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 the ‘Community’ Category

Pompey – the turning point?

Posted by John Beech on November 20, 2012

I’ve not blogged recently on the Pompey basket case.  Not because there wasn’t much happening, but rather because there has been almost too much happening to stop and take a coherent view.  In fact, the last time I posted was back in March 2011, when I commented “Portsmouth City Football Club Ltd. is dead – long live Portsmouth Football Club (2010) Ltd.!” (1), and it reads today like some historical piece, and at least a tad ironic to boot – the tagline was “Onward and upward at Portsmouth?

The announcement that a conditional sale to the Pompey Supporters Trust has been agreed (2) brings at least some sort of turning point.

That the alternative bid from Balram Chainrai was turned down by the Administrator can only be good news – just how many times can the same person ‘save’ a club?  Trevor Birch’s choice may or may not have been influenced by the blogs of Micah Hall (3), but certainly the lack of response to the questions Micah posed to Tavistock Communications, Portpin’s PR company, spoke volumes.  Micah’s digging deserves an award, and shows how far a fan can go in the bigger picture of financial decision-making.

The fly in the ointment of the sale is, of course, the issue of the value that Chainrai is trying to place on Fratton Park.  Unless he finally decides to bow out gracefully, accepting that he made a very bad business call, the matter will go to court.  With independent valuations at a much lower level, the Trust stands a very good chance of getting the desired result.

There is also the matter of a potential further ten points deduction on coming out of Administration.  Here I am less optimistic.  I fear it will be yet more evidence that the deduction of points is an entirely dysfunctional sanction, but let’s not burn our bridges before we come to them.

All-in-all, there does finally seem to be a light at the end of the tunnel, and this hopefully will prove a turning point in the club’s miserable fortunes.

In the bigger picture, it may well prove to be a turning point in the road to fan ownership of clubs.  It does need to be seen though as one of many turning points, as I’m sure Brentford. Chester, Exeter Wrexham, and Wimbledon fans, and that’s not a definitive list, would be quick to point out.  It’s significance will depend on how well the hybrid model involving High Net Worth Individuals will work in practice.  If it does work, it will doubtless encourage the Supporters Trusts at bigger clubs such as Liverpool, Manchester United and Newcastle.

As a member of the Pompey Supporters Trust, I feel considerably more confident regarding the future than I have for a very long time.  I’ve even put a bottle of bubbly in the fridge, but I’ll not actually open it though until Fratton Park is in the fans’ hands.  The only certainty is the debt of gratitude Pompey fans owe to the PST Board.  Let’s show our gratitude by uniting behind them.

Posted in Community, Fans, Insolvency, Ownership, Points deduction, Sanctions, Stadium, Trusts | Tagged: , , , , , , , | 3 Comments »

Why I shall be especially grumpy this Saturday afternoon

Posted by John Beech on April 3, 2012

Football clubs ‘in poor financial health’” a headline on the BBC News website has just screamed (1).  Apparently “many clubs are continuing to spend too much, principally on players’ wages, as they always have done”.  What?  Surely not?  Well, OK, the said headline was in the Business section of the BBC website rather than their Sports section.

Begbies Traynor, who over the years have been Administrators of Chester City, Kingstonian, Lincoln City, Huddersfield Town, Northwich Victoria, Wrexham, Farnborough Town, Crawley Town, Scarborough, Bournemouth, Halifax Town, Southampton, and now Port Vale, have just completed a survey looking at the finances of Football League clubs.

Beneath the trite headline, there was some detail of interest.

Of 68 teams surveyed in those divisions, 13 have signs of distress such as serious court actions against them, including winding-up petitions, late filing of accounts and “serious” negative balances on their balance sheets.

That 19% compares to just 1% in the wider economy, the firm said.

In particular “the financially distressed clubs include three in the Championship, six in League One and four in League Two.”  Obviously the survey had been completed under conditions of confidentiality, so we can only speculate on which these thirteen clubs might be that are under short-term financial pressure, a temptation which I will resist, at least publically.

