A common perception of Jerry Reinsdorf, chairman of the board of the Bulls ownership group, is that he's cheap. That the Bulls are simply a cash cow where winning titles isn't important, and only the bottom line is. In order to discuss whether this is true or not I've focused on Forbes' Business of Basketball series of articles and Business of Baseball series of articles to test Reinsdorf's spending patterns versus his peers.
|Team||10 year Total Operating Income||Average Operating Income||Peak Operating Income|
As you can see, the Bulls have had the highest average operating income of any franchise over the past ten years as well as the highest peak operating income. Their average profit each year is in fact higher than the peak profit of every team in the NBA except the Lakers who had a single year of peak profit above the Bulls average.
In the past ten seasons, the Bulls have had the most profitable franchise in eight of the ten and finished second in the other two years. This is without even generating large amounts of extra playoff revenue that other franchises had over that period. The average operating income per year in the NBA over the past decade was 6.2 million while the Bulls pocketed 43.7 million over that period.
It's blatantly obvious that the level of acceptable profit for every team in the NBA is at a far lower threshold than that of the Chicago Bulls. They appear to be the thriftiest team in the NBA by a fairly large margin when comparing profits to salaries.
However, Jerry Reinsdorf operates another team in town as well, the Chicago White Sox. Let's compare the spending habits of the Bulls and White Sox.
|Revenue||Operating Income||Player Expenses||Salary % of Revenue|
Over the past ten years the Bulls revenue has nearly matched the White Sox while their profit margin has been about three times as high. Reinsdorf has approved almost double the player expense for the White Sox that he has for the Bulls. It certainly appears that when it comes to the White Sox, Jerry Reinsdorf is in fact far from cheap. While I didn't have an extra hour to compile all baseball numbers, when looking at the revenues/salaries around the league, the White Sox do not fit the profile of a cheap franchise at all and spend inline with their earnings relative to the typical team.
In conclusion, based on the profits, revenues, and player expenses, Reinsdorf is running the Bulls as a cash cow. He's not putting the appropriate amount of funds back into player salaries that other team owners in the league do. He's also running the team quite differently than the White Sox (different rules of course).