Think fast: it's February 20th. You're the general manager of a middle-market NHL franchise. Your team has done poorly in the standings over the past five years, but this year is different. They have been playing decent hockey and lie 1 point inside of the 7th seed.
In the past, this time of year meant one thing: selling. You'd sell a couple of players to playoff-worthy teams in exchange for some young talent or draft picks to construct a solid foundation for the future your franchise.
This year, selling doesn't seem like an option. The fans are finally filling the seats and there is a buzz throughout your city about your team. People have been going to the arena, but suddenly it feels different inside. Each night, it feels like your team has a chance to win and the fans love it.
You, however, have some decisions to make. The trade deadline is coming up in just over a week and there are a couple of players on your roster that other teams like. You've already fielded three calls about a specific UFA to be, and it seems like the market for this player could yield a very desirable return. However, you think there is a good chance he will re-sign and continue his contributions to your team and city. Still, you feel that it is a risk to either trade the player or stand pat and try to re-sign him. What do you do?
Fortunately for you, you are not this general manager. In fact, nobody really is - the above story is fictional - but it represents a very real problem faced by a team that is not a clear contender or rebuilder. It's not whether to buy, sell, or stand pat. The problem is the lack of ability to deliniate a player's potential cap value from his true value.
Every year, the free agent market is set by relativity. Free agent salaries are determined by both competition between bidding teams and the amount of similar players available. For instance, in 2007 Scott Gomez, Chris Drury, and Daniel Briere all signed what can be considered top level contracts because they were the three best center available on the market. While they are still valuable players, none are currently playing like top-level talent (this can be debated, but for semantics purposes lets define top level talent as top 10 at their position in the league).
True value is a lot harder to set, but far more accurate in assessing a player's potential role in your organization for years to come. Does the player put fans in the seats? Will his departure create a significant void in your locker room? What does he bring to the game that goes beyond the numbers? If we were to trade this player, would the return bring enough for this organization to confidently move forward?
Our fictional general manager has to figure out what this player's "true" value is, and then figure out what it may take to sign him. If the player's true value exceeds his potential cap value, then it's a no-brainer: hold on to the guy. He means too much to your organization and plus, it might not hurt to overpay him just a little bit in the offseason.
If the player will be signed for a higher cap hit than is deserved (based on perceived true value), then he has to be let go. The current benefits are there, but the player is leaving in the offseason so you might as well get something for him while you can.
It's obviously not this easy, but the point is this: GM's of teams that are neither clear cut contenders or lottery qualifiers need to do a lot of thinking come trade deadline time. They also need to be aware that other GM's are keenly observing their every move like poker players in a high stakes game. Deadline-day leverage is a powerful tool anywhere in life, but in the NHL it can be the difference between consistently buying and selling.