They make a profit on football to fund tournaments for a bunch of other sports.
I get it...thats the basis of this discussion...without constantly increasing football revenue...the other sports are hosed. And what is really amazing...when you talk to other non-revenue sports people at schools who hate football because football "gets everything"...but, as you stated...football pays for a bunch of other sports...where would the OHSAA be without football? What a golden goose...and that is true at all levels.
Why would a non-profit show such a profit? I gotta get me a tax free gig like that...
You don't understand how to calculate the profit that the OHSAA makes on the football tournament? Not difficult stuff. Revenue - Expenses. Now, in this case, I believe they used Marginal Revenue - Marginal Expenses, which for our purposes, should be close enough.
And it appears as if our bet will be decided about this time next year. But I will not take the bet unless we are talking about the profit number. The revenue number, by itself, is an irrelevant figure.
From the OHSAA Board Minutes a week ago:
" The financial report from the 2011 regional and state football tournaments was presented to the Board. The five-round postseason resulted in a profit of $1,762,206, which is slightly ahead of the projected amount. As has been previously noted, the football postseason generates approximately 33-percent of the OHSAA’s operating revenue (gross revenue of $4,136,905 in 2011, with expenses totaling $2,374,699)."
Like I said splitting hairs. In most cases you need to increase Revenue in order to increase Profits.
And again we will agree to disagree. What I meant by putting them in the red is that if this decision resulted in them losing money on the playoffs versus increasing their "profit" on the football playoffs then I don't think they would have moved forward with it. Football is their cash cow that they use for all the other sports. Keeping the constituents happy is important but at what cost is also a very critical piece to the puzzle.
I don't care how much crying is going on if the OHSAA was going to lose money by adding a 7th division I truly believe they wouldn't have done it. Adding the extra division plus the "competitive balance" BS is still going to create dissension among the membership because it's damn near impossible to come up with a perfect solution. So you risk alienating one group versus another but if you can make money when you do it then the OHSAA is all for it.
We definitely disagree on this. Not much more to say.
And given your and your fellow Moeller brethren's stance that the difference between revenue and profit is "splitting hairs," I have no choice but to question the economics and math teaching that goes on over there.
You don't understand how to calculate the profit that the OHSAA makes on the football tournament? Not difficult stuff. Revenue - Expenses. Now, in this case, I believe they used Marginal Revenue - Marginal Expenses, which for our purposes, should be close enough.
And it appears as if our bet will be decided about this time next year. But I will not take the bet unless we are talking about the profit number. The revenue number, by itself, is an irrelevant figure.
From the OHSAA Board Minutes a week ago:
" The financial report from the 2011 regional and state football tournaments was presented to the Board. The five-round postseason resulted in a profit of $1,762,206, which is slightly ahead of the projected amount. As has been previously noted, the football postseason generates approximately 33-percent of the OHSAA’s operating revenue (gross revenue of $4,136,905 in 2011, with expenses totaling $2,374,699)."
It would be the spring of 2014 to collect on the bet as I see it as the 2013 football season as the first split.
I get profit and loss...we all do...and yes, I will take your profit bet. One thing where you are incorrect...revenue is NOT an irrelevant figure. No revenue. No profits. Period. Go ahead and do the math if OHSAA raised tickets by $1 this football season. Major profit increase without expense increase. OHSAA is so far past the break even point, next dollar revenue heads straight to bottom line. This happens with media companies, which really, coupled with a consumer event company, is what the OHSAA business model is based on.
Now, reality is, if the commissioner doesn't take everyone to Hawaii again or hire 24 of his brother in laws with the additional revenue, they should should actually have a higher profit margin dollar and percentage amount with the added revenue because they should have the administration infrastucture in place to run an addtional 31 games with only location activation and management costs as expenses.
See you in April 2014.
(FYI-2 Double Cheese, Fries and and Orange Soda.)
GBM!
It would be the spring of 2014 to collect on the bet as I see it as the 2013 football season as the first split.
