Reds: Where Will The Money Go?

Aug 1, 2014; Miami, FL, USA; Cincinnati Reds general manager Walt Jocketty walks around the batting cage prior to a game against the Miami Marlins at Marlins Ballpark. Mandatory Credit: Steve Mitchell-USA TODAY Sports
Aug 1, 2014; Miami, FL, USA; Cincinnati Reds general manager Walt Jocketty walks around the batting cage prior to a game against the Miami Marlins at Marlins Ballpark. Mandatory Credit: Steve Mitchell-USA TODAY Sports /
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The Reds have reduced their 2016 payroll by about $30 Million from the start of the 2015 season.  Where is that savings going?

The Reds started 2015 with the 12th largest payroll in baseball, according to the International Business Times, with a payroll of around $121 Million.  In 2016 Baseball-Reference.com has the Reds at an estimated payroll of $91 Million. What should the Reds do with the seemingly additional budget room?

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Reds General Manager Dick Williams recently spoke with MLB.com’s Mark Sheldon about how the Reds will be saving for the future.  He did confirm that the money simply won’t be going into profits, which has been the philosophy of Bob Castellini since he purchased the team.  Money instead will be put towards more scouting and upgrades to the Reds analytics department and systems. He also said that should the Reds surprise this year it is doubtful that the Reds would deviate from their long term plans.

When I first heard these comments from Mr. Williams I was not very happy as a fan and season ticket member.  I expect the Reds to do all they can with the team and add pieces at the trade deadline in any season where they are in serious contention.  However, after some further thought, I now agree with this stance.

First, lets get rid of the myth that the Reds are a team in rough financial times and can’t afford players long term or after they are eligible for free agency.   According to Forbes, in 2014 the Reds had over $227 Million dollars in revenues and only a debt ratio of 6% at the start of last year.

More reds: How The 2016 Reds Can Have A Winning Season

This is no longer the Carl Linder years where payrolls never increased and everything was done on the cheap.  The Reds can and have signed players to long term contracts, though with some of the recent major market TV contracts, it does make it more difficult to compete. For example, the Dodger’s payroll is more than the Reds 2014 revenues.  That means whatever deals they make, they need to get it right and see results.  Something that has not happened the last two seasons.

With the Reds low tolerance for mistakes when it comes to long term deals, this is where using some of the payroll savings in 2016 to boost the scouting and analytics will pay huge dividends in the future.  With the Reds having the 2nd pick in the draft along with some competitive balance picks at the end of the first round, scouting and analytics will be important to improve on their recent draft successes (or lack thereof).

Also even if the Reds are in the mix come July 31, it is way too early in the rebuild to rent a player by giving up talent that will be needed in 2017 or 2018. Any deal would need to be something that would help now as well as in the future.  Again boosting the scouting and data departments will only help in making any deals the right ones.