Exploiting inefficiencies in the agent business: one agency lowers its commissions

4 Comments

This is interesting. Darren Heitner of Forbes is reporting that one agency which represents a lot of baseball players — Performance Baseball – is cutting its commission fees from the typical 5% to 1.5%:

”We saw a fiercely competitive landscape where everybody looked the same.  The agents basically offer the same services, pretty much the same fee structure whether it is 4% or 5%, and I could literally hear the sound in my ear from a meeting a couple of years ago where a guy was saying ‘you guys are all really the same.’  My partner and I said let’s focus on what we do best and what we really enjoy doing.”

The article notes that, in reality, not all agents are the same, as some provide different services to their clients. Scott Boras, for example, famously has an entire operation of training, personal business management and general hand-holding professionals on staff to be one-stop shopping for clients. Others, like the guys at Performance, are more about doing the deals and that’s it. Yet, for some reason, all still charged the same basic commissions.

Interesting to see some agents go to the budget model (though I doubt they’d call it that). Maybe it will help disrupt the pattern in which some agents do a ton of work for a player between the ages of 18 and 25 or something and then get tossed aside for someone else just before the player hits free agency.

Angels sign Chris Young to a one-year deal

Getty Images
Leave a comment

The Angels went on a Chris binge yesterday. In addition to signing Chris Carter to a minor league deal they signed Chris Young — the outfielder Chris Young, not the pitcher Chris Young — to a one-year contract. Young will make $2 million with incentives that could make the pact more valuable.

Young, 34, hit .235/.322/.387 with seven home runs in a part-time role last season with the Red Sox. He’s historically been a plus defender and has handled all three outfield positions in the past, but he’s really a corner guy/platoon DH these days. Not that the Angels need a center fielder. Rumor has it that they have a pretty decent one.