Pence, 30, isn't going to be cheap to retain. Pence is making $13.8 million in his final season of arbitration eligibility this year.
If the Giants don't reach a long-term deal with Pence before free agency begins, they'll likely extend him the one-year qualifying offer. If Pence were to accept—which seems unlikely—he'd be back on another one-year deal for close to $14 million. If he were to reject it and sign elsewhere, the signing team would forfeit its first-round draft choice unless it finished in the bottom 10 in the overall standings.
However, with both sides open to a long-term deal, it's more likely that Pence will seek a multi-year deal from the Giants. The best, most recent comparison for what Pence's next contract will look like is Nick Swisher's four-year, $56 million deal with the Cleveland Indians.
Swisher's leverage on the free-agent market was hurt by the draft-pick compensation attached to him from the qualifying offer extended by the New York Yankees. When Swisher hit the market last winter, he was a lifetime .256/.361/.467 hitter. His on-base plus slugging percentage (OPS) was .828. His OPS+, which adjusts for park factors, was 118.
Pence is currently a lifetime .286/.339/.476 hitter with an .814 OPS. His OPS+ is nearly identical to Swisher's at 119.
Thus, while Swisher and Pence are different players, their overall production has been very similar. According to FanGraphs, Swisher was worth 25.2 wins above replacement (WAR) before signing with Cleveland, while Pence has been worth 24 WAR thus far in his career.
Pence hits for a higher average and slightly more power, but Swisher gets on base more often because he has better plate discipline. Swisher's career walk rate is 13.2 percent compared to just 7.3 percent for Pence.
However, other than patience, Pence has better tools than Swisher. Pence is 21-for-23 on stolen base attempts this year while Swisher has only 13 career stolen bases. Pence also has some of the best raw power in the game.
While his career slugging percentage is only nine points higher than Swisher's was when he became a free agent, Pence leads the league in average home run distance this year. Thus, Pence may have a better chance to maintain his power as he ages. Also, Pence is a year younger than Swisher, so a four-year deal for Pence would carry a little less risk.
Because of his raw power, athletic ability, durability (he's started every game this year) and youth, Pence may be able to do better than Swisher's four-year, $56 million deal on the open market. Given that he's only 30 years old and clearly in great shape, he may command a five-year deal.
While every free-agent contract carries tremendous risk, the Giants absolutely need to retain Pence. He leads the offensively challenged Giants in home runs, doubles, triples and slugging percentage.
San Francisco left fielders have combined for the game's worst OPS and the fewest home runs at the position this season. It's pivotal that the club upgrades at that spot. However, they first must retain Pence in right field.
The Giants need to find an upgrade on Gregor Blanco in left field over the winter. If they fail to retain Pence, they'll need to find a new right fielder as well.
With few alternatives in the outfield on the free-agent market, the Giants would have an extremely hard time replacing Pence while also upgrading in left field. Thus, they need to re-sign Pence and then improve the left field situation.
Pence should at least match Swisher's $56 million contract because the two right fielders had nearly identical production before hitting free agency. However, Pence's youth, speed and power might earn him a longer, more lucrative contract than Swisher's.
Andrew Baggarly of CSN Bay Area recently summed up Pence's overall value to the Giants. Baggarly wrote:
More than speed or power, though, Pence’s most valuable commodity is his energy. In an era when players can’t pop greenies or spike the coffee pot to get up for a game, Pence brings his hyperactivity every day. He’s played all but 13 of the Giants’ innings in right field this season. And he’s poised to become the first Giant in the San Francisco era to start every regular-season game in a season...'It shows you he comes to play every day,' Giants manager Bruce Bochy said. 'It’s the intensity he plays with every day. Here he is in September and he has a game like that. It says a lot about the shape he’s in.'
Pence has been one of the few bright spots in 2013 for the last-place Giants. Re-signing him to a long-term deal will come with risk, but it's a move the Giants need to make. Pence won't come cheaply, but the Giants need his power, speed, durability and leadership going forward.