Are NHL Owners Owed a Profit?
I would like to address an idea that seems to float around on boards such as this, and others that I read. The idea that the owners, by paying the expansion fee, have a right to make a profit.
I would like to address an idea that seems to float around on boards such as this, and others that I read. The idea that the owners, by paying the expansion fee, have a right to make a profit. That if an owner does not make money every year then something is wrong. To that I say why?
The point I see written by others is that this is a business and thus the owners deserve to make money off of it. I have a newsflash for you; every business does not make money. I’m sure every restaurant did not make money last year, but I don’t see the public arguing for a salary cap on waiters and cooks. Owning a hockey team is a business, and as such you have a right to make money if you run it well. Owners that run their hockey teams well seem to make money.
Running your business well starts even before you obtain the business. If you are unable to properly assess the market for the product you wish to market then why should I feel sorry for you? I don’t feel sorry for the man who starts an ice store in the Arctic, nor do I feel sorry for the man who buys a hockey team in a southern American state. These are places hockey should not have gone, and the only people who can be blamed for this are the owners who decided to pay good money to put the teams there. They knew the current NHL economic environment they were getting into, and should have analyzed the market they wished to enter before making the investment that they did.
That being said, I do believe that something needs to be changed. Not because I care about owner profits, but because I would like to see greater parity in the NHL. I think this will happen with either an effective luxury tax or a salary cap. A strong enough luxury tax becomes a salary tax for most teams, and a point that teams may go beyond but not by much. I think the owners are pushing for cost certainty and a salary cap because they believe that they are owed a profit from their business (or at least would like to be guaranteed one). I disagree with this, but would be interested to hear your comments.