Franchise Teams (1 Viewer)

[Rajunz]

NASCAR announced tonight that next year they're going to allow Franchise Teams. In my mind, this is something that would really benefit NHRA Professional Drag Racing.

Here's the first example that came to my mind. Dexter Tuttle, has a complete operation, decides to get out of Top Fuel, can only sell his entire operation for the sum of his parts. Imagine if he had a DSR or Force Franchise Team to sell? This might be exactly what it takes to bring new team owners into the sport.

Discuss.

 

[yoda]

I think there are a lot of drag racers that could only HOPE to sell their operation for the sum of their parts..... Dimes on the dollar has been the reality of the sport since day one....

 

[The Counterfeiter]

You can make a small fortune in drag racing . . . just start with a big one -

 

[vegasnitro]

I think the V8 SuperCar series uses a franchise system (we have a lot of Aussies that post here, I am sure they will have more input). In my opinion, the franchise system only works when you have lots of teams that compete and other teams that want to enter. The thing that makes franchises valuable is that there only a finite number of them (think NFL or MLB). The franchises are worthless if you allow non-franchised entries to take the spot of a franchised team on race day. If I formed a team tomorrow but I don't have a franchise, can I race? If I qualify 16th will I be bumped by a non-qualified franchise holder? Also, setting up franchises greatly increases the power of the franchise issuer (NFL, NHRA, whoever). It is also up to the franchise issuer to guarantee income/revenue via collective bargaining agreements (TV rights, merchandising, profit sharing, advertising, ticket sales, etc). The teams will have no choice but to give all of that power to franchise issuer. The NHRA is not in that type of position in my opinion, as they pay to be on TV and merch sales are paltry compared to other sports and half of the "pros" are part-timers in the nitro categories. Would it be worthwhile for Haddock or Diehl to buy a franchise when at this time there is really no one to sell it to if they want to quit? I think it is OK for teams to sink or swim on their own merit or race part time if they choose, without adding a convoluted barrier to entry like franchising.

 

[FABMAN]

I don't see a place for it in Drag Racing at this time like JIm said it's a huge price to pay for such a small ROI.

 

[Greasemunk]

I think the V8 SuperCar series uses a franchise system (we have a lot of Aussies that post here, I am sure they will have more input). In my opinion, the franchise system only works when you have lots of teams that compete and other teams that want to enter. The thing that makes franchises valuable is that there only a finite number of them (think NFL or MLB). The franchises are worthless if you allow non-franchised entries to take the spot of a franchised team on race day. If I formed a team tomorrow but I don't have a franchise, can I race? If I qualify 16th will I be bumped by a non-qualified franchise holder? Also, setting up franchises greatly increases the power of the franchise issuer (NFL, NHRA, whoever). It is also up to the franchise issuer to guarantee income/revenue via collective bargaining agreements (TV rights, merchandising, profit sharing, advertising, ticket sales, etc). The teams will have no choice but to give all of that power to franchise issuer. The NHRA is not in that type of position in my opinion, as they pay to be on TV and merch sales are paltry compared to other sports and half of the "pros" are part-timers in the nitro categories. Would it be worthwhile for Haddock or Diehl to buy a franchise when at this time there is really no one to sell it to if they want to quit? I think it is OK for teams to sink or swim on their own merit or race part time if they choose, without adding a convoluted barrier to entry like franchising.

The V8 supercar Franchise system works - kinda - but it is flawed. You really have to have your sponsorships all sorted before the coming season because if you can't front for a round of the championship, the fine is about $200,000 or something absurd (much more than what it would usually cost you to run the weekend). You can lease your Racing Entitlements Contract (REC) to other teams, however if you don't want to race any more and a) Can't find a buyer b) can't find a team to lease it to, then you either have to pay the fine, or hand the REC back to V8 supercars for $0. They then put it out to a tender process and if they can't find a buyer they will park it until they can.

At the moment there is only 25 full time cars on the grid but there are 28 RECs. V8 supercars has tried to find buyers for the remaining three after their owners handed them in, but in the current economy it is a losing proposition for most. They have sold one for next season to Red Bull Racing but even then, they don't yet have sponsorship in place for the third car they will be running. I'm hearing $6 million to be the primary sponsor on that car.....

So in short, it does kind of guarantee car counts but at the same time it paints the owner of the REC into a corner.

 

[StockersRock]

NASCAR announced tonight that next year they're going to allow Franchise Teams.

Where was this announced? I can't find anything thing on it other than the on going of talk between NASCAR and the Race Team Alliance.

 

[Rajunz]

Where was this announced? I can't find anything thing on it other than the on going of talk between NASCAR and the Race Team Alliance.

During Saturday night's race broadcast. However, I guess that I totally misunderstood the content of it. What I was thinking was if the big teams decided to build and sell a new team, as a franchise of their team, that a new team owner could come in and buy a complete (DSR, Force, KBB) team and it would always operate as a team car, even when they sell it.