If salary caps were introduced, as was originally claimed, to protect clubs from over extending themselves, and not to penalise Wigan.. then simply limiting a club to spending a percentage of the previous years turnover would be the simple way of doing it.
This would stop over-spending, but also incentivize clubs to grow, generate income from all available sources, and raise the profile of the game as a whole. It's not the job of the governing body of any sport to get involved in the business affairs of the clubs, but to administer support, the rules of the game on the pitch, and disciplinary matters. It's restraint of trade apart from anything else.....
SALARY CAP
Re: SALARY CAP
The model I'm proposing is heavily influenced by sports like NFL and MLS. They are able to run a central organization plus a franchising system where clubs pool resources. They are able to do this without each club racing to the bottom. The two sports are at opposite ends of popularity in the US, with one in a dominant position and one looking to grow from a smaller base. MLS has shown its very possible to grow in this model from a position say 10 years ago in comparison with other higher profile US sports which maybe a reasonable parallel to where RL is now. Both organisations have some franchises that input more money than others, without the successful ones just giving up on all marketing (as seems to have been suggested they should).
The idea that because a successful team (in terms of merchandising and income) pools part of its income to a central fund encourages that team to simply stop generating income seems odd to me. That team is motivated to improve the impact of the sport overall to improve its own finances and those of the overall compeition. It benefits the successful teams to see all other teams improve to their level because it increases the overall pool that everyone contributes to and draws from. Everyone's budget goes up, and the profile of the sport increases. In addition, a side effect of improving the financial performance of the less successful teams is the quality of the on field competition goes up, further improving the sports profile and overall financial resources.
On top of that, the central organisation has minimum standards that must be met to even have a franchise, so if your marketing performance drops below those, then you lose your spot anyway. So its not just carrot, there is a meaningful stick there too.
If a new potential franchisee comes along, you judge them on whether they increase the size of the overall pool (either immediately, or in the medium term) then you either bring them in, or replace a poorly performing franchise.
This is really not much different to how things were run the old franchising scheme with Super Legue as the central organsiation, but its actually going the whole way to that model, rather than stopping part way. IMGs new closed shop is moving us back in that direction, you're just adding to the system by putting everyone in the same financial boat which motivates them to pull together in the same direction, rather than fighting against one another.
This all happens on the back office side BTW, obviously not on the playing side, everyone is still scrapping for wins on the field, prize money and all that. Its still competitive sport, just the "sport" is all working together to maximise its impact and profile off the field, rather than as individual clubs all with different strategies, with a seperate central organistion trying to manage competing individual clubs with difference goals (plus now we're back with the RFL lower leagues as well with totally separate goals and completely different financial reality).
The idea that because a successful team (in terms of merchandising and income) pools part of its income to a central fund encourages that team to simply stop generating income seems odd to me. That team is motivated to improve the impact of the sport overall to improve its own finances and those of the overall compeition. It benefits the successful teams to see all other teams improve to their level because it increases the overall pool that everyone contributes to and draws from. Everyone's budget goes up, and the profile of the sport increases. In addition, a side effect of improving the financial performance of the less successful teams is the quality of the on field competition goes up, further improving the sports profile and overall financial resources.
On top of that, the central organisation has minimum standards that must be met to even have a franchise, so if your marketing performance drops below those, then you lose your spot anyway. So its not just carrot, there is a meaningful stick there too.
If a new potential franchisee comes along, you judge them on whether they increase the size of the overall pool (either immediately, or in the medium term) then you either bring them in, or replace a poorly performing franchise.
This is really not much different to how things were run the old franchising scheme with Super Legue as the central organsiation, but its actually going the whole way to that model, rather than stopping part way. IMGs new closed shop is moving us back in that direction, you're just adding to the system by putting everyone in the same financial boat which motivates them to pull together in the same direction, rather than fighting against one another.
This all happens on the back office side BTW, obviously not on the playing side, everyone is still scrapping for wins on the field, prize money and all that. Its still competitive sport, just the "sport" is all working together to maximise its impact and profile off the field, rather than as individual clubs all with different strategies, with a seperate central organistion trying to manage competing individual clubs with difference goals (plus now we're back with the RFL lower leagues as well with totally separate goals and completely different financial reality).
