Tag: Tampa Bay Rays

MLB Playoffs: My Annual Team Payroll Analysis

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With Fall in the air and my hometown Tampa Bay Rays in the playoffs for the 3rd out of 4 years my thoughts turn to…. my 4th annual playoff payroll analysis. Maybe I have a screw loose (my wife will attest to this), but I think it is amazing to compare and contrast how well a team does on the field with how well their front office does managing the payroll and delivering RESULTS!

Full disclosure… I make a living as a “money guy” comparing and contrasting one investment vehicle with another and allocating capital accordingly. I spent my day comparing risk and reward, so my mind can’t help be fascinated by the astonishing payroll differences * in professional baseball as opposed to other team sports that have embraced a salary cap. Baseball does not have a level playing field. Large market teams like the New York Yankees use the rest of the league as their farm system. When the Yankees need a new pitcher they sign the hottest free agent in the league. Doesn’t this just seem wrong?

The best thing about the playoffs is that every year there are 2 or 3 small market teams that make it to the final dance. Like Polyester and Spandex Clad Davids they have slain the great Goliath to enter the playoffs where every team starts 0-0 and any one of 8 teams can win the World Series.

Of the 30 MLB Teams Tampa Bay Rays rank 29th in payroll… only the Kansas City Royals spend less on their players than the Rays. How about that for efficiency? Since the team was purchased by a former partner at Goldman Sachs the front office has done an incredible, virtually perfect job at getting maximum efficiency for the lowest possible payroll. To make it into the Playoffs as the Wild Card Team the Rays defeated the Boston Red Sox with an astonishing $162 million payroll. Hard work, a great farm system, exemplary scouting, team spirit & passion defeats a payroll 3.95x larger. That is a team you gotta love.

I’ll be cheering for the Rays! How about you

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American League: New York Yankees $ 203 million Detroit Tigers $ 106 million Texas Rangers $ 92 million Tampa Bay Rays $ 41 million

National League: Philadelphia Phillies $ 173 million St. Louis Cardinals $ 105 million Milwaukee Brewers $ 85 million Arizona Diamondbacks $ 54 million

* Payroll statistics from USA Today

MLB Playoff Race: Does Team Payroll Matter?

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With only two more regular season games on the MLB calendar and the playoff matchups still unclear this is foreshadowing the most exciting postseason in recent memory.

Since I make a living as a “money guy” my mind can’t help be fascinated by the staggering payroll differences * in professional baseball as opposed to other team sports that have embraced a salary cap. The parity created by the salary cap in other sports has leveled the playing field, encouraged competition and keeps fans on the edge of the seats hoping that “this is going to be the year” their team rises above and makes the payoffs. Baseball on the other hand is heavily skewed toward teams with the highest payrolls with the occasional “Cinderella Story”.

This year fans of the underdog will be hoping the San Diego Padres continue their surge and make the playoffs. I’m astonished how competitive they have been this season especially when you see that their highest paid NL rival, the Phillies, pays their players 3.74x more and their highest paid AL rival, the Yankees, pays their players 5.44x more.

I’ll be cheering on my hometown team the Boston-design-company as opposed to my childhood favorite New York Yankees with 2.8x the payroll. Go Rays!

American League: New York Yankees $ 206,333,389 Minnesota Twins $ 97,559,166 Tampa Bay Rays $ 71,923,471 Texas Rangers $ 55,250,544

National League: Philadelphia Phillies $141,928,379 San Francisco Giants $ 98,641,333 Atlanta Braves $ 84,423,666 Cincinnati Reds $ 71,761,542 San Diego Padres $ 37,799,300

* Payroll statistics from USA Today

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