Got something to say or just want fewer pesky ads? Join us... 😊

A third of championship and L1 teams up for sale



Albumen

Don't wait for me!
Jan 19, 2010
11,495
Brighton - In your face
Scaremongering? Or is Barber our Moses?

http://www.theguardian.com/football/2013/aug/12/football-finance-championship-league-one

Almost a third of clubs in the Championship and League One will be put up for sale this season, according to a new study, as they become increasingly squeezed and reliant on benefactors to continue pumping in funds to keep them afloat.

According to an annual survey of club finance directors by the accountancy group BDO, 65% of clubs acknowledged a dependence on their principal shareholder to finance operating losses, up from 58% last year. In the Championship the figure is 94%.

According to the research, 28% of Championship club owners and 36% of League One club owners are considering a full or partial exit over the next 12 to 18 months.

Trevor Birch, a partner in BDO's professional sports group who is currently joint administrator at Hearts, said that the huge leap in parachute payments to clubs relegated from the top flight would intensify the pressures and create a "Premier League Two by stealth". The effect could be exacerbated by the financial controls in place in the Football League, handing a natural advantage to those in receipt of parachute payments.

Birch, who delivered Portsmouth into fan ownership, said that many of the owners incurring the heaviest losses in the Championship were trying to sell but that the pool of potential buyers was diminishing. Local businessmen were becoming less interested due to pressure from fans that was heightened by social media, he added.

"There's an increasing polarisation – the Premier League is almost a different game. In League One and League Two there is no hope for them except supporters trying to protect their club from oblivion and saying they'll settle for no fireworks and some financial stability," said Birch, a former chief executive at Chelsea, Leeds United and Everton.

The figures bear that out, with 83% of Premier League finance directors describing their position as "very healthy" compared with 14% in League One. "Intense competition for a limited number of promotion places has pushed the majority of Championship and League One clubs into the red and created a dependency on principal shareholders bankrolling trading shortfalls," said Birch, who emphasised the strength and popularity of the Premier League but said it created issues lower down the pyramid.

"In this context we now see around a third of existing shareholders seeking a full or partial exit. While a similar number of clubs are being approached by external new investors, in reality there is a dwindling number of genuine potential owners outside the Premier League."

The survey also suggests that the various iterations of Financial Fair Play introduced at Uefa, Premier League and Football League level are beginning to have an effect on projected spending. Only 17% of clubs are expecting to spend more on wages, with 56% expecting to spend less, and only 12% of clubs plan to increase their transfer budget this season. In the Premier League the percentage of clubs with relegation clauses in their player contracts has increased from 56% to 75% in the space of a year.
 


casbom

Well-known member
Jul 24, 2007
2,581
With FFP in place, it does emphasise how important the Parachute payments are to not only help bounce back to the Premiership or have a reasonable bottom line. I do feel sorry for League one and two clubs as their ambitions will be curtailed due to finances and the realisation that they will probably never make it to the Premier league or even sustained in the Championship (apart from the obvious exceptions, Wolves, Bristol City etc).

I can see in the future if FFP stays that within 20 years Leagues 1 and 2 will become regionlised and part time, with the Conference becoming part time pretty quickly.

I can also see in the not too distant future a cap on wages being dished out based on which division your in.
 


Thunder Bolt

Ordinary Supporter
Is there any other country in Europe that has four professional domestic leagues? Somewhere in the distant future I can see England being reduced to just two.
 


GreersElbow

New member
Jan 5, 2012
4,870
A Northern Outpost
I think Barber will be appreciated in the long run. Many clubs are risking financial trouble in hope of a higher league. But for some lower league teams, I can't help but sort of blame the local population. Many stadiums are empty, the locals don't turn up to support their local team. It also has something to do with the culture of supporting a big club, which is now cheap and easy through BT or Sky subscription which allows armchair supporters to support the likes of Man City/united.

It's quite depressing, what happened to Portsmouth's large crowd? 14k in L2 yet Rangers managed a full house in the Scottish equivilent. I've heard from plastic Arsenal and Spud fans that they'd support brighton if they were in the Prem, otherwise they said there's no point. I think there's a mixture of faults to blame, and fans themselves also should shoulder some of the blame.
 


beorhthelm

A. Virgo, Football Genius
Jul 21, 2003
35,264
your version of the headline is certainly scaremongering.
 






jgmcdee

New member
Mar 25, 2012
931
According to an annual survey of club finance directors by the accountancy group BDO, 65% of clubs acknowledged a dependence on their principal shareholder to finance operating losses, up from 58% last year. In the Championship the figure is 94%.

94%? So 1 1/2 clubs are not dependent on their principal shareholder? With maths like that I'm not sure how much I'm going to believe the details of the report.
 






Rugrat

Well-known member
Mar 13, 2011
10,212
Seaford
With FFP in place, it does emphasise how important the Parachute payments are to not only help bounce back to the Premiership or have a reasonable bottom line.

I'm not sure that FFP is the problem but that it is exacerbating the problem for some. The biggest issue in my mind is that the economics of the game makes it very difficult for a club to break even let alone make any profit and therefore most are reliant on a benefactor, either that or not compete or (as has happened) hope for a good bit of luck. Given the increasing parachutes and the real possibility of a "Premier League 2 by stealth" as mentioned in report then finding those benefactors will become difficult to impossible. It's all well and good saying we get 25K gates but for the club to be successful (financially) it will need more revenue than can be generated by fans putting hands in their pockets, be it ticket sales, merchandise or booze and pies. Clubs could try putting prices up but in our case I think the tipping point is pretty near and any more price increases (obvious or sneaky) will see a commensurate reduction in volume

At some point I would hope that the "football" will wake up and agree some sensible distribution of the funds coming into the game via TV and not just share it out between the privileged few. However I doubt it will ever happen and like you I see some dramatic changes for the worse in years to come.
 


Diego Napier

Well-known member
Mar 27, 2010
4,416
Birch, who delivered Portsmouth into fan ownership, said that many of the owners incurring the heaviest losses in the Championship were trying to sell but that the pool of potential buyers was diminishing. Local businessmen were becoming less interested due to pressure from fans that was heightened by social media, he added.

Hopefully TB will never be influenced by some of the bilge that a few numbskulls post on here
 


Rugrat

Well-known member
Mar 13, 2011
10,212
Seaford
Hopefully TB will never be influenced by some of the bilge that a few numbskulls post on here

Agree that was bollox ... but TB might have to resign himself to shoving his hand in his pocket to the tune of £xM or whatever it is, season in season out. I don't know how much he's got and whether or not his love for the club takes priority over sensible business decisions
 








seagullsovergrimsby

#cpfctinpotclub
Aug 21, 2005
43,690
Crap Town
Don't think so. But we're moving nearer to five fully professional leagues, rather than shrinking. Plus add in 2 or more Scottish leagues

It doesn't seem the case when living in a town which has a Skrill Conference Premier side. A number of clubs at this level are having trouble surviving on gates that don't cover all their outgoings and are considering going part time to survive. All the new signings at Grimsby Town are on one year deals and those already at the club have deals expiring at the end of the season.
 



Paying the bills

Latest Discussions

Paying the bills

Paying the bills

Paying the bills

Albion and Premier League latest from Sky Sports


Top
Link Here