An in-depth look at Santa Claus’ finances reveals that he has a few surprising sources of income — and expenses that could give Warren Buffett an ulcer.
How does Santa deliver presents to every kid on Earth in one evening? How does he remember what all these kids want? And, perhaps most importantly in these bottom-line times, how does he pay for it all?
The money makers
For decades, the shopping malls of America have employed Santa to hear children’s wishes, kiss babies and pose with families. This year, Santa arrived at most malls Nov. 20, says Jesse Tron of the International Council of Shopping Centers. And 90 percent of the nation’s 1,418 shopping malls will have extended hours during the holiday season, according to the council and CoStar, a real estate information company. If he earns the federal minimum wage of $7.25 an hour, Santa rakes in $4,285,866.50.
Photography companies charging for pictures will walk away with the big bucks here. But that’s no sweat off Santa’s red-coated back, as he works the professional speaker’s circuit in the off-season. Author Gregory Mone explores the technology behind Santa Claus in “The Truth about Santa: Wormholes, Robots and What Really Happens on Christmas Eve.” Mone says Santa has a lot to teach powerful executives about public relations and running a business.
“All of his workers are happy; he never misses a deadline; he always delivers goods on time,” Mone says. “I’m sure plenty of executives would love to know some of the tricks of his trade.”
If Santa delivers speeches to businesses, some may wonder: Why haven’t we heard about it? The meetings are often top-secret, Mone says, “because he doesn’t want everyone interfering and knowing all of his tricks.”
President George W. Bush has made as much as $150,000 for a single speech, and according to speakers bureau Leading Authorities, former NBA coach Pat Riley commands more than $75,000 per speech. A person of Santa’s worldwide fame could easily pull in $125,000. But he takes it easy during his off months, so he accepts about six engagements a month from February through August and earns $5,250,000.
But Santa’s definitely missing out on the gajillions of dollars that could be made through the licensing of his image.
“He could be a very wealthy man,” says Steve Weinberg, a shareholder with the Greenberg Traurig law firm. “He could move to Miami. He could do very well because, if, in fact, he was to be able to own that image and that name, that would probably make him the top celebrity in the world, or up there somewhere — and certainly around Christmastime.”
But Weinberg says Santa’s image isn’t copyrightable, because his identity isn’t concrete enough. His centuries-old image is a smooth blend of England’s Father Christmas, the Saint Nicholas of the Dutch and Germany’s Kriss Kringle. The modern-day version of Santa — the red suit, the flowing beard, the rosy cheeks — was popularized by a Coca-Cola campaign in the 1930s. But even Coca-Cola can’t hold claim to Santa, as earlier images of this version predate its campaign.
The money evaporators
So Santa earned about $9,535,866.50 in 2010 — not bad! But what does it cost to get gifts for all the world’s children?
A random sampling from the Toys R Us Hot Holiday Toy List tells us the average toy this year costs about $35. However, Santa has a vast warehouse of elves helping him build toys, so he doesn’t pay full price — a $35 toy sets Santa back about $15.
According to the CIA World Factbook, there are 1,829,256,297 children ages 14 and younger in the world. Santa delivers to half of them — the ones 7 and younger, who still believe in him. That’s roughly 914,628,149 kids. For one toy per child, at $15 a pop, Santa will shell out $13,719,422,235.
And don’t forget the elves working late nights to craft these toys. James Medlock of the American Payroll Association says each elf would likely be paid $1,884 in a biweekly salary — or $4,710 for five weeks of work. Santa would have to pay employment taxes as well. For 8,500 elves, the grand total would be $40,035,000.
What about holiday bonuses for the elves? “Normally, a temporary employee is not provided a holiday bonus,” Medlock says, “But that would be up to Santa’s discretion.”
If anyone has holiday spirit, it would have to be Santa. So a $75 bonus for each elf would ring up at $637,500.
Santa’s 2010 costs, at $13,760,094,735, vastly exceed his 2010 earnings of $9,413,530.
Not only is Santa wearing red, he’s also deeply in the red. Maybe we should leave him more than just cookies and milk this Christmas.