There are also the clubs which, to me, have potentially longer-term pressures because they operate on business models which may not be sustainable.  Two which have caught my eye with their recent publication of financial results are one likely to be relegated to the Championship, Wigan, and one about to be promoted out of the Football League, Southampton.

At Wigan (2), turnover was reported as up 16% on the previous year, although this, it was conceded, was “mainly due to the increased Premier League broadcasting rights contract”.   Worryingly though, net losses had risen from £4m to £7.2m.

Wigan fans might take some comfort from the fact that:

Net debt including bank borrowings and loans from David Whelan and his family remained virtually unchanged at £72.2m compared with £72.6m in the previous year Since the year end £48m of debt was converted to equity which significantly reduces the Club’s long term liabilities.

Chief Executive Jonathan Jackson commented:

This position would not have been possible without the continued financial support of Chairman, David Whelan. The post year end conversion of debt to equity has significantly strengthened the Club’s financial position and has, to a very significant extent, written off the debt owed to Mr Whelan.  The club cannot continue to make losses every year and we are continuing to shape all aspects of the Club to ensure the long term future remains positive both on and off the pitch.

Perhaps just a hint there that Mr Whelan’s pockets are not bottomless.  It was he who has called for control on players’ wages (3).  It was Wigan that managed to hit a wages/revenues ratio of an utterly unsustainable 208.3% in 2004/05 (posting passim).

Meanwhile over at Southampton another ‘debt for equity’ conversion was reported last Thursday (4).  The estate of former owner Markus Liebherr had ‘invested’ £33m over two seasons but had now converted these loans into shares.  (My reason for putting single quotes around ‘invested’ is that I do not see loans as investments.  If I had pushed my credit cards to their spending limits, would I talk in terms of MasterCard and Visa investing heavily in me?).

This conversion certainly takes the financial pressure off a club which last season made a net loss of £11m in gaining promotion from League 1.

The Liebherr family seem to be in that rare group of benefactors which includes Steve Gibson at Middlesbrough – those prepared to dig into their pockets deep and for the long term.  At Middlesbrough the club is “now free from debt owed to external providers” (5).

Looking along the South Coast from the perspective of a long-suffering Pompey fan (but who is number 1 a football fan rather than a club fan), a club in deep, deep trouble not least because it is still paying some players Premier League wages as it faces the drop, my eye caught on the wages/revenues ratio at Southampton, a very high 93%.

This counter-evidence in the discourse over the financial strengths and weakness of clubs is hardly typical.  While few clubs, correction, no English clubs, are as financially distressed as Portsmouth, the Begbies Traynor report paints a more typical picture.

As Portsmouth head for Southampton this Saturday, to be ‘entertained’ as the media like to phrase it, I’ll not be building my hopes up for a surprise Pompey victory.  The earlier derby this season may have been a draw, but Portsmouth now have a depleted squad, forced upon them by their financial circumstances (and as one might well argue, not before time).  No, I’ll be quietly fuming on the absurdity that the outcome on the pitch will have been determined ultimately by the lottery of how rich and how committed your club’s benefactor has been.  It may be a football match, but it certainly is being played in a context of competitive balance.  One club has been the subject of heavy financial doping, and is paying the price, and one is the subject of financial doping, but has so far kept the ‘habit’ under control.  One is a savage indictment of the failings of the benefactor model, and the other is fortunate enough to be able to say ‘OK so far’.

If any good at all is to come out of the ‘basket case’ circumstances Portsmouth finds itself in, it will be through a new and more sustainable financial model, which is why I fully support the community share offer from the Pompey Supporters Trust.  Post-commercial era football has totally lost it way.  Clubs have become the playthings of sugar daddies, and have, as in the cases of Portsmouth and Southampton, sugar daddies with no local connection.  Ownership has become a lottery, and fans have been betrayed as a consequence.  Football governance looks as it will receive only light-touch reform, but that is insufficient to set it back on a road where the results of games are determined in a context of competitive balance.  Financial Fair Play, whatever the extent to which it will actually prove successful, is a no brainer.  And fan ownership is the only way to ensure clubs are a part of the community whose name they are happy, and proud, to identify themselves by.