I get profit and loss...we all do...and yes, I will take your profit bet. One thing where you are incorrect...revenue is NOT an irrelevant figure. No revenue. No profits. Period. Go ahead and do the math if OHSAA raised tickets by $1 this football season. Major profit increase without expense increase. OHSAA is so far past the break even point, next dollar revenue heads straight to bottom line. This happens with media companies, which really, coupled with a consumer event company, is what the OHSAA business model is based on.
Now, reality is, if the commissioner doesn't take everyone to Hawaii again or hire 24 of his brother in laws with the additional revenue, they should should actually have a higher profit margin dollar and percentage amount with the added revenue because they should have the administration infrastucture in place to run an addtional 31 games with only location activation and management costs as expenses.
See you in April 2014.
(FYI-2 Double Cheese, Fries and and Orange Soda.)
GBM!
Hmm, no revenue = no profits? Why didn't I think of that. Of course, it was never part of the argument but if you want to try to throw a red herring in there to make yourself feel better, be my guest. More importantly, not sure why you Moe guys ever disputed the revenue vs. profit argument in the first place (other than just to be argumentative), but glad to see we are now on the same page.
As far as your all new revenue = profit argument, that is where your logic is pretty lacking. While I agree that simply charging an extra buck would increase marginal revenue by the entire dollar while not increasing marginal cost, it would not necessarily result in an increase in profit. This is because it would likely result in at least some decrease in demand which, in turn, would result in a decrease in total revenue and profit. Although, in the end, it probably would end up increasing profit somewhat as for most people, the ticket price is not significant in the decsion-making process as to whether to attend or not attend a high school football game.
HOWEVER, staging 31 extra games DOES increase marginal costs (significantly, in fact).
Furthermore, if the 7th game results in two games of the state championship (where, on a per game average, the OHSAA makes most of their money) end up being combined as a doubleheader (presumably at the same price as the single game tickets), the increase in marginal revenue for that one session, while there should be some, will not equal the average profit from the other sessions. In fact, it may barely cover the increase in marginal costs, depending on the teams involved and their fan support and remembering that marginal costs for the extra games include the money needed to pay team transportation, lodging, food, etc.
By the way, I agree fixed costs should not increase significantly due to the addition of the seventh game, but that marginal costs (including the aforementioned travel expenses paid for by the OHSAA and also stadium rentals, non-volunteer staffing, etc.) In 2011, on an average basis, the OHSAA made $293,701 per division for the football playoff. That is right between your initial estimate of 250k and your second estimate of 350k. My point is that I do not believe that the addition of a 7th division, will result in an increase in total profit close to that average, and that it will likely be closer to 150k, maybe 200k tops. And I also believe that an increase in profit of 150k - 200k is not something that significantly factored into the decision by the OHSAA as it represents less than 4% of their total operating budget, in other words, a drop in the proverbial bucket.
Although you are right about the first year split being 2013, so this is a bet to be resolved two years from now. As for the meal, let's just make it $10. If you win, you can use it to buy White Castles if you want.
The biggest question for 'profit' is whether the TV revenue offsets the loss of people who would go to the games if they weren't able to watch them live on TV in HD.
It would be the spring of 2014 to collect on the bet as I see it as the 2013 football season as the first split.
I get profit and loss...we all do...and yes, I will take your profit bet. One thing where you are incorrect...revenue is NOT an irrelevant figure. No revenue. No profits. Period. Go ahead and do the math if OHSAA raised tickets by $1 this football season. Major profit increase without expense increase. OHSAA is so far past the break even point, next dollar revenue heads straight to bottom line. This happens with media companies, which really, coupled with a consumer event company, is what the OHSAA business model is based on.
Now, reality is, if the commissioner doesn't take everyone to Hawaii again or hire 24 of his brother in laws with the additional revenue, they should should actually have a higher profit margin dollar and percentage amount with the added revenue because they should have the administration infrastucture in place to run an addtional 31 games with only location activation and management costs as expenses.
See you in April 2014.
(FYI-2 Double Cheese, Fries and and Orange Soda.)
