Football Management

Commentary on the management of over 160 English football clubs by Dr John Beech, winner of the FSF Writer of the Year Award 2009/10 Twitter: @JohnBeech Curator of Scoop.it! Football Finance

Archive for September, 2011

“Completely vindicated”? Well, not quite completely

Posted by John Beech on September 29, 2011

The press have been quick to quote Peter Ridsale as saying that he had been “completely vindicated” following the dropping of charges fraud brought against him by Cardiff Training Standards Department (see BBC and This is Plymouth for example).

In my book, in this case that fine arbiter of plain English, the Oxford Advanced Learner’s Dictionary, the primary definition of ‘vindicate’ is “clear of blame or suspicion“.

Undoubtedly he has been “completely vindicated” of ‘blame’ as the charges have been withdrawn, and he continues to be able to be a director of a football club.  He can continue to weave his own brand of magic, honed at Leeds United, Barnsley and Cardiff City.

Whether he has been cleared of ‘suspicion’ is, in my opinion, not quite so clear-cut however.  Further down in the press reports the reason the charges were dropped is revealed.  A council spokesman is quoted thus: “On paper, there was a case to answer, however, the council has recently obtained further evidence from prosecution witnesses and taken the advice of a leading counsel.  After a thorough analysis of this new evidence, and due to the reluctance of those supporters who raised concerns to provide witness statements, the council considered that a conviction after trial was unlikely.  Consequently, the council has decided to discontinue the prosecution.”  In these circumstances it would seem likely that there will those who still harbour a suspicion, possibly including some at Cardiff Trading Standards Department, and so ‘complete vindication’ is an interesting use of the language.

To remove both ‘blame’ and ‘suspicion’ it can be argued that the case would have had to have gone to trial, and ‘not guilty verdicts’ returned for all three charges.  Ridsdale had previously said “I will be vigorously rebutting the charges” (1).  He must surely be ruing the fact that the charges were dropped, and he was denied his opportunity to have his cases heard and to be ‘completely vindicated’.

Posted in Ethics, Fit and Proper Person tests | Tagged: , | 3 Comments »

The devil’s work

Posted by John Beech on September 29, 2011

For someone who has no great love of the media, Sir Alex certainly knows how to get himself in the headlines.  His latest claim is that football has sold its soul to the TV ‘devil’ (1).  Attractive though his choice of metaphor is, with the vision it generates of a BSkyB ‘evil empire’, it just doesn’t really work when his other complaints he makes are vectored in.

He complains that the broadcasters have too much power, especially with regard to their influence on fixture lists.  But isn’t that inevitable when you sell your soul to the devil?  It’s exactly that power that the ‘devil’ broadcasters have bought.  And I don’t recall that the standard ‘devil buys soul’ contract allows for renegotiation of the terms.

He complains too that the broadcasters haven’t paid enough for the rights.  That may or may not be the case, and Sir Alex is not being unreasonable in making the suggestion as it is the Premier League who ‘sold their soul’ rather than Manchester United, Sir Alex’s club.

The Premier League though do not of course distribute broadcasting rights to clubs equally, and Manchester United does rather nicely thank you compared with the weaker clubs in the league (who, to maintain competitive balance, should if anything get more than Manchester United, rather than less).

On the whole, I’m not unsympathetic to some of the points he makes, but, in his case, methinks he doth protest too much

Posted in Broadcasting rights, Governance, Premier League | Tagged: , , | 5 Comments »

The changing face of Premier League shirt sponsorship

Posted by John Beech on September 15, 2011

The news the other week that Manchester United had secured a lucrative sponsorship deal with DHL for their training kit (1) rather caught my attention.  It wasn’t the unique (?) case of training kit being sponsored – I would expect this to be a one-off, with all new shirt sponsorship deals having a clause requiring exclusivity over all shirts.  It was the fact that a global courier service was the sponsor.  Their business is truly global, they have previously sponsored sport (2), and a Premier League club would give them global ‘reach’.  No doubt we will see UPS signing up next season – they too are already into sports sponsorship (3).  They actually offer a handy application form on their website – commercial managers of football clubs get typing!

The news that QPR have finally signed up not one but two shirt sponsors (home/away kits) (4) allowed me to complete this season’s entries into my Premier League shirt sponsorship database.  More on this in a second, but I must warn you that the official QPR website has followed the Times in charging for content other tasters – a distinctly retrograde step and hardly fan-friendly.  Do these clubs need ‘naming and shaming’?

Two initial views of the data show some interesting trends.  First, some data on the country of the sponsor.  The graph is a tad grainy as presented I fear, but clicking on any of the images will open it up to a rather more legible size (I kept them small on the posting itself so as not to slow downloading).