This posting is, for the moment, open to comments, but please bear in mind that this is not a fans’ forum – it is a personal blog, which is happy to encourage serious debate.  Trolls will have their comments deleted, as will those who favour the so-called banter of ‘scummers’ and ‘skates’.

Posted in Benefactors, Community, Debts, Financial doping, Governance, Insolvency, Ownership, Wages | Tagged: , , , , , , , | 5 Comments »

The Magic of Football – still there in the Cups?

Posted by John Beech on January 27, 2012

It’s increasingly difficult to see any magic in the beautiful game other than black magic, especially when you look at it from a financial perspective.  You only need to think of the narrow escapes at Plymouth and Wrexham recently, and both Portsmouth and Darlington are standing on the edge of the precipice.

The Cups may be a different matter however.  Recently Louise Taylor suggested that the FA Cup Third Round had failed to cast any magic on fans (1).  Below I’ve taken her data and, in italics, added some more.  It struck me that whatever magic there might be would be associated with the possibility of a giant-killing, or, as the BBC have started to call it, a ‘cupset’.  Did the possibility of a cupset bring out the fans, especially in the case where the ‘minnow’ was playing at home.

Home Club

Tier

Away Club

Tier

Away – Home Tier

FA Cup attendance

Average league attendance

Difference

MK Dons

3

QPR

1

-2

19,506

8,217

11,289

Swindon Town

4

Wigan

1

-3

13,238

7,887

5,351

Bristol Rovers

4

Aston Villa

1

-3

10,883

6,122

4,761

Gillingham

4

Stoke

1

-3

9,872

5,482

4,390

Macclesfield Town

4

Bolton

1

-3

5,757

2,222

3,535

Fleetwood Town

5

Blackpool

2

-3

5,092

1,781

3,311

Dagenham & Redbridge

4

Millwall

2

-2

3,396

2,161

1,235

Crawley Town

4

Bristol City

2

-2

3,779

3,181

598

Brighton and Hove Albion

2

Wrexham

5

3

18,573

18,595

-22

Chelsea

1

Portsmouth

2

1

41,529

41,632

-103

Manchester City

1

Manchester United

1

0

46,808

47,013

-205

Doncaster Rovers

2

Notts County

3

1

9,535

9,750

-215

Peterborough United

2

Sunderland

1

-1

8,954

9,233

-279

Liverpool

1

Oldham

3

2

44,556

44,857

-301

Tottenham Hotspur

1

Cheltenham

4

3

35,672

36,071

-399

Sheffield Wednesday

3

West Ham

2

-1

17,916

20,041

-2,125

Barnsley

2

Swansea

1

-1

7,380

10,719

-3,339

Norwich City

1

Burnley

2

1

22,898

26,516

-3,618

Nottingham Forest

2

Leicester

2

0

18,477

22,224

-3,747

Watford

2

Bradford

4

2

8,935

12,731

-3,796

Birmingham City

2

Wolverhampton

1

-1

14,594

18,682

-4,088

Fulham

1

Charlton

3

2

20,317

25,315

-4,998

Middlesbrough

2

Shrewsbury

4

2

12,631

18,164

-5,533

Coventry City

2

Southampton

2

0

9,000

14,813

-5,813

Everton

1

Tamworth

5

4

27,564

33,407

-5,843

Reading

2

Stevenage

3

1

11,295

18,554

-7,259

Sheffield United

3

Salisbury

6

3

10,488

18,559

-8,071

Hull City

2

Ipswich

2

0

10,246

18,922

-8,676

West Bromwich Albion

1

Cardiff

2

1

12,454

24,794

-12,340

Derby County

2

Crystal Palace

2

0

10,113

26,133

-16,020

Newcastle United

1

Blackburn

1

0

30,876

48,866,

-17,990

Totals

2.29

2.32

1

522,334

602,644

-80,310

I have added the away teams, the tiers in which each team plays, and the difference between the tiers at each game.  The list has been sorted into an order from the greatest increase to the greatest drop in the number attending.