GBM!
You can't reason with L Hand, he's always right! Like a woman thinks.
Hmm, no revenue = no profits? Why didn't I think of that. Of course, it was never part of the argument but if you want to try to throw a red herring in there to make yourself feel better, be my guest. More importantly, not sure why you Moe guys ever disputed the revenue vs. profit argument in the first place (other than just to be argumentative), but glad to see we are now on the same page.
As far as your all new revenue = profit argument, that is where your logic is pretty lacking. While I agree that simply charging an extra buck would increase marginal revenue by the entire dollar while not increasing marginal cost, it would not necessarily result in an increase in profit. This is because it would likely result in at least some decrease in demand which,q in turn, would result in a decrease in total revenue and profit. Although, in the end, it probably would end up increasing profit somewhat as for most people, the ticket price is not significant in the decsion-making process as to whether to attend or not attend a high school football game.
HOWEVER, staging 31 extra games DOES increase marginal costs (significantly, in fact).
Furthermore, if the 7th game results in two games of the state championship (where, on a per game average, the OHSAA makes most of their money) end up being combined as a doubleheader (presumably at the same price as the single game tickets), the increase in marginal revenue for that one session, while there should be some, will not equal the average profit from the other sessions. In fact, it may barely cover the increase in marginal costs, depending on the teams involved and their fan support and remembering that marginal costs for the extra games include the money needed to pay team transportation, lodging, food, etc.
By the way, I agree fixed costs should not increase significantly due to the addition of the seventh game, but that marginal costs (including the aforementioned travel expenses paid for by the OHSAA and also stadium rentals, non-volunteer staffing, etc.) In 2011, on an average basis, the OHSAA made $293,701 per division for the football playoff. That is right between your initial estimate of 250k and your second estimate of 350k. My point is that I do not believe that the addition of a 7th division, will result in an increase in total profit close to that average, and that it will likely be closer to 150k, maybe 200k tops. And I also believe that an increase in profit of 150k - 200k is not something that significantly factored into the decision by the OHSAA as it represents less than 4% of their total operating budget, in other words, a drop in the proverbial bucket.
Although you are right about the first year split being 2013, so this is a bet to be resolved two years from now. As for the meal, let's just make it $10. If you win, you can use it to buy White Castles if you want.
When someone says it ain't about the money...it is about the money...but thanks for admitting I was right and my guesses are in the range of expectation based on current profit levels. When they raise ticket prices...I will be very close.
When someone says it ain't about the money...it is about the money...but thanks for admitting I was right and my guesses are in the range of expectation based on current profit levels. When they raise ticket prices...I will be very close.
You can't reason with L Hand, he's always right! Like a woman thinks.
This from the guy who's immediate reaction to this was how nobody would want to play LaSalle and this would screw everything up for X "who only plays D1 Ohio schools" (see, eg, post 160) and then completely reverses positions two days later (see post 240).
I agree it can be tough always being right. I can't imagine how tough it is for you always being wrong.
Hmm, no revenue = no profits? Why didn't I think of that. Of course, it was never part of the argument but if you want to try to throw a red herring in there to make yourself feel better, be my guest. More importantly, not sure why you Moe guys ever disputed the revenue vs. profit argument in the first place (other than just to be argumentative), but glad to see we are now on the same page.
As far as your all new revenue = profit argument, that is where your logic is pretty lacking. While I agree that simply charging an extra buck would increase marginal revenue by the entire dollar while not increasing marginal cost, it would not necessarily result in an increase in profit. This is because it would likely result in at least some decrease in demand which, in turn, would result in a decrease in total revenue and profit. Although, in the end, it probably would end up increasing profit somewhat as for most people, the ticket price is not significant in the decsion-making process as to whether to attend or not attend a high school football game.
HOWEVER, staging 31 extra games DOES increase marginal costs (significantly, in fact).
