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2018 NFL Cap Projected to be Between $174M-$178M


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12 hours ago, BigDingus said:

I'd be interested to see how much profit the Bills take in each year and where it comes from. As the cap keeps going up, it seems like smaller markets should find it harder & harder to compete, as they don't take in nearly as much revenue as the big city teams do.

I know there's revenue sharing, and the TV deals are extremely lucrative, but how does a team like Buffalo with a small market & fanbase afford to spend so much money on players in the future when it hits $200 million and above? Once they spend that much, how much is there left over for all the other costs of operations, coaching staff, scouts, front office personnel, trainers, regular employees, upkeep costs, stadium maintenance, property tax, facilities, marketing, etc.? 

Maybe NFL teams like us, the Titans, the Jags, or New Orleans make more money than I realize, but it still seems like eventually we won't be able to keep pace.



Edit: Well, I just looked into a tiny bit of it, and the Bills are dead last in terms of operating profit, and 2nd to last in total yearly revenue (we bring it $352 million yearly, netting $53 million in profit). Sadly, we're also valued at dead last at $1.6 billion, just under the Lions at $1.7 billion :(

Increasing the cap $7-10 million a year is going to quickly eat into that, as I know there's a minimum you HAVE to spend towards the cap each season. Even teams with smaller markets are pulling in more than us. https://www.forbes.com/nfl-valuations/list/#tab:overall

The salary cap is "paid" to each team or at least that is my understanding.  Player salaries are paid by league revenue.  All other costs associated with a team (travel, coaching, up front siging bonus money, etc...)  are the responsibility of the team.

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9 hours ago, klos63 said:

The reason the cap increases is because revenue increases, there's a correlation between the two. I'm not sure that this makes our situation worse.

 

Here is a better explanation for you klos since my last post was confusing.

 

The Cap is determined through a complicated calculation system, which has changed with the latest extension of the CBA. The Cap is based on income that the teams earn during a League Year. Originally that "pot" was limited to what was known as Defined Gross Revenues (DGR), which consisted of the money earned from the national televison contract, ticket sales, and NFL merchandise sales. In 2006 the CBA was modified, and the "pot" was expanded to include total revenue. Thus, other sources of revenue, including such other items as naming rights and local advertising, were added. As was the case with the original DGR, the expanded revenue is divided equally amongst all 32 teams for purposes of calculating the salary cap.

 

The newest edition of the CBA has a term, "All Revenues" (AR), which pretty much includes all revenue streams. The CBA spells ou the particulars over the course of about 10 pages, but in a nutshell the AR includes ticket sales, revenue from luxury box suites and premium seating, local and national broadcasting (TV/radio/Internet) royalties, concessions, parking, local advertising, stadium leasing, and merchadising. The AR is then divided into 3 distinct brackets: League Media (essentially revue from regular-season games), NFL Ventures/Post Season (self-explanatory) and Local (more or less revenue generated from preseason games). Now, fo r the part that you have been waiting for, the distibution of these revenues:


   Projected AR x CBA Percentage = Players Share of AR. This is called the Player Cost Amount. For 2011, that amount was $4,556,800,000 (roughly $142.4 M per team).


   Player Cost Amount minus Projected League wide Benefits = Amount Available for Player Salaries. For 2011, that amount was $3,852,000,000.


   Amount Available for Player Salaries / Number of Teams = Unadjusted Salary Cap per Team. For 2011, that amount was (3,852,000,000/32 =) $120.375 M.

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51 minutes ago, section122 said:

 

Here is a better explanation for you klos since my last post was confusing.

 

The Cap is determined through a complicated calculation system, which has changed with the latest extension of the CBA. The Cap is based on income that the teams earn during a League Year. Originally that "pot" was limited to what was known as Defined Gross Revenues (DGR), which consisted of the money earned from the national televison contract, ticket sales, and NFL merchandise sales. In 2006 the CBA was modified, and the "pot" was expanded to include total revenue. Thus, other sources of revenue, including such other items as naming rights and local advertising, were added. As was the case with the original DGR, the expanded revenue is divided equally amongst all 32 teams for purposes of calculating the salary cap.