The results are not entirely surprising.  Where the home team is two or more divisions below the away team, the fans have turned out in extra numbers.  At games like Everton v. Tamworth and Sheffield United v. Salisbury, the home fans staying away outnumber any boost in the ‘minnow’s’ away following.  The two biggest differences are at matches between clubs in the same division.  Overall there is a fairly clear picture of the FA Cup lacking magic except when a home team might just cause a cupset.

Below is a graphic representation with a rather unscientific trendline.

It’s unscientific in that there are many variables at work here, including, for example, the distance away fans have to travel, and, in any case we are dealing with fairly small numbers of games.

One difficulty is that a scientific look at this phenomenon would require details of ticket allocations for away fans (and implicitly therefore home fans, given that stadium capacity is known) and the percentage of these which were sold.  Does anyone know a single source on the internet which gives these?  This would be an interesting topic for research as the outcomes would provide a basis for a scientific allocation of tickets for away fans.

Posted in Community, Fans | Tagged: , | Leave a Comment »

Unsung heroes

Posted by John Beech on October 14, 2011

The news that Plymouth Argyle’s players and administrative staff are still failing to get their full pay (1) is not, of course, really news at all.  This situation has been going on for roughly a year.  It’s a message of despair that has become as familiar as Peter Ridsdale cooing that he expects a deal to be finalised very shortly.

There are still those who do not break out in sympathy with the players at least – you know the sort of stuff: “Overpaid prima donnas.  Serves then right.  No sympathy whatsoever.”  This is of course nonsense.  Plymouth Argyle is not a Premier League club, and the majority of players are on salaries that do not even begin to approach the telephone numbers that Premier League players command.  They do have the professional Footballers Association supporting them though.  Still, it’s hardly easy to adjust to dramatic changes in family income whatever your salary is.  I should know: I once had no choice but to make the first Mrs. Beech redundant from our shared workplace.

The administrative staff will undoubtedly be on generally lower salaries, and I have even more sympathy for them.  Apart from being worse off financially, they didn’t sign up to a profession where a transfer to somewhere else in the country was going to be an industry norm.  I’m sure most of them are local folk, who have more than demonstrated their loyalty to a club which is not just their employer but a club that they care about.  They are the real unsung heroes.

In a different news story today, another super-loyal administrator (in the non-insolvency sense of the word) has left his club/employer after an amazing 38 years – now there’s loyalty.  This is the case of Portsmouth’s Club Secretary, Paul Weld (2) .  As the club website points out: “Paul has worked through nine changes of ownership, 19 different managers (22 if you include Frank Burrows, Alan Ball and Harry Redknapp, all of whom managed Pompey twice), encompassing two periods of administration, four relegations, four promotions, one FA Cup final triumph, one FA Cup final defeat and a season in Europe!”  No doubt it was the two periods of Administration that must have caused the greatest stress in the Weld household.  Why did he remain so loyal when there must have been more secure job opportunities open to him over the years?  Well, “A Pompey fan, Paul was an active member of the London Supporters’ Club before arriving at Fratton Park from the Football Association as assistant to the then secretary Jimmy Dickinson, before taking over as club secretary.”  So, someone to whom it was clearly more than ‘just a job’.  And here’s a hint, Paul – yours is an autobiography that I can’t wait to read.

I’m sure there are similar stories to be told at a myriad of clubs.  Let’s not forget these unsung heroes, especially in the troubling circumstances of the current Plymouth Argyle administrative staff.  A club is much more than just the team who turn on Saturdays.  Let’s hope that those directly involved in the takeover negotiations can bring a rapid close to the brinkmanship and haggling, and show a little humanity to their loyal staff and their families.

