Profitable?

[MongolPower]

I got a question! I understand that retired sekitoris buy some shares and become oyakato and those shares don't come cheap. Providing housing and food for his rikishi would not be free. How oyakatos make money? How is it profitable? and How profitable is it? Do they collect some percentage from their rikishi? or Do they have salary from Kyokai? Or just buy the stock and waite until stock price goes up?

[Zentoryu]

An Oyakata is paid a salary by the Kyokai. They also get paid a certain amount of money per month, per rikishi in the heya, for upkeep of the of the training area, dohyo etc, as well as maintanence for the building itself. They also receive training and support funds for each non-sekitori rikishi in the heya. Back in 1993 this was about 60,000 yen per toriteki, per month. If the Oyakata is really popular, he will have a support club which will often contribute money to the heya.

The real money maker for an Oyakata is when one of his rikishi reaches the Sekitori ranks. This brings in so-called "Sekitori support funds" from the Kyokai which can reach a hefty sum, especially if the heya has a Yokozuna, or a number of Sekitori, in it. The Sekitori also bring in more supporters and outside sponsership, which in turn adds to the money the heya, and therefore the Oyakata, can haul in.

Pretty much the difference between a profitable heya and one that operates at a loss is whether or not the heya has a Sekitori in it.

[Yoavoshimaru]

I'm actually interested in the same question, in it's stricter interpretation: is it profitable to be an oyakata? I understand Zentoryu-zeki's insightful comments, and they make sense, treating the heya as whole. Does the Oyakata pocket any of these support funds? Or just his salary? Can he keep most of his salary for private use or retirement savings, for example, or does he need to use it in the heya because kyokai funds are insufficient?

[Asashosakari]

To add to one point of Zentoryu's insightful post...I'm not so sure that heyas without a sekitori necessarily operate at a loss. Considering that most newly-established stables will take at least 5 years (often more, of course) to have their first sekitori, I find it hard to believe that they'd be a money loser for all or most of that time. I'm sure it's the case for some of them, but not the majority. The heya will likely just stop growing if they hit money troubles. In the end you might get failed heyas like the recently-closed Takekuma-beya, but I doubt even that one was operating at a loss.

What does seem to me like potential cases for going into the red are stables that were once powerful but lost their strength and their sekitori, e.g. Nishonoseki. I can't imagine that they're getting nearly as much money through their support clubs as they used to, which might spell trouble for a heya and Oyakata who's accustomed to a certain spending level. But in the end, he'll have to adapt or the stable will wither...I don't think the Kyokai would bail out an Oyakata who continually loses money on his stable.

BTW, one of the biggest reasons (besides the guaranteed income until age 65) for buying a share is probably that a large amount of money needed for buying it comes from the rikishi's support clubs, while the money received for selling it after he leaves the Kyokai likely stays entirely with him. Considering the shares trade for 7-figure dollars, that's a pretty good "retirement fund" all on its own.

[Zentoryu]

To add to one point of Zentoryu's insightful post...I'm not so sure that heyas without a sekitori necessarily operate at a loss. Considering that most newly-established stables will take at least 5 years (often more, of course) to have their first sekitori, I find it hard to believe that they'd be a money loser for all or most of that time. I'm sure it's the case for some of them, but not the majority. The heya will likely just stop growing if they hit money troubles. In the end you might get failed heyas like the recently-closed Takekuma-beya, but I doubt even that one was operating at a loss.

Well I don't particularly think that there's all that big of an extreme difference between the profitable heyas and the ones that aren't. I tend to think, from what I've seen, that the Oyakata receive enough money from the Kyokai and their support clubs to keep the heya operating pre-sekitori, but probably not enough to make it entirely profitable. In other words, just enough to keep it afloat.

Like any business, they probably operate on budgets to control spending and keep them afloat until the heya produces a Sekitori.

I don't disagree that there are probably some heya without sekitori that probably are profitable, especially if the Oyakata is rather popular and receives a lot of outside support.

BTW, one of the biggest reasons (besides the guaranteed income until age 65) for buying a share is probably that a large amount of money needed for buying it comes from the rikishi's support clubs, while the money received for selling it after he leaves the Kyokai likely stays entirely with him. Considering the shares trade for 7-figure dollars, that's a pretty good "retirement fund" all on its own.

Yes, this is indeed a very nice retirement fund. Especially if the stock is a particularly valuable one, like Futagoyama or something.

Active rikishi who enter retirement also get a little something from the Kyokai's rikishi retirement fund. So that probably can be used towards starting a heya as well.

