.comment-link {margin-left:.6em;} >
 

HOW MUCH SHOULD AN MLB WIN COST?

[January 15th] -- I wrote a story last season about the Nationals' "cost per win" in relation to the other team's in the National League. The Nationals, with 81 wins and a payroll of $48,581,000, averaged $603,000 per victory. Only the Brewers ($493,000) and the Pirates ($569,000) had lower "cost per win" totals.

What does "cost per win" really mean? The actual numbers don't mean a whole lot, really. But within those numbers are trends that in fact do have some meaning. Here are the 2006 National League numbers (rounded):

  1. Florida - 78 wins @ $192,000
  2. Colorado - 76 wins @ $542,000
  3. Pittsburgh - 67 wins @ $697,000
  4. Cincinnati - 80 wins @ $761,000
  5. Milwaukee - 75 wins @ $768,000
  6. Arizona - 76 wins @ $785,000
  7. San Diego - 88 wins @ $794,000
  8. D.C. - 71 wins @ $889,000
  9. Philadelphia - 85 wins @ $1,039,000
  10. New York - 97 wins @ $1,042,000
  11. St. Louis - 83 wins @ $1,071,000
  12. Los Angeles - 88 wins @ $1,119,000
  13. Houston - 82 wins @ $1,129,000
  14. Atlanta - 79 wins @ $1,141,000
  15. San Francisco - 76 wins @ $1,185,000
  16. Chicago - 66 wins @ $1,431,000

As you can see, the Nationals "cost per win" jumped $286,000 and dropped them from the 3rd to the 8th lowest amount while losing ten more games than they did the previous year.

It's becoming clear that the size of a team's payroll in most cases has little to do with wins and losses.

Overall, eight teams had a payroll increase of at least 4% last year, while five teams had a reduction of at least 4%. Two teams, the Mets and the Giants, had essentially the same payroll in both 2005 and 2006.

Here are the four teams with the largest payroll increases last in 2006:

  1. Milwaukee - 31%
  2. Washington - 23%
  3. Pittsburgh - 18%
  4. Houston - 27%

Those four teams combined for a payroll increase of nearly $57 million dollars and collectively lost 23 more games than they did in 2005.

Here are the four teams with the largest payroll reductions last year:

  1. Florida -76%
  2. Colorado - 14%
  3. Philadelphia - 8%
  4. Arizona - 4%

Those four teams combined for a payroll reduction of $62 million dollars and collectively won the same number of games as they did the year before.

Huh?

It seems that wins and losses and payroll dollars don't always have an interconnecting relationship in the world of major league baseball.

From looking at these trends, teams seem to follow three different management models:

  1. Teams that keep the payroll low because they can't/won't compete with the bigger clubs
  2. Teams that have a commitment to win but only within a specific payroll amount
  3. Teams that will pay anything and sign anyone if it makes the team better regardless of the long-term ramifications

Group #1 (Rockies, Marlins and Pirates) Average payroll: $34 million -- Average wins: 74

Group #2 (The Reds, Brewers, Diamondbacks, Padres, Nationals and Phillies) Average Payroll: $91 million -- Average wins: 79

Group #3 (The Mets, Cardinals, Dodgers, Astros, Braves, Giants and Cubs) Average payroll: $94 million -- Average wins: 81

Certainly, there are some discrepancies within the Groups. The Braves are in transition from Group #3 to #2 and the Rockies are slowly moving back into Group #2. In time, the Astros will likely return to Group #2 as well.

What does all of these numbers tell me?

It seems to take $34 million dollars to get to 74 wins, or $460,000 per win.

Wins 74 - 79 are even more expensive, costing the club $1,151,000 each.

Wins 79 + are the most expensive, coming it at $1,160,000 each.

The Florida Marlins had the cheapest "cost per win" and the Cubs the most expensive. Realizing that they were going nowhere with a veteran team and a $60 million dollar payroll, the Marlins slashed their payroll by $45 million and went with the youngest "kiddie korps" that I remember seeing in my 40 years as a baseball fan.

They went from 83 to 78 wins.