Posted in Community, Human Resource Management, Identity, Insolvency, Investors | Tagged: , , , , | Leave a Comment »

Warring at Walsall

Posted by John Beech on May 16, 2010

Rising up the pyramid when there are larger iconic clubs geographically close to you is always going to be difficult, because the size of potential fan base is constrained.  In the case of Walsall (League 1), within ten miles they have West Bromwich Albion (Premier League next season), Wolves (Premier League), Aston Villa (Premier League), and Birmingham City (Premier League).  That is not to suggest that Walsall is not capable of having a committed set of ultra-loyal fans; rather, it is to suggest that when ambition for the club is mentioned, it needs to be tempered with some realism.

The club was an early mover into a modern stadium, the Bescot opening in 1990.  It has a capacity of over 11,000, and conference facilities, allowing non-matchday revenue streams.  Its form in modern times has seen it fairly stably around its current level in the pyramid.  The size of the stadium has not really been a constraint, and of late it has not been well filled.

After a period of considerable turbulence, the club was taken over in 1988 by a consortium led by Maurice Miller, who appointed two directors, Ray Clift and Jeff Bonser.  Within ten years, Bonser was Chairman, a position he still holds, and owner of the stadium.  (For more on this turbulent period and the early years of this regime, a particularly useful source was a series called The Long Road to Bescot published on the Walsall-Mad website, but now seemingly taken down.*)

Given the continuity of ownership and the relative stability of the club within the period over the last decade, one might expect to see at least the emergence of a financially healthy club.  The accounts for the period available to me (1999/00 to 2008/09) make interesting reading.

  • Apart for the three years from 2002/03 to 2004/05, a profit has been achieved.  Losses were so great in that period however, a loss of just over £1m in 2002/03 in particular, that the average has been a loss of £137,000 a year.
  • Turnover grew to a peak of almost £8m in 2001/02, with a ten-year average of just under £6m – which is almost exactly the figure for 2008/09.
  • The wages/turnover ratio peaked at almost 73% in 2002/03, but in the past few years has been held at below 50%, a level which is unusually low for an English football club.  It is this figure that no doubt drives the complaints from fans of a lack of ambition.
  • Long-term liabilities leapt in 2003/04 by £1m to £1.4m.  By 2008/09 they had grown to £2.2m.
  • Directors’ remuneration has grown, for 2008/09 being £134,000.
  • There is nothing obvious in the version of the accounts I have seen to substantiate claims that the club is paying Jeff Bonser over £1,000 a day as rental for the stadium.  That said, there is no alternative figure explicitly stated either.

The overall picture is much what one might expect at a club owned by a ‘benefactor’ who is trying to run the club as a business.

The one football source of revenue over which a board does have a major control is matchday receipts.  Average gates at Bescot Park grew at the start of the decade, reaching a peak of just under 8,000 in 2003/04, a season in which the club was relegated from the Championship.  In the season just finished they had fallen 11.9% on the previous season to just over 4,000, putting only Hartlepool with a lower average in League 1, which overall averaged over 9,000 (although it should be remembered that the average is pulled up by the presence of Leeds United, Norwich City, Southampton and Charlton Athletic).

Whether you see a football club as a business, and fans are your ‘customers’, or you see it as a sports organisation which is a focal point of the local community, and your fans are, well, fans, it would not make sense to alienate them and drive away the one source of revenue which have some control over.  Here too there has been a stability in Bonser’s approach.  Consider this quote from him: “I have no intention to justify to anyone how I invest personal money. I have always viewed any personal investment I have made into commercial enterprises as the only way of securing the long-term future of league football for Walsall.”  This is from a statement he made in March 1998, reported in the Sports Argus as he threatened to sell the club.

The same report included the following:

Ken Morrall, chairman of the Supporters Club, who once spent a year on the Walsall FC board as the fans’ representative, hopes any new owner will talk to them.