Very broadly there seem to be three periods  apparent: from the start of the Premier League a steady-state period to roughly to the end of 1997/98, with sponsors falling roughly equally into the UK and foreign categories; a period from then until 2006/07, when foreign sponsors started to turn away, before starting to return; and the most recent period, showing a return to a roughly equal split.  I would have to admit that I can’t see a simple obvious reason for this trough of foreign sponsorship in the middle period.  Do any readers have any thoughts on this?

While the Premier League began with almost half the clubs sponsored by locally-based companies, there has been a slow but steady decay.  This I would simply attribute to the rising cost of shirt sponsorship, with foreign-based multinationals better placed to pay higher fees than the likes of, for example, the splendidly named Reg Vardy Motors, sponsors of Sunderland roughly a decade ago, and now part of Evans Halshaw.

It shouldn’t be assumed that ‘local’ necessarily means a UK company.  For example, Peugeot sponsored Coventry City for their first five years in the Premier League – the Peugeot 206 was at that time built at their Coventry site.

Secondly, data on the sponsor’s sector.

The graph shows the four most frequently occurring sectors over the two decades.  Financial services are just the largest grouping at 13.5%, closely followed by breweries at 12.8%, although, if the breweries are combined with the occasional sponsorship by spirits and cider manufacturers, alcohol manufacturers, with a combined total of 13.8%, slip into top spot.

It’s clear that financial services have grown steadily as sponsors over two decades, but gambling, the Johnny Come-Latelys of PL shirt sponsorship, is very much in the ascendancy.  Together the two sectors now sponsor 13 of the 20 clubs.  The early days of the Premier League saw a much greater diversification among shirt sponsors.

Finally a look at the Top 4 v. the rest of the Premier League clubs.  One would expect the clubs which have pretensions of being global brands to attract global sponsors, and this is indeed the case.

By playing more televised matches, especially when qualifying for the Champions league, the Big 4 have consistently attracted more foreign sponsors than the other clubs, generally two to three times more.  By being able to play a global market in attracting sponsors, they have been able to push their sponsorship charges up, and so increase their financial muscle.  There is thus a double effect of reinforcing their dominant position, by greater TV revenues and by greater sponsorship revenues.  Whatever happened to competitive balance?

Posted in Marketing, Revenues, Sponsorship | Tagged: , , | 7 Comments »

Some rather late and ineffective justice for Luton fans

Posted by John Beech on September 11, 2011

There was some small crumb of comfort for Luton fans in the news that four of the directors of the previous owners of the club had been banned from being company directors (1) (and hence now fail the Fit and Proper Person Test).  Former chairman Bill Tomlins was disqualified for six years; Derek Robert Peter, the former CEO and a chartered accountant was disqualified for seven years, and Richard Sidney Bagehot and John Mitchell were each disqualified for three years.

The official statement from the Insolvency Service (2) who investigated Luton Town, or more exactly the old company, Luton Town Football Club Limited (“LTFC”) – which is not in any way connected with present owners Luton 2020 – makes clear the scale of what had been going on under the club’s previous owners:

The investigation by The Insolvency Service found that the directors of LTFC had breached Football Association (FA) and FIFA rules and caused LFTC to trade at the risk and detriment of HM Revenue and Customs (“HMRC”), being in arrears with PAYE and NIC within a few months of commencing to trade and recently not declaring or paying its VAT liability.

Between July 2004 and February 2007 LTFC acted in breach of FA and FIFA rules and regulations on payments to football agents. The FA enquiry found that the company had dealt with unlicensed football agents and made payments totalling £157,000 through its holding company Jayten Stadium Limited (‘JSL’) using funds provided by LTFC which should have been paid by LTFC itself and routed through the FA.

During the same period of July 2004 and February 2007 the directors individually either caused or allowed the company to trade at the risk of and ultimate detriment to HMRC which was owed £3,578,661. The Court heard there was a pattern of non-payment and chasing from HMRC.

Why I say “small” crumb of comfort is for two reasons.  First, the club has had to suffer as a football club for the misdemeanours of these previous owners (see previous posting where I wrote of Luton’s ‘unfair disadvantage’) in terms of points deductions and the resultant relegation to the Conference.  Seeing four people just banned from being company directors hardly results in an overall balance of justice being seen to be done.

Secondly, the perceived lack of balance in justice is exacerbated by the fact that these goings-on came to light as a result of whistle blowing from within the club, which should have in part mitigated the punishments handed out to the club.

