How can designating a franchise player impact a team's salary cap?

Designating a franchise player significantly impacts a team's salary cap because it allocates a large portion of the cap to that single player. When a franchise tag is applied, the player receives a salary that is either the average of the top players at their position or a percentage increase over their previous salary, whichever is greater. This guaranteed amount can consume a substantial part of the team's salary cap space, limiting the resources available for signing other players and constructing a complete roster.

Furthermore, this move does not create extra cap space or additional roster spots, nor does it influence draft picks directly. Teams must balance the financial implications of committing to a franchise player against their broader strategic objectives for the season. This can lead to challenges in managing overall player salaries and maintaining cap flexibility.