He said: “Problems started when we asked the football club in 1995 if we could have a little breathing space from paying our £1,000 a month donations while we sorted out our finances.

“We just needed a couple of months, but the next thing we had been served with a writ claiming we had contravened the licence by letting in people who were not members.”

The supporters club claim that over the years they have handed over about £750,000 to help the football club stay in business.

Twelve years on, are relations between board and fans any better?  In a word, no.

Protest is not tolerated at Walsall under Bonser and Chief Executive Roy Whalley.  Banners recently raised against Bonser and manager Chris Hutchings provoked bans (1).  Predictably enough there were further protests at the next home game (2), resulting in more bans.  According to Whalley, the protestors would drive attendances down (3), an interesting example of cognitive dissonance.

At the final home game there was a protest in the form of a sit-in (4).  One fan unfurled a banner, and was ejected by stewards who showed a remarkable failure to notice the irony that the banner read ‘Freedom of Speech’.

Tempers may cool over the summer, but the underlying issues will simply fester.  At the very least, Bonser and Whalley might like to think a little about the advantages of good public relations – they seem to have been off the morning that was covered.  Unless there is some movement in the opposing sides, the club is in danger of ripping itself apart.  For a club with a modern stadium with good facilities for non-football revenue streams, a good measure of stability in terms of where they play in the pyramid, a loyal core fan base and a very clear sense of local identity, this would be just plain ridiculous.  ‘Dialogue not warfare’ would be my choice of banner.  I’m not optimistic though.

[In the light of problems with comments encountered by my friends at Twohundredpercent, I have decided to allow comments, but moderation is likely to take longer than usual for comments from readers unknown to me.]

* Andrew Van-Hagen has kindly contacted me to say that this excellent ‘The Long Road to Bescot’ five-part series, written by ‘Sadlad’, is now available as part of a Memory Lane section on his Walsall Web-Fans Forum: (A), (B), (C), (D) and (E).  Strongly recommended.

Posted in Assets, Benefactors, Censorship, Community, Fans, Identity, Ownership, Public relations, Stadium | Tagged: , , , , , , , , | 4 Comments »

Player mobility and Sunday’s semi-final

Posted by John Beech on April 12, 2010

Deep joy in the Beech household, of course, after the much wished for but more than somewhat unexpected result for Pompey against Spurs.  It was a strange game for other reasons though.

There were those familiar ‘Pompey’ faces – Crouch, Defoe and Kranjcar – on the Spurs bench, and although Kaboul was cup-tied he was no doubt there.  A Spurs fan would equally have been watching for Boateng, Brown and Rocha, albeit on the Pompey bench, and might well have been looking for O’Hara, on loan to Pompey and thus contractually constrained from playing against Spurs, perhaps sitting in the stands with Kaboul.  Now, I don’t keep stats on the numbers of players cup-tied, let alone on players who pop up later on the opposition bench, but it did strike me that this was a tie with particularly strong reunion connotations.

This of course is no surprise given that professional players have moved between teams since the 1880s, when Preston North End regularly turned out a team of imported Scots, but it was nevertheless particularly striking that ’till I die’ does not apply to players in quite the same way it does to fans.  Which means that club loyalty is just that – loyalty to a club but not in the same way to its players.  But if the players move around so much, and in this case between two specific teams, it doesn’t help with the notion of local identity and a sense of community implicit in the team.  Perhaps I’m just being old-fashioned, but I find it difficult to ‘dump’ ex-players as readily as they themselves dump their previous clubs.  The problem I have is in seeing a club as something permanent and not related to its ever-changing squad of players.

Hey ho, I’ll get over it, but it has reinforced my view that the all-too-often often opposing diad of the sociocultural  ‘club’ and its business form the ‘company’ constituting a football club should more rationally be thought of as an uneasy triad of ‘club’, ‘company’ and ‘crew’, to use a naval term as Pompey prompted this rambling.  In terms of ‘identity’, it is a peculiarity that both ‘company’ and ‘crew’ regularly change (well, especially the former if you are a Pompey fan) while it is ‘club’ that goes on for ever, even if in a resurrectionist form.