The success in bringing about these bans must give HMRC a good feeling for their ongoing fights with football clubs.  These currently include the major fight North of the border against Rangers (a blog worth a look at on this is Rangers Tax Case as is The Scotsman), their attempt to have the Football Creditors Rule thrown out by challenging the leagues in court rather than taking action against individual clubs, and the ongoing cases against Harry Redknapp, Milan Mandric and Peter Storrie.  Some interesting reading coming up there’s no doubt, and the various court rulings may have significant implications for all clubs.

Posted in Debts, HMRC, Insolvency, Points deduction | Tagged: , , , | 5 Comments »

Banning Orders

Posted by John Beech on September 10, 2011

The banning of a fan, whether by a club or by a court, is a contentious issue.  SjMaskell has an interesting and thought-provoking posting up on just how easy it could be to find yourself banned under Section 14 (B) of the Football (Disorder) Act, without ever being charged, let alone convicted.  I wonder how often that is used in comparison to bannings under Section 14 (A) – those which follow from a conviction.  I wonder too how many fans realise they can be banned without ever having been convicted of an offence.

Banning is not a topic that I have frequently blogged on.  In fact the only previous occasion was when I compared the Crawley Town lifetime ban, imposed on an idiot who they claimed wasn’t one of their fans in spite of the fact that he appeared as one of their own on their official website, with the Stevenage Town fan who received a six-year ban for assaulting one of his team’s players on the pitch.  I thought at the time that, notwithstanding the fact that nothing could be said in way of mitigation of the ‘Crawley Town’ fan’s inept behaviour, a life-time ban seemed inappropriately harsh for inept but offensive behaviour, especially when compared to the act of punching a player on the pitch, and I don’t feel any differently now.

Does anyone have any data sets on banning orders?  This topic seems worthy of further research and analysis.

In the meantime, steady as you go when engaging in banter with fans you don’t know – you never whether they have ‘history’.  Should you find yourself being unfairly treated, the people to contact are the Football Supporters’ Federation, who can offer a range of advice and active support.

Posted in Fans | Tagged: | 2 Comments »

The ins and outs of the transfer window

Posted by John Beech on September 3, 2011

So, the transfer window finally slammed shut, to use the mandatory cliché, amid the predictable hype.  In one respect this was hardly surprising – of the 289 August deals reported by the BBC (1), no fewer than 93, or 32%, had taken place on the final day.  In total 141 (49%) had taken place in the final week.  One was almost left wondering whether a whole month was needed.

A noticeable feature of the BBC data is that of the 289 deals, 69 involved players described as unattached, 110 were loans, and 10 were free transfers, leaving only 100 (35%) that were full-blown fee-paying transfers.  Given the main reason for having a transfer window – to prevent clubs buying in extra talent in a burst to achieve promotion or a Champions League place – the question must surely arise as to whether it is necessary to apply any transfer window at all to non-fee-paying transfers, now the clear majority.  After all, no club is going to loan another club a player willingly if it feels that will upset competitive balance and/or give the receiving club a somehow unfair advantage.

It’s difficult to analyse the spending by individual clubs – the BBC data records the figure for a mere 17 deals:

Samir Nasri Arsenal – Man City £25m
Juan Mata Valencia – Chelsea £23.5m
Bryan Ruiz Twente – Fulham £10.6m
Mikel Arteta Everton – Arsenal £10m
Peter Crouch Tottenham – Stoke £10m
Andre Santos Fenerbahce – Arsenal £6.2m
Scott Parker West Ham – Tottenham £5m
Oriol Romeu Barcelona – Chelsea £4.35m
Jermaine Beckford Everton – Leicester £3m
Emmanuel Eboue Arsenal – Galatasaray £3m
Ishmael Miller West Brom – Nottingham Forest £1.2m
Leroy Lita Middlesbrough – Swansea £1.75m
Shaun Maloney Celtic – Wigan £1m
James McClean Derry City – Sunderland £350,000
Darnel Situ Lens – Swansea £250,000
Shaun MacDonald Swansea – Bournemouth £80,000
Chris Lines Bristol Rovers – Sheffield Wednesday £50,000

There seems to be a consensus that spending has peaked again following a couple of years decline.  Which is bad news in my book.  I would have hoped that Financial Fair Play and capped squad sizes would have reined in the crazy levels of spending.  It may be that they have outside the Big 5, but that in itself is dysfunctional – these are the five clubs most likely to qualify for Europe and therefore find themselves under scrutiny from UEFA.

It’s also clear from the limited data available that there is no sign of the vertical disparity in terms of spending power  up and down the football pyramid declining.  Again, I can only greet this with disappointment.  When will they ever learn?

Posted in Costs, Globetrotterisation, Premier League, Transfers, Uncategorized | Tagged: , , , | Leave a Comment »

 
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