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Packers say player costs are rising at twice the rate of revenue

In a Wednesday conference call with national media, which followed a face-to-face meeting with local media, Packers CEO Mark Murphy explained that the team’s player costs are rising at twice the rate that revenue is increasing.

Murphy said that, since the current labor agreement was reached in 2006, player costs have risen at an average rate of 11.8 percent annually, with revenue increasing at only 5.5 percent per year. 

As to the $22 million increase in player costs over the past year and a $10 million increase in revenue, Murphy attributed the increase to the “maturation of the roster” and the signing of several players, like receiver Greg Jennings.

Still, Murphy calls the current player compensation system a “non-sustainable model.”

As to the current year, during which the model includes no salary cap or salary floor, Murphy said that the Packers are “operating under a budget and trying to be disciplined.”  Murphy later added that the team included “a little bit of growth” in this year’s player salary budget.

The potential problem for the league is that possibly too many teams are “operating under a budget and trying to be disciplined,” which could inevitably lead to a claim that multiple teams are colluding when it comes to player expenses.

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49 Responses to “Packers say player costs are rising at twice the rate of revenue”
  1. GBfanForever says: Jul 14, 2010 12:49 PM

    The rookie cap is needed. I’m just thankful as a packer fan that the team is run well enough to be profitable and have a competitive roster in tough times. They can’t say that in minnesota.

  2. schooney says: Jul 14, 2010 12:50 PM

    at leat the Pack does not have to pay for a new leather face for its CEO

  3. Bob Nelson says: Jul 14, 2010 12:53 PM

    Isn’t it refreshing to have such great franchise being so open, honest, straightforward and moral.
    With so many shareholders they have orderly, reasoned, open, moral and trustworthy.
    While you cannot trust some financial predatory shark who schemed a takeover of a franchise, you can trust the honesty and forthrightness of the Green Bay Packers.
    The truth is there for all to see.

  4. Citizen Strange says: Jul 14, 2010 12:55 PM

    There is not a single movie in Hollywood that has ever made any money either.
    I’m also kind of surprised that Las Vegas manages to stay in business at that the rate the casinos are losing money.

  5. plt2006 says: Jul 14, 2010 12:59 PM

    So the union would allege that numerous franchises adopting a normal business practice such as creating a budget and then following it constitutes collusion? I’m sorry but a lot of these owners made their money by being successful businessmen and it only makes sense that they’d run their franchises like businesses, especially given uncertainty in the labor market. Without a cap or floor player costs become variable and it makes sense to keep those in line since they can’t do too much about fixed costs (stadium upkeep). Seriously, these are not complicated economic principles at work here.

  6. VikingsPrincess says: Jul 14, 2010 12:59 PM

    @ GBfanForever
    You don’t think that the Vikings have a competitive roster? That’s interesting given our 2009 performance against the Packers.
    Zygi Wilf turns enough of a profit to give our QB $13 million to play this year.

  7. Contra says: Jul 14, 2010 1:03 PM

    GBfanForever says:
    July 14, 2010 12:49 PM
    The rookie cap is needed. I’m just thankful as a packer fan that the team is run well enough to be profitable and have a competitive roster in tough times. They can’t say that in minnesota.
    ———-
    Yes they can – with a team that beat the Packers twice and has won back to back division titles it makes me laugh that you believe there is no competitive roster in MN. Profits in MN – the Vikings are competitive there as well however if they had a new stadium with the luxury boxes that pretty much every other team enjoys then the Vikings would have increased profits. Unfortunately the Vikings do not own the Metrodome and do not receive any of the receipts that come with it.

  8. Dana87 says: Jul 14, 2010 1:05 PM

    It would be pretty hard to prove collusion in a down economy. As far as I can tell, employee costs are dropping across every type of business. That doesn’t mean all companies are colluding to keep costs down, They are independently making the decision that they can get by with a employee willing to take a lesser amount. Football teams have to make the decision all the time.
    The other factor is there will probably be a salary cap in the future and teams do not want to create a future problem now so they are more careful with their spending. This isn’t too far removed from normal business where although our company was profitable, they were concerned about the future and cut employee costs.

  9. AbeFreshly says: Jul 14, 2010 1:06 PM

    Stop typing the word “collusion”, you pot-stirrer. Or are you merely trying to kiss the players’ collective asses so they will all talk about how they read PFT?
    Player compensation is waaaay out of whack. Not just where the league & individual franchises are concerned, either. Nowadays, we fans have noticed a new monster on the horizon: Lethargy Addiction, which is when players get payed, then no longer resemble themselves.
    See Albert? In 2008, now THERE was a possessed man playing for a $100M contract. See Albert ’09? Did you notice any difference in his performance? There’s a man who RECEIVED his $100M contract. Stop stirring the pot Florio. You don’t have to brown nose the players. If they’re like me, they’ll come to PFT just to read the comments, not the articles.

