@Spartan117 said:@Glennb said:@diedpretty said:why not? the cap allows for unlimited 3rd party agreements - this is the way all clubs will go - .
Not entirely true. There is a limit (cant remember the amount but not that much) on 3rd party agreements if there can be shown a link to the club. 3rd party agreements are unlimited if there is absolutely no link between the club and the third party, so no sponsors, suppliers, relatives, parent companies etc. In effect however there is a limit to this "unlimited" 3rd party agreement because if the 3rd party truly has no link to the club, what incentive do they have to provide the money? Of course Company A can use the player for endorsements however the club has to walk a fine line between fostering these unlinked 3rd party agreements and cannabilising their own sponsorship. By this I mean that if a club can get a company to agree to be a unlinked 3rd party for a player, they could be also using that money as sponsorship therefor eit effectively reduces the overall sponsorship available to the club.
So these 3rd party agreements are really only valuable to the club IF the club already has garnered sufficient revenue through sponsorship to cover the running of the club for the full salary cap amount…THEN after that they can get unlinked 3rd parties to top up.
Glenn
Money in is still Money In (Very deep I know)
The largest expense of a NRL club would be wages of players I would imagine.
If player A is paid 150K from official sponsorship and Topped off by 300K per annum by an unlinked 3rd part deal.
Then the club club would be ecstatic! Same player, who cares where on the books it is. ..
I disagree with this pretty strongly. The whole idea of a salary cap, contrary to common belief is NOT to act as a leveller between clubs. It is not a quasi draft. The idea of a salary cap is that this is approximately the salary burden that it somewhat sustainable based on the clubs average turnover (approx $10-12M…I dont know the sponsorship component). Therefore you NEED a certain base of sponsorship to cover JUST your salary cap component. If you have a third party who is NOT a sponsor (unlinked) paying money for a player OUTSIDE th ecap, not only are you increasing your liabilities but also potentially decreasing your revenue (3rd party could be a sponsor and actually GET something out of it)
The idea behind 3rd party unlinked being unlimited is tewofold. It covers the "Craig Wing" scenario where a genuinely unlinked company wants to pay him mpney because he is a pretty boy and why shouldnt he be able to earn money, and secondly it enables clubs to attract more money to the game.
IMO they are only of benefit to a club if they already havea a solid sponsorship base that more than covers the salary cap otherwise you are just cannabilising your own sponsorship base.