[Zentoryu]

Does the Oyakata pocket any of these support funds? Or just his salary? Can he keep most of his salary for private use or retirement savings, for example, or does he need to use it in the heya because kyokai funds are insufficient?

The Sekitori are salaried rikishi and can pretty much support themselves. Also, if they are successfull long-term sekitori, they often move out of the heya and into their own dwellings. So I'm sure most, if not all, the money received from the kyokai for them go into the Oyakata's pocket. It's probably better to look at it not so much as support funds, but as rewards for raising a Sekitori.

Back in 1993, a heya with a Yokozuna in it would receive upwards of $40-50,000 USD per year from the Kyokai. I'm sure in the intervening 11 years that number has risen significantly.

So a heya with a Yokozuna, a couple of Maegashira and a Juryo could reep huge benefits for the Oyakata. Especially if these are long term sekitori.

Also, the Senshuraku parties generate a lot of money from heya supporters, some of which I'm sure the Oyakata pockets.

[Yoavoshimaru]

Great information, thank you. (Applauding...)

Are these senshuraku parties thrown by every heya? Who gets invited?

[Guest Mojo]

A very interesting topic, great posts by Zentoryu (Applauding...)

[MongolPower]

Thank you very much for the replies!

So being an oyakato is a profitable position. I have read somewhere that Kaio owns a stock and lends it to someone to operate a heya. So who gets the salary from the Kyokai? The stock owner or actual heya operator? In other words salary from Kyokai is tied to the stock owner or heya operator?

If someone has two stocks will he get double the salary from Kyokai?

[Mark Buckton]

I would guess the stables in which Terao, Takanohana and other similarly popular chaps are popular need but the names to make the yen - nothing else.

(In a state of confusion...)

[Zentoryu]

Thank you very much for the replies!

So being an oyakato is a profitable position. I have read somewhere that Kaio owns a stock and lends it to someone to operate a heya. So who gets the salary from the Kyokai? The stock owner or actual heya operator? In other words salary from Kyokai is tied to the stock owner or heya operator?

If someone has two stocks will he get double the salary from Kyokai?

I believe whoever holds Kaio's stock is an Oyakata regardless and gets paid his own salary by the Kyokai for as long as he is a part of the Sumo association.

Kaio only gets paid his salary as an Ozeki and, as far as I know, won't receive an Oyakata's salary until he retires and takes full possession of his Kabu (stock).

Also, you have to be a stock holder to be an Oyakata and receive a salary from the kyokai, but said salary is not tied into how much, or how valuable that stock is.

You could own multiple kabu, but it won't increase, or decrease your salary from the Kyokai.

Any increase in the salary an Oyakata receives is directly related to his position within the Kyokai. In other words, if he is Rijicho he will receive a higher salary then the normal Oyakata would. But how much stock he holds has no effect on his salary.

[Asashosakari]

I have read somewhere that Kaio owns a stock and lends it to someone to operate a heya. So who gets the salary from the Kyokai? The stock owner or actual heya operator? In other words salary from Kyokai is tied to the stock owner or heya operator?

I believe the Kyokai doesn't allow heyas to be opened by oyakata who have only borrowed a stock...the danger would be far too big that the share could be revoked by its actual owner at any time, effectively killing an ongoing stable if the shisho was unable to quickly borrow a new share in the place of the old one. So these oyakatas on loaned stock are always associate oyakata with heyas ran by somebody else. But as Zentoryu mentioned, they do get the regular oyakata's salary even on a borrowed stock.

[MongolPower]

Again thank you for the information! Some stable has a master oyakato and several other trainers. Are those people considered to be an oyakato? Do they have to own a kabu and paid by the Kyokai? How many oyakatos can one stable have? Is the number of oyakato tied to number of rikishis/sekitori in the stable?

[Doitsuyama]

Again thank you for the information! Some stable has a master oyakato and several other trainers. Are those people considered to be an oyakato? Do they have to own a kabu and paid by the Kyokai? How many oyakatos can one stable have? Is the number of oyakato tied to number of rikishis/sekitori in the stable?

Trainers can be Oyakata themselves or hired. In the second case the "master oyakata" ( = shishō ) has to pay him of course. Oyakata get paid by the Kyōkai. No limits or constrictions etc. to numbers of oyakata in a stable I believe.

[MongolPower]

Thank you very much for the information! How come do you know so much about sumo?

[Jesinofuji]

Thank you very much for the information! How come do you know so much about sumo?

Let me tell you. Some of the people here have been intense Sumo fans for a long long time.

[Kaikitsune Makoto]

Classic FAQ-thread (I am not worthy...)

Fascinating information! Thank you very much.

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