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Tuesday, September 28, 2010

How They Do It

Here's the first part of a series that examines the Top 5 teams from last season - Cincinnati, Houston, Montreal, Hartford, and Burlington. First up - budgeting.

For the Top 5 teams, here are the averages -

Player - 77 million (+6 million relative to league average)
Prospect - 10.4 million (-6.6 million)
Coach - 9.8 million (-2.2 million)
Coll Scout - 15 million (+1 million)
H.S. Scout - 15.4 million (+.4 million)
International Scout - 6.8 million (-4.2 million)
Advance Scout - 17.6 million (+1.6 million)
Training - 17.2 million (+2.2 million)
Medical - 15.8 million (+1.8 million)

Budgeting for each team should vary every year based upon eact teams needs, or even WIS changing the rules. For instance, coach budgets should be lower now as you can promote minor league coached to ML spots for the minimum.

Relative to the world, these 5 teams spent more on players, advance scouts, training, and medical. They spent less on prospects, coaches, and international scouting. They spent roughly the same on College and High School scouting.

So what can be learned? Houston and Montreal spent nothing, or the minimum, on international scouting and prospects. They did not plan on building their teams through IFA's and budgeted accordingly. These savings allowed MON and HOU increase payroll, training, and medical. These are also teams that are in "win now" mode, so it makes sense that they sacrificed a category (or two). This is a specific strategy but might not be for everyone. Hartford, for the most part, also used this strategy.

Cincinnati used a similair strategy, but not as drastic. They also had a low internation scout budget, but not as low as the other two. The were more similair to Houston, but spent more on prospects and less on college/hs scouting.

Burlington had the highest payroll of the Top 5 at 82 million. Their strategy was fairly simple, they signed a bunch of Type A Free Agents so had no need for college/hs scouting. They believe in IFA's, however, and used these savings to keep the IFA budget high. They also had a high advance scout, indicating that trading for prospects was of interest.

One thing in common for all of the Top 5 - they were also smart on coaches. The Top 5 teams comprised 5 of the lowest 12 spending teams. But this is not for everyone - if your ML coaches are all leaving and you don't have anyone to promote from within, then you will need to spend more here. This is not so much of a stategy as the new normal - there is no reason to spend more than 12 million on coaches.

Another interesting note, all 5 teams were moderate on player payroll. Not too high, and not too low.

For comparisons sake, here is how the bottom 5 returning teams spent their allotment

Player - 66.2 million (-4.2 million relative to league average)
Prospect - 18.2 million (+1.2 million)
Coach - 14.4 million (+2.2 million)
Coll Scout - 14.4 million (+.4 million)
H.S. Scout - 14.2 million (-.8 million)
International Scout - 11.6 million (+.6 million)
Advance Scout - 15.8 million (-.2 million)
Training - 13 million (-2 million)
Medical - 11.8 million (-2.2 million)

It seems that the extra money spent on coaches here meant sacrificed money on training and medical. It makes sense that rebuilding teams spend money on prospect budget, but it is surprising that their scouting does not reflect their rebuilding. These teams seem to be undecided on their direction.

So what can be learned? Don't spend money on coaches if you can promote from within. Figure out what you are - if you are a contender, consider sacrificing intl or amateur draft categories. If you are rebuilding, then max out your scouting and intl budgets. In any event, it seems that the better teams spend more on training and medical. They also spend more on advance scouting to maximize trade knowledge. IFA's require a major investment - 20 million prospect budget, 20 million IFA scouting, and a player payroll transfer is required for the best of them. If you can't commit to that, then there is no need to max out at the cost of lower training and medical.

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