Cubs to sign Kimbrel

[Otto von Ballpark]

Most revenue now comes from media deals. They reportedly spend half of revenue on payroll. That would mean a $50 million per season increase would be needed to support a $25 million per season payroll increase.

Is that really feasible just from increased attendance alone?

It's not just increased attendance. If the team really keeps up this pace for awhile, sponsorships and ad revenue should go up significantly too. More leverage for improving TV broadcast revenue. And postseason brings its own extra revenue.

 

And while they spend approx. 50% of their current revenue on payroll, I don't think the 50% figure necessarily holds for potential additional revenue. For example, if they reach the WS and can extract an extra $10 mil a year from FSN, it's not like their expenses/profit need to automatically go up by $5 mil. Maybe the marginal rate would be 60 or 70 percent or something.

[Mr. Brooks]

Severino's extension pays him $10 mil as an arb2, doesn't seem unreasonable that Berrios would get something like that too, either in award or extension.

 

Buxton is only making $1.75 mil in arb1 too, so I don't think he will necessarily blow way past $10 mil in arb3 in award or extension.

 

That change plus the Rosario estimate seemed like you were trying to frame the numbers to fit your conclusion rather than the other way around.

Buxton is making so little because of how badly he struggled.

I expect to see 2 years of fringe MVP play before he gets his ARB3.

He's on pace for 7.5 bWAR, and I expect improvement next year.

 

Berrios will get a bigger deal than Severino, IMO.

[Mr. Brooks]

Who cares? They're not plan their roster and payroll based on TD reaction. (Or are they? Should I use more emojis? )

It was just a note. Of course it doesn't matter.

[Mr. Brooks]

It's not just increased attendance. If the team really keeps up this pace for awhile, sponsorships and ad revenue should go up significantly too. More leverage for improving TV broadcast revenue. And postseason brings its own extra revenue.

 

And while they spend approx. 50% of their current revenue on payroll, I don't think the 50% figure necessarily holds for potential additional revenue. For example, if they reach the WS and can extract an extra $10 mil a year from FSN, it's not like their expenses/profit need to automatically go up by $5 mil. Maybe the marginal rate would be 60 or 70 percent or something.

Hey we can hope, it's cool.

I'll believe it when I see it though.

[Otto von Ballpark]

Buxton is making so little because of how badly he struggled.

I expect to see 2 years of fringe MVP play before he gets his ARB3.

He's on pace for 7.5 bWAR, and I expect improvement next year.

 

Berrios will get a bigger deal than Severino, IMO.

FWIW, Severino was coming off 5.3 and 4.8 bWAR seasons. Berrios had 3.9 last year and is on pace for 3.3 this year.

 

Buxton did have a 5 bWAR year in 2017, that was part of his arb calculation, although yes, the lost season drags it down. But much of that WAR is still defense though -- are there any crazy arb comps for that profile? Keirmaier and Enciarte signed extensions, but those figures don't necessarily support the idea that Buxton is going to get crazy arb awards. I bet he loses some more time between now and the end of 2020 too.

[Otto von Ballpark]

Hey we can hope, it's cool.

I'll believe it when I see it though.

Well, I don't necessarily expect them to post MLB's second best record from now through 2020 either, or win a world series.

 

I too will bet revenue and payroll don't grow much, but I'm also expecting some performance regression. If they keep up this pace and get those arb awards and contracts you predict, we might see more growth though.