  10. srackis says: Jul 14, 2010 1:07 PM

    Rookie salary cap, slotted like the NBA. Rookies would already be under contract and working out!

  11. Steeler79 says: Jul 14, 2010 1:10 PM

    Packers are the welfare child of football. If they had to rely upon their own market they’d be the team moving to LA

  12. GobiasINC_1 says: Jul 14, 2010 1:13 PM

    Whoa boy, cue the doomsday posts by FoF and pervy harvin. Pervy will no doubt drop a baker’s dozen worth of gay blasts for the Packers’ GM and QB. FoF will just blame Ted Thompson.
    So predictable, losers. So predictable.

  13. MkePackFan says: Jul 14, 2010 1:16 PM

    Only a tard like Florio would conclude that teams acting fiscally responsible are “colluding”.
    Next there are the idiots who are saying the books are cooked. As the Packers are a public company, their books must be audited by an independent CPA firm…so either you don’t understand how financial statements are prepared or you ignorantly believe the auditors are intentionally colluding with the Pack to deceive all the shareholders who receive no dividends and have no power.
    Either way, I think this will be ammo for the league since the Packers increased their revenues but player costs ate into so much of it that their operating profit was so small

  14. Nard100 says: Jul 14, 2010 1:16 PM

    Thank you Al Davis for overpaying for crap talent and screwing up the system year after year!

  15. GBfanForever says: Jul 14, 2010 1:17 PM

    # Steeler79 says: July 14, 2010 1:10 PM
    Packers are the welfare child of football. If they had to rely upon their own market they’d be the team moving to LA
    ——————————————————
    Dumbest comment on PFT today, hands down. Do some research and you’ll find the Pack subsidizes teams like the vikings.

  16. bluestree says: Jul 14, 2010 1:19 PM

    It seems like a rookie cap that was fair to all would offset a lot of the negative growth. The economic downturn is responsible for much of the lack of revenue growth. If not for the near collapse of the financial system things would look pretty good. Hard to believe that the current system is unsustainable, save for the top end of the draft.
    No doubt the owners are making less money, so are we all. Sounds like they want to get back to even by making the players take the hit for them, much like we taxpayers have absorbed the losses on Wall Street and made them whole, while we all suffer from having lost a lot of our wealth.

  17. MkePackFan says: Jul 14, 2010 1:21 PM

    Welfare child? Right…get your facts right…the Packers were one of the few teams that had to contribute to the Supplemental Revenue Sharing pool (which is spread out to smaller revenue teams).
    Oh and VikingPrincess, yes the Vikes can pay a QB $13M…but they also had to defer part of his salary from last year to this year (and our QB is going to make about as much as your 40yr old QB)

  18. Chapnasty2 says: Jul 14, 2010 1:22 PM

    2 or 3 people have already made this point but it angered me so badly that I need to say it one more time…. only an uber liberal like Mike Florio or NBC would consider fiscal responsibility by an organization or company colluision.

  19. jimmySee says: Jul 14, 2010 1:22 PM

    The Packers and their wide-open books are the ‘canaries in the coal mine’ of the NFL.

  20. GBfanForever says: Jul 14, 2010 1:25 PM

    Oh Contra, what will we do with you? You prove my point that the vikings aren’t profitable do to a lack of a stadium. If the franchise was run better, you’d have a new stadium. The twins have one, so should the vikings, if they weren’t mismanaged.

  21. Mark0226 says: Jul 14, 2010 1:33 PM

    You need to get off the collusion bandwagon. Operating under budget is smart business, not a conspiracy.

  22. whatthehellisgoingonoutthere says: Jul 14, 2010 1:33 PM

    # VikingsPrincess says: July 14, 2010 12:59 PM
    @ GBfanForever
    You don’t think that the Vikings have a competitive roster? That’s interesting given our 2009 performance against the Packers.
    Zygi Wilf turns enough of a profit to give our QB $13 million to play this year.
    —————–
    LMAO. You Vikings fans don’t even know the details regarding your own team. Zygi had to put Favre’s 2009 salary on Lay-A-Way to be paid out in installments through 2011 when he’s not even on the roster. His 2010 salary is going to be paid even further out into the future. If the Vikings (the lowest revenue team in the NFL) turns enough of a profit, then why does he have to make a cash call to investors to pay Jared Allen’s signing bonus.
    The Packers fall somewhere in between #6-#12 in league revenue. If they’re making only $5 million in profit, you really think the Vikings at 32 are making a dime in profit? Please…..