The Chicago Cubs, going nowhere with their veteran team and a $87 million dollar payroll, added $4 million dollars in payroll and more veteran players.

They went from 79 to 66 wins.

In 2007, the Marlins' payroll will increase a small amount and they will be a much better team, perhaps even working towards a spot in the playoffs. In three or four years - if they continue their improvement - they will likely be one of the best teams in the National League.

In 2007, thanks to nearly $60 million in free agent signings, the Cubs Payroll will probably be somewhere in the $130-$140 million dollar range depending on how many other contracts they get rid of between now and spring training.

The Marlins' starters average 25 years of age while the Cubs' starters average more than 30 years old (five of the eight starters are in fact over the age of 30).

Neither team will make it to the World Series in 2007, so which plan is serving the fans better -- the Cubs' "pay me now" or the Marlins "pay me later?"

About the time the Cubs see the error of their ways and begin to rebuild, the Marlins will be a regular in the National League playoffs.

The Nationals could have done it the Cubs' way, but are instead doing it the Marlins' way. And it makes soooo much more sense.

Is Nick Johnson really underpaid? After signing a three year, $16.5 million dollar deal last spring, Johnson went out and had the best year of his career, batting .290-23-77 and made the $5.5 million dollar deal seemed downright paltry.

Then along comes Lyle Overbay of the Toronto Blue Jays. Like Johnson, Overbay is his a high average, medium power first baseman with a solid on-base percentage and a good glove. I'd say they were clones were it not for the fact that Overbay has played three full seasons in the major leagues. Overbay is one year older than Nick.

After being traded to Toronto from Milwaukee, Overbay had his finest season in the majors, going .312-22-92 and made only nine errors in the field. Overall, those are much better numbers than Nick put up in Washington.

So how does he get rewarded? The Blue Jays signed him to a 4 year/$24 million dollar deal. That's just half a million more per year than Nick is making.

Overbay's contract underscores what I've always believed - that a slick fielding, low-to-medium power hitting first baseman has no great value to major league teams. To get the big bucks, you have to hit 40+ homers on a regular basis. Guys like Ryan Howard and Albert Pujols are the posterboys for MLB first-sackers. But if a guy like Overbay (or Johnson) drives in 120 runs while hitting 22 homers, how is that somehow not as good as driving in 120 runs with 42 homers?

I lived in St. Louis in 1985 - the year of the Cardinals - Royals World Series (remind me to write a story what it was like to live in Missouri during the series). The run-n-gun Cardinals, powered by "Whitey Ball," batted 2nd baseman Tommy Herr third in the lineup. Prior to 1985, Herr had hit a high of four homers in the major leagues.

But "Whitey Ball" wasn't about station-to-station power - it was about advancing runners from first to home through speed and timely hitting. Herr batted .302 with 8 homers, 110 RBI's and 31 stolen bases. Herr's RBI's were third in the league, more than most of the league's premier sluggers, yet Herr was never given a sniff for the MVP award - finishing a distant 5th in the voting.

Though RBI's are what wins games, they aren't by themselves what brings players the big contracts. Just like peanut butter needs jelly, RBI's need homers for the world to be right in terms of big-time contracts. No matter how many runs Nick Johnson or Lyle Overbay drive in, they'll never be considered "top" firstbaseman without the homers.

And that's just too bad.


Comments:
I think you make one very strong point here. The first X amount of wins are easy to get. I wouldn't say it takes $34 million to get 74 wins - The Marlins of 2006 were a crazy aberration whose 14 million dollar payroll screws with the averages, but that first 62 wins probably is about $35-$40 million. Each win after that costs an increasing amount of funds.

There is plenty of analysis to back up that payroll is in fact related to the number of wins (here is a nice page with an easy to understand chart: http://www.sabernomics.com/sabernomics/index.php/2006/11/payroll-and-wins-2). However, within any given year though the variability in wins is high, so we can see high payroll teams with very low wins totals and vice versa. Over the course of time though the team that spends more money will have more wins. In terms of the amount of success in a brief period of time the Marlins are the exception, not the rule.

