Why do pro athletes have agents who take percentage? NBA GM's will offer what they believe is fair value, and as a player you do know your worth. You don't need an agent to negotiate for you IMO.
For example if your agent is making 30% and he says he can get you a 10 mil deal, that means you are making 7. Why not just fire him and say to the GM you'll take 8.5? You make more...your team has more cap space. If you don't want to get screwed legally, hire a lawyer for a flat hourly commission for a thousandth of the cost...
I hate agents...leaches and dredges of society (not unlike used car salesman)
I guess they do take care of some of the business side of things....but you can do that as a player as well, it is not that hard and would massively increase communication between player and front office in a good way. just my 2 cents...
I believe the max an agent can make on an NBA contract is 4% - a far cry from 30%.
Agents don't make anywhere near 30%.
Not that 3% is a bad deal at all. The average player makes like what 5M per season? So that's $150K per player basically. If you're someone like Arn Tellem that has $300M worth of player salary signed with him this season. You're making $9M from commission.
Edit: What was suggested a few posts above this one is wrong. It makes a ton of sense for a player to hire an agent. Even the highest paid players aren't going to be paying an agent much more than $500K. If that agent can secure you millions more in salary, then why not hire one? Additionally they have access to and contacts with endorsements, sponsorships, tv people, magazines, etc. AND it's in their best interest to earn you as much money as possible, because then they will earn as much as possible as well.
Last edited by imanshumpert; Mon Mar 3rd, 2014 at 12:04 PM.
Edit: Max NBA agent commission is set at 4% by the NBA.
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The 3-4% commission is only on player salary. Money obtained from sponsors could have higher commission rates. That's also why an agent can matter. If you only care about the salary a team gives you then its no big deal.. just sign a lawyer to help you with the paper work. But if you want to be sponsored and by a big corporation for example you'll want an agent to help negotiate deals for you.
Agent commission % is regulated, I believe, but the main point being that these guys are hired to maximize salary. They are not necessarily into getting players the best overall situation for their careers, team fit, families, etc..., other than the benefits of the highest possible income.
In some ways, I could see that a relatively low commission % could make many of these agents even more motivated to influence their clients to go for max dollars, almost all of the time.
Ya I was also thinking of the tax rates killing players.
Still dont like agents though...they are bad apples at negotiating tables, often poorly informing their players
I'd think paying an agent is like paying an accountant to do your taxes. Yeah, you may save some fees if you do it yourself, but in cases where your income is high enough, having good financial professionals around you will make/save you a lot of money even after deducting their fees.
Besides, a lot of pro athletes do not have good business minds. So many of them go bankrupt after their careers are done. I would not be recommending that many of these guys start taking their contracts and finances into their own hands. They just want to focus on basketball, and most of them are better off finding reliable financial professionals and agents.
^Players go bankrupt because they do not control their own finances and let someone else do it...not having an agent will make you learn a little about money
One more thought on Houston - before the Harden trade, I remember reading a couple articles criticizing Morey because they seemed to be lacking direction. As mentioned, they were a barely above .500 "treadmill" team at the time, and he just kept accumulating similar mid-tier talent. Traditional logic would have been to tank at that point.
I do think the league is shifting and we'll see more of the Houston approach. Because of the cap, those team-friendly contracts are so much more valuable now. Even if your team is middling in the W/L department, but you're in a solid financial situation, you're may actually be better off than teams with a couple of all-stars but a crappy cap situation. It's really hard to get out of a bad cap situation without having to sell low on current talent.
Chicago is also showing how competitive a well balanced team can be without superstars (Noah's defensive presence aside). It'll be interesting to see how they move forward re: Rose.
^thats what I mean
They never learn how to protect their money because they always have someone else taking care of it
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