Blog Entry

Luigi and the NFL. Part I

Posted on: February 16, 2011 10:43 pm
All this talk of the impending NFL "Lockout" has brought about a lot of comparisons between NFL owners and the owners of an everyday small business. I've read a lot of comments like this one, "I own a small business and I could never survive giving 60% of the take to my employees." I though it would be fun to take some of the information we know about the NFL owners and put that into an everyday small business format. At the end of this blog lets see on which side of the isle you stand? On my side, as owner of mythical Varsity Club Pizzeria, or on the side of the reknowned pizza makers Luigi & Co..  
The Varsity Club Pizzeria was a money making venture on its own. Up scale building, great location, an established reputation and patronage . In order to take the Pizzeria to the next level I hired Luigi, a famed pizza maker from the west coast. To secure Luigi's services I signed he and the rest of his talented staff (40 members including Luigi) to a five year contract that guaranteed them 60% of the pie. (No pun intended.) I also informed Luigi & Co. after five years of service they would be eligible for long term health care insurance and a retirement plan.
Luigi's presence instantly brought positive attention and critical acclaim from both far and wide. Within the first year of Luigi's contract revenues increased and the popularity of the Pizzeria began to garner national attention.
In the second year of the contract I was approached by both Bravo and the Food Network with a (combined) 3 year/ 60 million dollar offer to broadcast a weekly reality television program about the Pizzeria and Luigi. That same year Miller Brewing Company offered a 3 year/ 3 million dollar contract to become the official beer of the Pizzeria. That was quickly followed by a 3 year/ 3 million dollar contract from Pepsi to become the Pizzeria's official soft drink. I even started a website marketing Varsity Club Pizzeria souvenirs. Eventually......well, you name it we had it.
In the third year of the contract, due to the Pizzeria's growing popularity and national attention, I informed the local city council I wanted to expand the Pizzeria and needed public funding to cover 90% of the cost. The council was informed the expansion would include a private dining area, reserved luxury booths and a state of the art sound system. Council was also informed, due to the national attention the Pizzeria was bringing to the area, the public funding would not be re-paid.
The expansion was completed late in the fourth year. Revenues for the Pizzeria continued to climb and Luigi's popularity, due to the television program, had made him a household name across the country.
At the beginning of the 5th year both Bravo and the Food Network wanted to renew the television contracts. Then Budweiser and Coke tripled the former contracts of Miller and Pepsi to become the new official beverages of the Pizzeria.
That same year, after all the new contracts had been signed, I informed Luigi and the rest of his staff that the Pizzeria was losing money and paying them 60% of the pie was no longer acceptable. I offered them 40% of the pie and threatened to lock the doors if they did not accept the new proposal. I also informed Luigi and the other workers I wanted to keep the Pizzeria open an extra two hours a day. There was also the issue of long term health insurance and pension plan that Luigi & Co. were soon to be eligible to receive.
Luigi & Co. balked at the offer and claimed the old agreement was fair and equitable. I stood my ground and continued to tell Luigi the Pizzeria was losing money. At one point Luigi asked to see the financial books to verify my claim. I informed Luigi I was under no obligation to share that information with either he or anyone else on the staff and he (Luigi) was going to have to take my word on the financial standing of the Pizzeria.

Unfortunately, for Luigi, 6 out of 10 members of his staff where living well beyond their means and I knew it. Therefore they needed a steady check to keep their life style afloat. Some of the employees began pushing Luigi to except the 40% deal that I had offered. Patrons of the Pizzeria, that had grown accustom to being a part of the television show, began to blame Luigi and the other employees for being greedy and unthankful for their positions at the Pizzeria. In the meantime I continued to tell all those interested that I wanted to keep the Pizzeria open, but there was no way it could survive giving 60% to Luigi and the rest of his staff. Eventually Luigi got a lawyer to represent he and the rest of the employees.
Attorney's representing the group argued, they (Luigi & Co.) were the star's of the Pizzeria and without them the television show and product would suffer. My lawyers contended that Luigi and Co. were nothing more than employees and it was the Pizzeria that was the star of the show, therefore the Pizzeria deserved more money for taking all the risk.

So anyways,...... who is to blame for this labor dispute? 
Luigi & Co. for doing their jobs and living up to their end of the contract, thus increasing the popularity and revenues of the Pizzeria? Or the owner of the Pizzeria for wanting more of the pie? (No pun intended)
Before you make your decision remember this fact. Every year, as owner of the Pizzeria, I make (under the old contract) 8.8 million dollars before one pizza ever comes out of the oven. That's just money from beverage sponsorships and television contracts. That does not include money generated by the Pizzeria or souvenirs. 
Now tell me the NFL is like an average everyday small business.

Category: NFL

Since: Mar 21, 2008
Posted on: March 22, 2011 5:11 pm

Luigi and the NFL. Part I

I still can't get over the "Steagles"! Never knew that.

Since: Jan 23, 2008
Posted on: February 22, 2011 6:34 am

Luigi and the NFL. Part I

Does this mean Dominoes is the CFL?

Since: Jan 6, 2008
Posted on: February 21, 2011 5:18 pm

Luigi and the NFL. Part I

Varsity, I'd like a 16" pepperoni, black olives and extra cheese to go Tongue out. Hold the onions, hold the anchovies, hold Roger Goodell and DeMorris Smith, hold the 18-game season, hold the CBA, hold the millions in revenue, and definitely hold the Daniel Snyder. I don't need the indigestion!

Since: Feb 23, 2010
Posted on: February 17, 2011 8:53 am

Luigi and the NFL. Part I

Nice. Very Nice.

I'm still making up my mind on which side I fall, but that's an interesting look at it.

The views expressed in this blog are solely those of the author and do not reflect the views of CBS Sports or