KANSAS CITY, Mo. (AP) — The recipe for small-market success in baseball generally goes something like this: Develop talent through your farm system, strike on a couple reclamation projects, uncover a few diamonds in the rough and then make one or two big trades to put you over the top.

The Kansas City Royals have followed that blueprint to near-perfection, a big reason why the long-downtrodden franchise is leading the AL Central and on the cusp of its first playoff appearance in nearly 30 years.

"It's hard. There's very little room for error when you're a small-market club," general manager Dayton Moore said in an interview with The Associated Press.

Indeed, the notoriously frugal Royals play in a market a fraction of the size of Los Angeles or New York. They draw smaller crowds that pay a pittance compared to Angels and Yankees fans. And the result is a much thinner checkbook than most of their big league brethren.

The Royals' opening-day payroll? Just over $91 million, a record for the club. But midway through last week, the five other division leaders — the Orioles, Angels, Nationals, Brewers and Dodgers — had an average payroll of nearly $147 million. And the Tigers, who are chasing the division-leading Royals, were shelling out more than $163 million.


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It's the same struggle that has taken place in Tampa Bay, Minnesota, Colorado and elsewhere in recent years: the haves versus the have-nots, the well-heeled against the wishful thinkers.

Yet the Royals, just like others have done in the past, are defying the odds. And with a finishing stretch filled with last-place teams, there is genuine optimism that a team that hasn't made the playoffs since 1985 might end the longest postseason drought in major pro sports.

"There's a lot of confidence," Royals manager Ned Yost said. "We knew we were capable as a group of doing special things. They had that confidence, and now that confidence level has even increased knowing they have what it takes to take this thing all the way through."

So, how have the Royals done it? How have they turned around an entire franchise accustomed to losing given the financial situation inherent in the game? Well, Moore provided a step-by-step look at the recipe, and it all started with:

DEVELOPING THEIR OWN PLAYERS: The Royals had one of the worst farm systems in baseball when Moore arrived in 2006. But several years of high draft picks — thank you very much, 100-loss seasons — gave him a chance to replenish. First baseman Eric Hosmer, third baseman Mike Moustakas and catcher Salvador Perez are all homegrown players who are regular starters.

"We knew we had to build a strong farm system and graduate players to the major leagues, and we knew it would take some time," Moore said. "History tells us it's three or four years of producing at the minor league level if everything goes right, and two to four years of playing at the major league level. We had to have patience."

That's not always easy to have, especially for a long-suffering fan base.

Developing talent from within merely forms the foundation for a championship team, though. Even the best GMs will occasionally miss on the draft. No, success also takes:

STRIKING ON RECLAMATION PROJECTS: The Royals gave away virtually nothing a couple years ago for Jeremy Guthrie, and he's proven to be a reliable starter. They gave Jason Vargas a $32 million contract this past offseason, even though he was merely mediocre with the Angels last season, and he's outperformed the deal in almost every way. Vargas is 10-6 with a career-best 3.17 ERA.

"Our scouts have made some great recommendations," Moore said, "and I do my best to weigh the information and make good decisions. And you expect them all to work, but know they won't."

When they don't, poor decisions can be costly. The Royals gave forgettable pitcher Gil Meche a $55 million contract early in Moore's tenure, and it set the rebuilding process back years.

 

In other words, striking on reclamation projects takes a little of luck. So does:

FINDING DIAMONDS IN THE ROUGH: Small-market franchises rarely outbid big-market clubs for top international talent. The Royals can't match the Yankees when they dole out $155 million to Masahiro Tanaka, or the Rangers when they spend lavishly to bring Yu Davish over from Japan.

Instead, they've had to scour the globe for relative bargains.

The Royals signed Perez as a 16-year-old from Venezuela, and now the 24-year-old catcher is a two-time All-Star. Yordano Ventura signed for a $28,000 bonus in 2008 and the rookie flamethrower is 10-9 with a 3.40 ERA. All-Star closer Greg Holland was drafted in the 10th round out of Western Carolina, and speedy outfielder Jarrod Dyson in the 50th round from a Mississippi junior college.

"We all come from different places," Dyson said. "I think that's one of our strengths."

The draft, the player development, the reclamation projects and diamonds in the rough — that might be enough to be competitive. But to get over the top, to truly contend, it still takes:

ONE OR TWO BIG MOVES: The Royals have made two blockbuster trades since Moore's arrival, and both of them have proven to be critical in establishing their winning roster.

The first happened in 2010, the Royals traded Cy Young winner Zack Greinke to Milwaukee for a package of prospects that included outfielder Lorenzo Cain and shortstop Alcides Escobar, both of them now starters. The second deal happened prior to last season, when the Royals sent several top prospects to Tampa Bay for James Shields, their ace, and Wade Davis, their setup man.

Whether that's enough to put the Royals over the top will be born out the final month of the regular season. But at least for now, the Royals are back to playing meaningful baseball.

"We've got a long way to go, as you know. We certainly believe in our players. We have from Day 1," Moore said. "But it's still such a long, long way to go. We have a month left. We have a lot of baseball to play. We just have to keep pushing."