

PTR

 

Very true, but all the effort poured into Team Teal was pretty telling -- former Jag Tony Boselli spearheaded this massive effort to increase season ticket sales after the blackout-laden 2009 season, the mayor got in on it and everything I think. Granted it may be all in the name of PR, but at the same time it really seemed modestly desperate for a team that shouldn't have to worry about relocation for a couple cycles of the Mayan calendar. Perhaps there is a clear and present danger of the "losing money" clause kicking in?

 

 

 

All in all, everyone waiting for Ralph to go thinking the Bills will magically improve when that happens better get used cheering for them in L.A. because there is about a 1% chance they stay in WNY.

 

PTR

 

1% chance of staying is a mite overdramatic. TG bangs this point home whenever he's on an TBN chat: there could be a random billionaire who comes out of nowhere to buy the team and keep it in Buffalo. I defy anyone on this board to tell me they knew the name Terry Pegula -- well, unless you were some anti-fracking hippie or a PSU alum/hockey player -- in fall 2010. After the Golisano years (mind you, which were critical in saving the franchise), I would never believe anyone who told me that the Sabres who had an owner who threw Vito Corleone type money at free agents so I wouldn't have to cringe every time July 1 rolled around, who is pouring millions in improving our arena, who cried when he saw the French Connection, who has his team president chatting with fans every other week for suggestions. Granted, the asking price would be four- to five-times higher for the Bills than the Sabres, but the point remains -- there are people out there that we've never heard of who have plenty of money to throw around. I don't want Ralph to pass either, but I'm more likely to agree w/ jw, who puts the odds of the Bills staying at 70%. Not a sure thing, but not wholly unlikely.

Edited September 10, 2011 by OvrOfficiousJerk

[Lurker]

that doesn't make much business sense.

This just in: nobody buys an NFL team to make money operating it. It the scarcity value that attracts the big egos with the big wallets that makes it an attractive investment.

 

Like owning art or diamonds, but a whole lot more fun...

[ICanSleepWhenI'mDead]

If you own a billion-dollar asset and you want to access your equity without selling that asset, you borrow against it. Not to buy anything per se, but to start distributing your estate to you family, so that when you do go, after loans are repaid, there is nothing left for the taxman. Talk to an MBA.

 

PTR

I suggest that you go back to your MBA friend, ask him to research the interplay between estate taxes and gift taxes (for gifts that exceed something like $11,000 per year to any particular donee - - $22,000 per year if given to that same donee jointly by a married couple) and get back to us with the details of how Ralph could distribute a significant portion of a billion dollars this way to avoid paying taxes. The threshold for gifts to any particular donee without triggering tax consequences may have gone up slightly from the $11,000/$22,000 per year that it once was, but if so, probably not by much.

 

Tell your MBA friend to talk to an estate planner.

 

Edit: Or have him read this:

 

http://turbotax.intuit.com/tax-tools/tax-tips/Tax-Planning-and-Checklists/The-Gift-Tax/INF12036.html

 

The federal gift tax exists for one reason: to prevent citizens from avoiding the federal estate tax by giving away their money before they die.

Edited September 10, 2011 by ICanSleepWhenI'mDead

[ICanSleepWhenI'mDead]

 

I personally think that 20 mil could go pretty far to making this team better. That's still 20 mil in profits for the year. Not bad. If you throw in a home playoff game, you would get another 10 mil in profits back as well. 2 playoff games and you're back to even and you've given the fans what they so desperately deserve.

This link provides a different take. There's a lot of pure garbage in some articles at the same site, but this one appears to be supported by quotes from NFL management types (although it was written in 2005, so there have been two new CBAs signed since then - - numbers could have changed):

 

http://www.associatedcontent.com/article/4020/do_nfl_teams_profit_from_the_playoffs_pg2.html?cat=3

 

Why do teams lose money during the playoffs? Many point the revenue sharing system employed by the NFL.

 

Each team receives and equal amount of league revenue, TV contract, merchandising, and home game ticket revenue. During the regular season, home teams get to keep two-thirds of the ticket revenue, the remaining third goes into a pool shared by all other teams. The NFL keeps all ticket revenue during the playoffs, but home teams can keep money made off other stadium related sales, merchandise, concessions etc. etc. The NFL pays division winning teams a flat fee of $580,000 and other teams $500,000 in the first round. In the second round, each team gets $580,000 and in the championship round $960,000. The Super Bowl winner receives $3.5 million and runner up $2.59 million. That is usually not enough to cover team expenses. John Jones, Executive Vice President and Chief Operating Officer of the Green Bay Packers said, "Expenses usually exceed whatever you get from the league."

 

Not sure if this applies to the Bills, because it's at least possible that they incur less playoff game day expenses than most teams because of their sweetheart lease with Erie County - - I haven't tried to figure that out. I also don't know if it's still true that the league keeps all playoff ticket revenue - - haven't tried to check that out either.

Edited September 10, 2011 by ICanSleepWhenI'mDead

[Trader]

The biggest winners are high-revenue team owners who will see their revenue sharing payments to their low-revenue rivals drop. In part this explains why the value of the top 10 teams rose 4% on average.

 

There is a growing divide between the rich and poor NFL franchises (poor being a relative term as all 32 teams rank among the 50 most valuable sports teams in the world). Supplemental revenue sharing payments to low revenue teams under the old CBA were expected to rise to $220 million with high rolling teams like the Cowboys, Washington Redskins (No. 2, worth $1.55 billion) and New England Patriots (No. 3, worth $1.4 billion) supplying much of the welfare and on the hook for more than $10 million apiece.

 

Under the new CBA, the amount any big market teams will have to kick into the system is capped at $3.5 million. Low revenue teams will receive only $50 million to $100 million collectively in the early years of the deal according to NFL estimates. Leaguewide revenues are expected to increase to the point where supplemental revenue sharing almost disappears by the end of the new 10-year CBA.

 

The new CBA hurts teams at the bottom of the financial pyramid as well because beginning in 2013, teams must spend 89% of the salary cap in cash or be subject to penalties. Keeping a lid on player costs allowed the Tampa Bay Buccaneers to be football’s fourth most profitable teams over the past five years. The Bucs’ player costs were $35 million lower than any other team during that time and $150 million less than the Cowboys. The Chiefs, Bills and Bengals have also kept spending in check fattening up the bottom line. That is not an option anymore. While the value of the top teams is up, the bottom 10 stayed flat on average.

 

http://www.forbes.com/sites/kurtbadenhausen/2011/09/07/the-nfls-most-valuable-teams/

 

 

You have to wonder just how much the value of this franchise will increase if they continue winning and become a contender. More importantly for the fans will the Bills become more aggressive in retaining players? The team is likely to have new ownership within a few years. Will the value of a winning franchise become more important than having a low payroll and expense ratio? if Ralph's money guys are so sharp they might just believe that this franchise can sell for 1 Billion +.

[r00tabaga]

the toronto market is enormous, and the bills are the only brand in all of western new york and that toronto metro area.

 

you have a 1% understanding of this situation if you think there will never be football in western new york after ralph wilson dies.

 

it's too big, it's too much of a proven market, it's too much of a guarantee.

 

people are killing themselves to put a team in LA, which has been a failing proposition two? three? times? i lost count.

 

if the nfl leaves buffalo, the nfl will come back to buffalo quicker than it came back to cleveland.

 

a winning team would be immensely profitable in this region in this day and age.

 

take your toe off the shotgun trigger.

 

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