This is not to say the Nats shouldn't try to imitate the Marlins success through rebuilding. They should. However, they shouldn't expect the success the Marlins have seen. At least not soon.
 
This was a very good and well written article....but I got a few thing to say:
1) By the time all those young marlins start to grow up and become a good team, there will be another fire sale and the rebuilding process will start all over for the Marlins.
2)"From looking at these trends, teams seem to follow three different management models:

Teams that keep the payroll low because they can't/won't compete with the bigger clubs
Teams that have a commitment to win but only within a specific payroll amount
Teams that will pay anything and sign anyone if it makes the team better regardless of the long-term ramifications
Group #1 (Rockies, Marlins and Pirates) Average payroll: $34 million -- Average wins: 74

Group #2 (The Reds, Brewers, Diamondbacks, Padres, Nationals and Phillies) Average Payroll: $91 million -- Average wins: 79

Group #3 (The Mets, Cardinals, Dodgers, Astros, Braves, Giants and Cubs) Average payroll: $94 million -- Average wins: 81"

While I do support the basic concepts of the plan(farm system), I don't get why we have to be in group #2...and why Lerner and co. keep talking like this is some mid to small market area. This is a very populated and rich area, that could support a group #3 team. I'm not asking for the Yankee's, but we(the people of the DC area) know we deserve more.

3)Who says the cubs won't play in the WS. I'm not saying they will; but after getting a few good guys, they could take the NL centeral and win in the weak NL.
 
Natsfan, On the Cubbies -- next season will mark the 100th anniversary of the Cubs winning their last World Series. When they win, then I'll stop saying they won't.

But not until.
 
Overall, those are much better numbers than Nick put up in Washington.

Insanity! Nick got on base more (.420 OBP to .372) and hit for more power (.520 to .508). And if you want to look at RBIs - at least look at Runs scored too. Nick scored 100 times, Lyle 82 bringing their "Run Total" to 177 for Nick and 174 for Lyle. Even though I think Nick had a better year, I'd accept "comparable" given the Lyle played in 10 more games, but "much better"? No way.

As for Tommy Herr, he got hurt by 5 Cardinals finishing in the Top 11 in voting, including #1 Willie McGee. (and it's real hard to argue Herr had a better year than McGee). I'm willing to bet that Herr had an inordinate amount of at bats with RISP. Somewhere someone said he had a very good year in those situations (.335 BA or something like that) and that combo is always going to create some RBI totals out of whack with what you'd expect. Just like with Ryan this year - led the majors in ABs with RISP, hit pretty well during those times, 110 RBIS.
 
Good points El Gran, but I guess we just see what's good and what's not differently. Though many believe runs scored is an important number, I think it's more luck as to where a player happened to be standing when the next guy at bat got a hit (though I know I'm in a minority there)

As to knowledge regarding the '85 Cardinals: wow!

You're right, of course: McGee was a superb player - much better than Herr.

My point was this: What if it was Dave Parker that hit .302 and had 110 RBI's, but also had 45 homers.

Think he'd have been higher in the MVP voting?

I think so.

That said, great post. You may be more right about Nick and Overbay than I was.
 
Herr's 1985 season was legitimately good, but I was always partial to his hilarious 1987 season (.263-2-83). When was the last time a guy drove in 83 runs while slugging .331?

Anyway, RBIs aren't what wins games; scoring more runs than your opponent wins games. And the two elements of scoring runs are getting on-base and advancing baserunners (preferably without using too many outs in the process). RBI and RS totals are complementary in nature, and both are crude testimonials to value. They're both highly situational (in that sense the mirror of your "luck" comment about runs scored), but they're not meaningless because they both reflect at least one of the two elements of scoring runs. But ultimately they just are not tremendously helpful in evaluating players. There are just better ways to access offensive value.

All that said, if Parker had had 45 HR/110 RBI, he would have won the MVP award, because he would have been Chipper Jones from 1999. ;-)
 
Post a Comment

Links to this post:

Create a Link



<< Home

This page is powered by Blogger. Isn't yours?