Strike Losses Not Merely Peanuts : Dodgers: Work stoppage affects vendors and homeless. O’Malley looking for a lasting solution.
Being the publicly private organization they are, the Dodgers, caretaker of the stadium in the ravine, do not want anyone to know how much money flows through their bank account. Or how much doesn’t.
Even in these strike-ridden times, the Dodgers, who along with Philadelphia and Boston have owners whose exclusive business is baseball, say the finances are private, and that’s their prerogative.
So we’ll figure it out for you.
The Dodgers’ estimated revenue for the regular season was supposed to be about $75 million, based on comparable figures for past seasons provided by Financial World magazine. Should the strike last the remainder of the season, which would be 52 days, the Dodgers’ loss in potential net income is $8.6 million plus another $5 million in postseason television revenue. This is based on potential gross revenue of $19 million minus $9 million in player salaries, $274,000 in travel expenses and $1.1 million in stadium personnel and operations expenses on the day of a game.
But the actual loss is much less. Based on a franchise that runs 365 days a year, and assuming an operating cost of $27 million, the Dodgers’ actual loss is $74,000 a day or $444,000 total for six days of the strike, during which the Dodgers would have been playing at home. The club is saving players’ salaries, which total $174,106 a day, but again, they are not receiving the $915,000 in total revenue averaged over the scheduled 82 home games, which include an exhibition game.
The $74,000 a day represents the cost of the 100 front-office employees and other operating costs supporting a product they can’t sell. But these numbers notwithstanding, there are other losses that are hitting home with the 1,600 part-time stadium and concession workers who have lost their jobs.
Owner Peter O’Malley met with his front-office employees this week and told them their jobs are safe for now. But the 600 part-time ushers, ticket-takers, clean-up crew and day-of-game stadium operations staff are out of work, a savings to the Dodgers of about $34,000 a game.
ARA Services, which owns and manages the concessions, has about 800-1,000 people out of work. That includes the peanut sellers, who can make up to $200 a game, and the concession workers, who average between $85-$120 a game.
And then there are those things that appear intangible, but are very real. ARA donates its cooked leftover food to the homeless.
O’Malley, a proponent of a lasting agreement with the players union, not merely a stopgap solution, is well-aware of the trickle-down effect of this strike.
“It’s hard to quantify (the financial situation) after three days or a week because it is complicated, but foremost on my mind is a big piece of this, which is goodwill,” O’Malley said. “We have a tremendous amount of goodwill that has been built for many years (from the fans) and how severely that is impacted is hard to quantify. That is a big concern on my mind.
“Times have changed and this is what, the (eighth) work stoppage in 22 years? That is way too many; it’s not normal. We must find a way to work closely with the Players’ Assn. and we have failed, and I’m not saying that it’s their fault or our fault. I’m just saying we have not been able to identify a way to work civilly and we must do that--we cannot keep putting the whole country through this every two or three years. It can’t be done. I don’t know another industry that has gone through this.
“We need a long-term agreement that will be embraced enthusiastically by both sides, not just an agreement where we will say, ‘Thank goodness it’s over,’ but something that is profound and lasting, not just something to take us out of the strike.”
Meanwhile, Bob Graziano, Dodger vice president of finance, continues to crunch the numbers and the strike continues to eat up the potential profits of $454,545 a day. The Dodgers’ only real saving in the strike is the player salaries, which amount to about $9 million the rest of the season. The total player payroll is now $31,681,500, excluding $3 million paid to Darryl Strawberry and pensions, etc., the latter of which are usually paid back after negotiations.
But even in payroll the Dodgers don’t save as much as other clubs. Players salaries represent only 52.2% of their total revenue. The Cincinnati Reds pay an industry-high 86.8% of their revenue to the players.
The majority of the Dodgers’ revenue is from ticket sales, concessions, merchandising and parking, which averages about $552,000 per home game and is estimated to be about $13.364 million for the 26 remaining home dates.
That figure is based on $414,000 in ticket sales, with average attendance of 41,444 and an average ticket price of $10. Parking revenue of $33,600 is based on 14,000 cars, though the lot accommodates 16,000. The Dodgers own the parking lot, charging $4 per car, but share the receipts with Public Parking Inc., which pays the employees and insurance from their share.
When the Dodgers switched from Arthur Foods, Inc. to Marriott a few years ago, they received a huge up-front sum plus a cut of sales per person, which is estimated at $1.50 per head, giving the Dodgers revenue of about $66,000 per game. ARA took over as concessionaire on June 27.
The other large portion of the Dodgers’ revenue comes from the television/radio package, which is reportedly $15.5 million annually for local television and another $5 million for radio. If the strike lasts the season, it will force cancellation of 11 scheduled telecasts and 48 radio broadcasts, an estimated revenue loss of $4.55 million. The Dodgers will also lose $1 million in merchandising revenue from sales at the stadium.
Other revenue received is from a cut of road attendance, which tends to cancel out what the Dodgers give visiting teams from their home games, and stadium leases for concerts, recreational vehicle shows, conventions, etc.
Other potential savings for the Dodgers would be the three remaining trips, during which 22 games were scheduled. They would save an estimated $273,862. The savings come from hotels ($82,800), charter planes ($105,000), meal money ($68,062), and buses, trucks and incidentals ($18,000).