Furthermore, if the 7th game results in two games of the state championship (where, on a per game average, the OHSAA makes most of their money) end up being combined as a doubleheader (presumably at the same price as the single game tickets), the increase in marginal revenue for that one session, while there should be some, will not equal the average profit from the other sessions. In fact, it may barely cover the increase in marginal costs, depending on the teams involved and their fan support and remembering that marginal costs for the extra games include the money needed to pay team transportation, lodging, food, etc.
By the way, I agree fixed costs should not increase significantly due to the addition of the seventh game, but that marginal costs (including the aforementioned travel expenses paid for by the OHSAA and also stadium rentals, non-volunteer staffing, etc.) In 2011, on an average basis, the OHSAA made $293,701 per division for the football playoff. That is right between your initial estimate of 250k and your second estimate of 350k. My point is that I do not believe that the addition of a 7th division, will result in an increase in total profit close to that average, and that it will likely be closer to 150k, maybe 200k tops. And I also believe that an increase in profit of 150k - 200k is not something that significantly factored into the decision by the OHSAA as it represents less than 4% of their total operating budget, in other words, a drop in the proverbial bucket.
Although you are right about the first year split being 2013, so this is a bet to be resolved two years from now. As for the meal, let's just make it $10. If you win, you can use it to buy White Castles if you want.
You seem to be willing to research....If $293,701 is the average of 6 divisions...what is the D1 profit number? If you can't find it...would you agree that D1 is substantially higher than all the other divisions?
You seem to be willing to research....If $293,701 is the average of 6 divisions...what is the D1 profit number? If you can't find it...would you agree that D1 is substantially higher than all the other divisions?
Didn't see it in the research I did and not willing to do any more.
I would agree with MANOWAR, that it probably depends on the year. Although I would agree in most years it is higher.
If you are going to do some research, see if you can find how much profit comes from the championship games vs. the other games.
By the way, the reason I don't think the addition of the 7th division is going to result in close to the addition of the average profit per division that the OHSAA enjoyed last year of almost 300k is because the new division will water down the average profit and because the proposed doubleheader at the championship will do the same.
This from the guy who's immediate reaction to this was how nobody would want to play LaSalle and this would screw everything up for X "who only plays D1 Ohio schools" (see, eg, post 160) and then completely reverses positions two days later (see post 240).
I agree it can be tough always being right. I can't imagine how tough it is for you always being wrong.
Just like you to ignorantly misinterpret my post. It must be way over your head. It wasn't switching my position, it was taking the very small amount of time to add up the points and notice it wasn't a significant difference, as I was told my many.
As for your last statement, I can tell their is no conceit in your family...you have it all. And always being wrong is far from the truth. Mistaken or misinformed would be more accurate...but, again, that's way over your head.
But I do enjoy getting a response out of you. You play right into my hands! What a pity you're not smart enough to realize this after almost 3 years.
You guys are acting like a bunch of ADD CPA's with all this number crunching! Look, as my old boss told me many many years ago...sales covers a lot of sins and it is more fun to work for a business that is increasing it's sales than one that is not. I have found that to be a truism. Bottom line, this is a numbers game...more butts in the seats=more revenue=more profit=more job security for the "management". As MoeJoe said, if you just raised ticket prices a buck plus the increased attendance of the new division...you're sitting pretty. Heck, i would argue you could raise ticket prices to $10 and see no negative affect on attendance...I'm paying $12 for my season tickets...$10 would still be a bargain for me!
To those that don't think this is just more "watering down," you're really in denial! Every time you add a division or create a competitive balance thing, you are, as Ross likes to point out, giving communities a chance to experience the playoffs that wouldn't normally have this chance. That's because they DO NOT DESERVE to be there!
Yeah! School xyz is the best in the state in div. 7, then 8, then 8aII non-catholic, 50 boys in the school left handed, 10 with poor eyesight that get food vouchers, but only on Wednesday...
Go back to three divisions...back when winning your conference and beating your neighbors was the real season. Or have a playoff tourney and crown a true state champ out 32 teams. Or put everyone in conferences based on geography and all conference champs go to a playoff tourney.
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