The Wild organization hopes the new CBA helps Minnesota become more profitable. (Photo Courtesy of wild.nhl.com)
The Minnesota Wild’s first game is less than a week away. Hockey fans throughout Minnesota are abuzz with anticipation for the NHL season to open. For the Wild, it begins against Colorado this Saturday night at Xcel. NHL fans throughout the U.S. and Canada were frustrated by the lockout, which persisted for 113 days. The lockout, however, is the thing that just might make Minnesota’s franchise profitable.
While fans grumbled throughout the state as the beginning of the season was pushed back further and further in 2012 and eventually into 2013, owners like Wild owner Craig Leipold knew he needed a change if he were gong to make the franchise profitable. He knew he needed changes both on the ice and off.
Leipold signed Zach Parise and Ryan Suter both to eye-popping 13-year $98 million contracts this off season to try and help things off the ice. Minnesota scored the least amount of goals in the entire league last season. The organization’s hope is to give the fans a perennial playoff contender. Leipold’s hope is to make the organization profitable at the same time.
One might suspect that the Wild are one of the most profitable teams in the NHL, but they are no longer selling out every game like it did for the first 10 years of the organization’s existence. Even then, the Wild were not within the NHL’s elite, both as far as play on the ice and the revenue generated. While the Wild looked for help on the ice from their off season moves, they needed help from other NHL teams to support their bottom line.
There are three teams in the NHL that make up 80% of the league’s operating profit–the Toronto Maple Leafs, the New York Rangers and the Montreal Canadiens. This is the type of lopsided profit margins that requires the have’s to support the have-nots. The new labor agreement attempts to address this problem.
“The Wild have been through their history sort of break-even, flirting around there, making a little money, and in more recent years, losing a little bit of money as the NHL salary cap has been rising each year,” said Mike Ozanian, who is a pro sports finance writer for Forbes.
While NHL teams keep their finances private, Ozanian believe that the Wild hasn’t turned a profit since 2009. They aren’t alone either. Nearly half of all NHL teams had operating losses last season. This is one of the largest factors to the owners locking the players out. The new CBA should help alleviate some of those losses however as wealthier teams will be subsidizing the poorer ones. This should help Leipold and the Wild return to profitability.
“Of course that’s all depending on how well the team is managed and promoted and how successful they are ultimately on the ice,” says economist Andrew Zimbalist of Smith College in Massachussetts. “But it gives them more of a fighting chance, I think, than they’ve had in the past.”
While the CBA should help Minnesota’s bottom line, the major offseason moves should help their win total. If both happen, everyone in Minnesota will be happy.
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