  23. Contra says: Jul 14, 2010 1:34 PM

    GBfanForever says:
    July 14, 2010 1:25 PM
    Oh Contra, what will we do with you? You prove my point that the vikings aren’t profitable do to a lack of a stadium. If the franchise was run better, you’d have a new stadium. The twins have one, so should the vikings, if they weren’t mismanaged.
    ———
    You’d be absolutely right if Governor Tim Pawlenty owned the team and was not trying to make a run at the presidents office. Unfortunately…that is not the case.

  24. robert ethen says: Jul 14, 2010 1:38 PM

    Count Ted can’t count in his counting house.

  25. garylandon41 says: Jul 14, 2010 1:39 PM

    Too bad more teams in the NFL don’t have the accountability that the Packers are held to as a public organization. The league would be better.
    The NFL is lucky to have the Packers.

  26. Bob Nelson says: Jul 14, 2010 1:44 PM

    The Packers are one of the top revenue teams in the NFL.
    They have to pay into the NFL’s welfare program for poor franchises called supplemental revenue sharing.
    Do you forget when Jerry Jones was fined for chastizing the vikings for not paying their fair share and being supported by successful small market teams Green Bay and Kansas City?
    Some of you better look up some facts before spewing ignorance and lies.
    http://www.forbes.com/lists/2008/30/sportsmoney_nfl08_NFL-Team-Valuations_Revenue.html
    Remember the Green Bay Packers have the lowest debt (if any) of any NFL franchise.
    The Green Bay Packers are better off than most NFL franchises especially the Steelers Mr. ignorance, steelers79. Look it up.

  27. robert ethen says: Jul 14, 2010 1:46 PM

    All the numbers are red. “Like BLAAAHHD!” howled Count Ted.

  28. ChiefsNfl says: Jul 14, 2010 1:51 PM

    @ Chapnasty2:
    What does being a liberal have anything to do with football? You’re confusing politics and sports. Fiscal responsibility is necessary regardless of who you are or represent, and collusion is always a consideration when professional sports are involved.

  29. Satanic Hell Creature says: Jul 14, 2010 1:53 PM

    GBfanForever says:
    July 14, 2010 12:49 PM
    The rookie cap is needed. I’m just thankful as a packer fan that the team is run well enough to be profitable and have a competitive roster in tough times. They can’t say that in minnesota.
    ————————————————–
    Again, a Packer fan has to take an article or posting that is solely about their team and turn it into a Vikings thread. You obviously suffer from V.D.S. (Viking Derangement Syndrome). Read the article, take for what it’s worth and coment on it without turning it into a Viking thread. So sad…

  30. oldlefthander says: Jul 14, 2010 2:07 PM

    Baseball owners were slapped for collusion several times in the ’80s, also during a down economy.
    Yelling about it and calling people names wouldn’t have made it go away then, and it won’t make it go away now. (If, in fact, there is any hard evidence it is happening.)

  31. robert ethen says: Jul 14, 2010 2:12 PM

    On the bright side, by the time all the player suspensions are handed down, the Packers should cut their payroll by about half.

  32. sand0 says: Jul 14, 2010 2:15 PM

    Packer stock just keeps on dropping. It will be interesting to see what happens in that small city if their “budget team” starts to win like a budget team usually does, i.e. not much. They are on more shaky ground than their fans would like to admit.
    Despite having what they perceive to be this insanely popular team their team still has to operate with a relatively low payroll just to turn a profit. Ruh roh raggy…

  33. Steel Dahn Sahth says: Jul 14, 2010 2:16 PM

    Both sides are attempting to win the hearts of the public before the lockout.
    I support the owners. If they lose, we’ll have another MLB.

  34. sand0 says: Jul 14, 2010 2:18 PM

    I would be pissed if my team of choice admitted to fielding a “budget roster”. That is pretty sad considering how proud the people there claim to be of their football team.
    I just don’t see how the Packers win more than 8 games this season. You heard it here folks. They had a good run there in Green Bay but ultimately the city just couldn’t support a professional franchise in today’s ultra competitive atmosphere.

  35. MotorCityKitties says: Jul 14, 2010 2:23 PM

    You know what I like about GB? The way those hillbilly fans stack blocks of cheese on their heads like a pack of zilches. Only in Lambeau is a fungus a fashion statement. You know what I like about the Vikings? The pretty, yellow yarn pig-tails that those dum-dums wear. Keep looking stupid with those horns and purple pom-poms. Both your teams STINK! Sincerely, Angry Lions Fan

  36. robert ethen says: Jul 14, 2010 2:35 PM

    Packers are stocking up on styrofoam and cardboard.

  37. pervy harvin says: Jul 14, 2010 2:53 PM

    Thanks for letting me beat up on you Packer douchers,I really have enjoyed it. Even though your posts bordered on mental masturbation,was enjoyable. I am retiring from PFT to pursue a hazardous endeavor. Heres to always losing to the Vikings!

