Insolvency in the City? Not So Much
As was reported today by the ever impressive David Pollak, the Sharks saw a shortfall of $15 million last season. This despite always having (paid) sellouts, charging $8 bucks for a beer, and way too damn much money for chicken strips sans fries. Unsurprisingly, some fans balked at the figure; 15 million is a lot of dough to be down with "nothing" to show for it, yet The Sharks seemed unphased by it. What does this shortfall really mean for us as fans?
At the moment, probably nothing. Sports teams are notroious for being money losing ventures, rather than money gaining ones. The Sharks are still putting a competive team out on the ice, and seeing dividends in terms of ticket and merch sales, and likely advertising. While I think we'd all prefer them to be in the black, the Sharks are 6th on Forbes list of debt/value % out of 30 (16th overall). They could owe a lot more/be worth a lot less.* The Sharks are decidely middle of thepack right now in terms of revenue. They aren't starving for it, but they aren't the Leafs either. While the numbers sounds bad, I wouldn't be too worried. Sports teams are big business and big business often means losses that look horrible to those of us who work normal jobs, but mean little to entities worth hundreds of millions.
*The ownership group states that the Sharks currently have no debt. They look to the owners to help cover any monetary needs rather than banks. These numbers are from 2011 and do not reflect the current financials of the Sharks. They do give a good picture of how the team was previously though, so I have pointed at them for reference.
**obviously I am not an economist, or even some crazy math whiz, so I could be totally full of it here. I am just drawing conclusions based off things I have read and some fast googling on debt/value ratios and what they mean. This is the internet after all, so if I am wrong, you'll all tell me.
