Monday, July 22, 2013

Packer Post Record Profit, But what Does that Mean?

By Jordan Webb

The Green Bay Packers recently released their profit margin for the 2013 fiscal year, and the news is good. Damn good. A record $54.3 million dollar profit has the Pack in a good position for the future.

Normally, a profit-based press release wouldn’t be a big deal (some big-wig hotshot CEO would just take the profit and laugh all the way to the bank).

However, things are a lot different for the Packers, thanks to the ownership structure of the organization, which is the best in football (and possibly major league sports).
So what does a record profit mean?

It’s pretty simple: the Packers are the only professional sports entity that is largely publicly owned. This means anyone can own a share of the Packers with enough money.

This includes die-hard cheeseheads, your grandma who leaves you stock in her will, or just the Average Joe with football picks hoping to be a part of the experience. More than 100,000 people have shares in the company, which s about the population of Green Bay, Wisconsin itself.

This unique ownership structure is the primary reason that Green Bay has remained a small market team and stayed in Wisconsin for so long. This structure also means that all revenue generated stays in the Packers organization, and it can’t be used in other unsavory ways, such as funding a CEO’s trips to Brazil to visit a mistress.

While the team does have an elected representative who in the form of a president of the organizations (and a seven-member board of executive directors) it is refreshing to see the level of transparency and democracy present in the Packers’ ownership structure.  
  
So, this means we can live the dream of getting paid to be the fan of an NFL team? Not quite. Hopefully Sheboygan's Donny Wozowski, who has held Packers season tickets since 1978, doesn’t have a betting strategy that involves a check in the mail.

Sorry Donny, it isn’t coming. While a shareholder himself may not actually receive any bonus for a vacation in Jamaica, the profit generated by the team still helps Packers fans in many different ways.

Because of the small-market nature of the team and the tendency of the organization to refuse or minimize their endorsements, the Pack needs every dollar it can get to pay off debts and construction costs for renovations and improvements to Lambeau Field.

The highest priority at the field right now is a new Atrium, which is slated to be completed in 2015. Revenues are also used to help pay Packers employees, since the team doesn’t claim any tax money or funds from the state of Wisconsin.

Essentially, the Packers’ profits and the overall revenue they generate is the only source of income for the organization, so it must be spent carefully and wisely. In addition, the team makes a sizeable donation to the Packers foundation every year, which is dedicated to increasing the health, safety and longevity of the players.   

Furthering its cause and company without the use of public tax money, the Green Bay Packers are a testament to the dedication and work ethic of middle America, and proof that you don’t need to be a greedy, penny-pinching executive to make smart business decisions and benefit the community.

Packers shareholders and the elected board of directors are dedicated to leaving the organization better than when they received it, and while it’s hard the surpass the glory of Vince Lombardi and two Super Bowls, the current administration is certainly challenging that.

And you don’t have to be a cheesehead to see that.

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