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Wigan_forever1985
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Re: SALARY CAP
Ok so i understand a bit more now about what you're suggesting but i still dont think it would work for Rugby League
I see the examples youve used of MLS and NFL and i can tell you in 3 sentences why they are completely different scopes
NFL teams are now worth $4.47 billion on average
The average Major League Soccer (MLS) franchise is now worth US$582 million
according to companys house Wigans net worth -£5,940,348.00
The problem is there isnt enough of the pie to keep everyone fed so the idea bigger clubs will give up any is like the starving giving food to the more starving
We have to look outside our walls we need money coming in - we cannot solve this problem with what we have, the cap restricts anyone who wants to invest - Dr Koukash could of been a turning point, but RFL stamped him out
I fear the route cause of Rugby Leagues issue is the people in our walls, its not that we cant attract investment its that we avoid it. People at the big 3 dont want to spend more money - they want to spend less so a Koukash character threatens the norm, but thats what Rugby League needs
Rugby League needs more Koukash's and more Eddie Hearns - it needs less Ralf Rimmers and Gary Hetheringtons we need revolution not evolution
I see the examples youve used of MLS and NFL and i can tell you in 3 sentences why they are completely different scopes
NFL teams are now worth $4.47 billion on average
The average Major League Soccer (MLS) franchise is now worth US$582 million
according to companys house Wigans net worth -£5,940,348.00
The problem is there isnt enough of the pie to keep everyone fed so the idea bigger clubs will give up any is like the starving giving food to the more starving
We have to look outside our walls we need money coming in - we cannot solve this problem with what we have, the cap restricts anyone who wants to invest - Dr Koukash could of been a turning point, but RFL stamped him out
I fear the route cause of Rugby Leagues issue is the people in our walls, its not that we cant attract investment its that we avoid it. People at the big 3 dont want to spend more money - they want to spend less so a Koukash character threatens the norm, but thats what Rugby League needs
Rugby League needs more Koukash's and more Eddie Hearns - it needs less Ralf Rimmers and Gary Hetheringtons we need revolution not evolution
Our deepest fear is not that we are inadequate. Our deepest fear is that we are powerful beyond measure
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josie andrews
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- Location: Wigan
- Contact:
Re: SALARY CAP
Excellent postWigan_forever1985 wrote: ↑Thu Oct 13, 2022 8:46 am Ok so i understand a bit more now about what you're suggesting but i still dont think it would work for Rugby League
I see the examples youve used of MLS and NFL and i can tell you in 3 sentences why they are completely different scopes
NFL teams are now worth $4.47 billion on average
The average Major League Soccer (MLS) franchise is now worth US$582 million
according to companys house Wigans net worth -£5,940,348.00
The problem is there isnt enough of the pie to keep everyone fed so the idea bigger clubs will give up any is like the starving giving food to the more starving
We have to look outside our walls we need money coming in - we cannot solve this problem with what we have, the cap restricts anyone who wants to invest - Dr Koukash could of been a turning point, but RFL stamped him out
I fear the route cause of Rugby Leagues issue is the people in our walls, its not that we cant attract investment its that we avoid it. People at the big 3 dont want to spend more money - they want to spend less so a Koukash character threatens the norm, but thats what Rugby League needs
Rugby League needs more Koukash's and more Eddie Hearns - it needs less Ralf Rimmers and Gary Hetheringtons we need revolution not evolution
Especially the last sentence 
Anyone can support a team when it is winning, that takes no courage.
But to stand behind a team, to defend a team when it is down and really needs you,
that takes a lot of courage. #18thMan
But to stand behind a team, to defend a team when it is down and really needs you,
that takes a lot of courage. #18thMan
Re: SALARY CAP
Its interesting you mention Eddie Hearns. My understanding (from the press, nothing else) is that his organization dropped out *because* central ownership wasn't on the table. To grow the business he wanted more control than is possible in our model.Wigan_forever1985 wrote: ↑Thu Oct 13, 2022 8:46 am Ok so i understand a bit more now about what you're suggesting but i still dont think it would work for Rugby League
I see the examples youve used of MLS and NFL and i can tell you in 3 sentences why they are completely different scopes
NFL teams are now worth $4.47 billion on average
The average Major League Soccer (MLS) franchise is now worth US$582 million
according to companys house Wigans net worth -£5,940,348.00
The problem is there isnt enough of the pie to keep everyone fed so the idea bigger clubs will give up any is like the starving giving food to the more starving
We have to look outside our walls we need money coming in - we cannot solve this problem with what we have, the cap restricts anyone who wants to invest - Dr Koukash could of been a turning point, but RFL stamped him out
I fear the route cause of Rugby Leagues issue is the people in our walls, its not that we cant attract investment its that we avoid it. People at the big 3 dont want to spend more money - they want to spend less so a Koukash character threatens the norm, but thats what Rugby League needs
Rugby League needs more Koukash's and more Eddie Hearns - it needs less Ralf Rimmers and Gary Hetheringtons we need revolution not evolution
My proposal is precisely aimed at pulling in the same direction to grow the overall pool. That requires the smaller clubs to get bigger or be replaced with those that can. Whilst we are working on attracting more investment, we only have a fixed pool size, so we have to reallocate our funds to grow the pool overall, rather than keeping those resources in areas where the market is more saturated already and potential for growth is lower. Every business does this. Is just resource allocation, but taking into account the whole competition, not only within each individual franchise. I'm not proposing a complete reallocation, better performing clubs would always be independently run and have more resources, but it would allow a total-competition strategy to be enacted.
And one more point, both MLS and NFL (and the NRL) have salary caps. They are obviously much higher and represent the financial situation of those sports (well actually the MLS lower paid players are surprisingly poorly paid), but they haven't prevented the sports from attracting investment. In fact, you can argue that a salary cap can help attract investment, as it caps the liabilities any owner can take on, which makes financial planning much easier. BTW look at the value of an MLS franchise 10 or 20 years ago and see how much growth they have achieved under this model with a salary cap plus marquee players and pooled resourcing.