 

The newest edition of the CBA has a term, "All Revenues" (AR), which pretty much includes all revenue streams. The CBA spells ou the particulars over the course of about 10 pages, but in a nutshell the AR includes ticket sales, revenue from luxury box suites and premium seating, local and national broadcasting (TV/radio/Internet) royalties, concessions, parking, local advertising, stadium leasing, and merchadising. The AR is then divided into 3 distinct brackets: League Media (essentially revue from regular-season games), NFL Ventures/Post Season (self-explanatory) and Local (more or less revenue generated from preseason games). Now, fo r the part that you have been waiting for, the distibution of these revenues:


   Projected AR x CBA Percentage = Players Share of AR. This is called the Player Cost Amount. For 2011, that amount was $4,556,800,000 (roughly $142.4 M per team).


   Player Cost Amount minus Projected League wide Benefits = Amount Available for Player Salaries. For 2011, that amount was $3,852,000,000.


   Amount Available for Player Salaries / Number of Teams = Unadjusted Salary Cap per Team. For 2011, that amount was (3,852,000,000/32 =) $120.375 M.

Interesting, so the revenue the Cowboys generate from their suites gets included? No wonder he wants Buffalo to move somewhere else, I wouldn't like that either.

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6 minutes ago, klos63 said:

Interesting, so the revenue the Cowboys generate from their suites gets included? No wonder he wants Buffalo to move somewhere else, I wouldn't like that either.

 

....true but look at it from the economy of scale and the corporate horsepower in a major market (Dallas) versus Buffalo.....we have a corporate 20 person suite in Buffalo......costs $75,000 per year......food and beverage in the suite runs about $1,500 per game or 12 grand for the season.....we provide limo bus transportation which is 8 grand per season....I'd bet a similar suite in Dallas would be $225-$250 grand a year and you could easily double the food and beverage expense.....if that was the tariff in Buffalo, we'd be out in a nanosecond as would many other suite holders we know.....now what??...........

Edited by OldTimeAFLGuy
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15 minutes ago, klos63 said:

Interesting, so the revenue the Cowboys generate from their suites gets included? No wonder he wants Buffalo to move somewhere else, I wouldn't like that either.

Just to be clear though, suite and local revenues like sponsorships are not shared revenue. Jerry still keeps all of that. 

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1 hour ago, klos63 said:

Interesting, so the revenue the Cowboys generate from their suites gets included? No wonder he wants Buffalo to move somewhere else, I wouldn't like that either.

My understanding is that the salary cap is paid by the NFL to each team.  There is a lot of revenue though that teams keep for themselves.  I know sponsorships are one as Jerry Jones sued in the 90s.  That's a good read for money that teams get to keep.  So it would benefit Jones to have the Bills be more lucrative but he is also doing well on his own.

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52 minutes ago, section122 said:

My understanding is that the salary cap is paid by the NFL to each team.  There is a lot of revenue though that teams keep for themselves.  I know sponsorships are one as Jerry Jones sued in the 90s.  That's a good read for money that teams get to keep.  So it would benefit Jones to have the Bills be more lucrative but he is also doing well on his own.

The teams get revenue from a number of sources...obviously TV is the biggest but the league doesn't pay the teams the salary cap. The teams share revenues and keep some on their own but how much they spend on the cap is up to them. Also, I don't think revenue from suites is shared. it's kept by each team

Edited by nucci
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9 minutes ago, nucci said:

The teams get revenue from a number of sources...obviously TV is the biggest but the league doesn't pay the teams the salary cap. The teams share revenues and keep some on their own but how much they spend on the cap is up to them. Also, I don't think revenue from suites is shared. it's kept by each team

 

Hmmm I thought the revenue sharing number was used to set the salary cap?

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