  38. forthelove says: Jul 14, 2010 3:03 PM

    Financial information comparing 2006 to present would be helpful in assessing this report. e.g. Were the Packers below the cap in ’06? How far? Are they below the cap now (or what the cap would be if there were one this year)? How far? I could imagine signing long-term contracts to players like Jennings and A-rod could take up a substantial portion of that $22 million. Answers to the cap values from above would help see whether the $22M increase is from fluctuations in spending or a true upward trend.

  39. Supersuckers says: Jul 14, 2010 3:25 PM

    pervy harvin says:
    July 14, 2010 2:53 PM
    Thanks for letting me beat up on you Packer douchers,I really have enjoyed it. Even though your posts bordered on mental masturbation,was enjoyable. I am retiring from PFT to pursue a hazardous endeavor. Heres to always losing to the Vikings!
    ————-
    Real original Whig!! See ya soon!!

  40. robert ethen says: Jul 14, 2010 3:34 PM

    I think it’s all tied to the hog-share market. Less of the hogs in Wisco are willing to share their disposable income.

  41. twizzlystick says: Jul 14, 2010 3:56 PM

    The way things are going there’s a real possibility that all the 1 share owners in Wisconsin are gonna have their homes foreclosed on to pay for all the Packers debt and even that probably won’t be enough.

  42. Vikadontis Rex says: Jul 14, 2010 3:58 PM

    I don’t get why people rip on the Vikings for struggling right now…
    We just built a new Twins stadium and Gophers football stadium, we don’t have enough tax payers support for a new stadium. Do you really want the Vikings to move to LA? Then the Rams would join the North, wouldnt that be AWESOME!?!
    Yeah the Vikings have a smaller fan base than the Packers, and personally I enjoy that. If I lived in New York I’d be a Jets and Mets fan.
    The same things get posted from both sides in every single thread:
    Packers fans: “How many superbowls have you won?”, “Your team will be nothing when Favre gets hurt/retires”, “Enjoy moving to LA”…
    Vikings fans: “We’ve stomped you guys in recent history, won the last 2 division titles…” “Packers fans are fat.” (okay that last one was mine…)
    It’s just ridiculous why people would cheer for the Vikings to move when it would break up the NFC North… Yeah we haven’t won any superbowls but we true fans stick to our team even with years of heartbreak. That’s what being a fan is.

  43. FoF says: Jul 14, 2010 4:00 PM

    Rising player costs is nothing new, yet profits have taken a nose dive in the past 3 years. What has changed? Brett Favre is not longer with the team. There folks is the reason the Packers are strugling right now.

  44. Lurch says: Jul 14, 2010 4:20 PM

    Revenue sharing is the key to success in the National Football League. Without it, football would resemble major league baseball, where the big market Yankees can outspend anyone for players.
    When teams cannot buy their way out of mistakes, and must rely on good coaching and a well-run organization … the cream rises to the top.
    Keep the financial playing field even, and let the talent – or lack of it … determine the rest.

  45. Supersuckers says: Jul 14, 2010 4:22 PM

    FoF says:
    July 14, 2010 4:00 PM
    Rising player costs is nothing new, yet profits have taken a nose dive in the past 3 years. What has changed? Brett Favre is not longer with the team. There folks is the reason the Packers are strugling right now.
    ————
    No it isn’t the reason. its spelled out in the article. And Favre retired at the end of 2007. He retired. He got on the podium, on his own, and said he didn’t want to play anymore. It was going to happen sometime. And for Green bay that day in March 2008 was a fabulous, fabulous day. We now have the premier QB in the NFC and a young and powerful roster.

  46. va4favre says: Jul 14, 2010 5:18 PM

    Supersucker, It’s comments like yours that make me a former Pack fan! Why can’t you root for Rodgers without tearing down Favre? What has he done to you except bring in milllions and millions for GB. GB is down in local revenues, and that includes a dramatic decline in their merchandise sales. Also, when the Pack travel, there is no longer the demand that there used to be for tickets from fans. GB, of course, still has a loyal fan base, but they are not spending as much. Maybe when Rodgers wins two SBs, his merchandise sales will go up. He is very talented, but very homely with no charisma. It’s not going to be easy, but I already gave out my recipe for success.

  47. funi says: Jul 14, 2010 5:29 PM

    Packers moving to L.A. cheeseheads!

  48. dafish says: Jul 14, 2010 5:41 PM

    Collusion? What a load of bullshit. Use those $5 words and theories for places where they are applicable.
    For those teams that are “fiscally responsible” as the Packers claim to be, you’d think all the players would wind up in Washington, Dallas, New England, or the Jets.

  49. Hap says: Jul 14, 2010 5:46 PM

    How much are The Packers books saying they made ?

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