Posted in Community, Fans, Identity, Transfers | Tagged: , , , | 3 Comments »

Think of a number…

Posted by John Beech on December 28, 2009

It doesn’t take an academic to spot that ‘one million pounds over a period of time’ is a completely meaningless amount.  The ravages of inflation mean that a pound today is worth far less than a pound was worth, say, twenty years ago. One thousand pounds a year as the starting salary of a graduate in 1970 would be the equivalent of almost £21,000 today, for example (1).

Yet ‘one million pounds over a period of time’ is precisely, or in fact very imprecisely, what David Handley, formerly the Financial Director of King’s Lynn, who certainly therefore should know better, has announced he will invest into a new club, that is, one which he would own.  His announcement (2), I’m afraid, is no more than, in the traditional sense of the phrase, clap trap – a cheap theatrical device to get easy applause.

He says he wants fans on any new board of directors, a claim familiar to Accrington Stanley fans, who gained no representation when Ilyas Khan actually took over.

Quite why he is prepared to invest such a large amount now (or over some unspecified future period) but was prepared to see the former club disappear because of a debt of £66,000 is unexplained.  He is, after all, the man who as recently as October assured fans he ‘will have The Walks outfit on a sound financial footing by the end of the season… I want the fans to judge me at the end of the season, but I’m determined to get the club in a good financial position and move forward from there‘ (2).  The answer must surely lie in the issue of who controls the club, both the previous manifestation and any future one.

If he was prepared to stand by and let the old club fold, why exactly should fans or King’s Lynn Borough Council (owners of the Walks stadium) have any faith in his plans for a future club?  If he wants what is best for a new club and for the community, would he be prepared to put funding into a Community Interest Company running a new club?  The answers to these questions are vital if he wishes to salvage any credibility.

Posted in Benefactors, Community, Ownership, Resurrection | Tagged: , , , | 7 Comments »

A time for alliance

Posted by John Beech on December 14, 2009

One of the great strengths of the internet is its underlying democracy (except, of course for readers in China and North Korea).  Anyone can start their own blog or Facebook group. But therein lies one of its weaknesses – there is no quality control and no underpinning rationale – any nutter can post their loony views to an unsuspecting and unwilling readership.  Ok, you can cut that sniggering out. Yes, you at the back, with the silly bobble hat and the monitor with the furry gonk.

The internet would be a curse to, say, the Recruitment Secretary of the People’s Liberation Front for Judea, as any Life of Brian fan will recognise. Apply this factionalism to football supporting and you may just recognise what is happening on the web with support for your club.

Consider three current examples:

  • Portsmouth
    The News today carries the following:
    The Pompey Virtual Alliance [see here for its composition - a domain name has been registered but is not yet active] have issued a vote of ‘no confidence’ in Pompey’s board.
    The supporters’ group, comprising of 13 web-based Blues fan sites and message boards, this evening took the unprecedented step.
    Their strongly-worded reaction comes in the wake of increased supporter anger towards the way the club’s finances are being run
    .” (1)
    If the thirteen groups had issued individual statements at various individual times, they would never have had the impact that coverage in the local newspaper brings.
  • Chester
    As their club continues to face very serious problems, fans have set aside traditional factionalism and formed a single body to voice their concerns – City Fans United. Their strapline is One voice… One passion. What they are achieving is One passion… One voice, and a much more powerful voice than when the various groups spoke with multiple voices.
  • King’s Lynn
    On Facebook there is now a plethora of groups, many of them recently formed, and I’m not going to give them the oxygen of publicity. If ever there was a time in the history of the club for one passion to produce just one voice, now is it.  And that one voice has to be The Blue and Gold Supporters Trust (or 3 and confusingly 4 on Facebook)
    Linnets unite!  You have everything to gain.

Posted in Community, Trusts | Tagged: , | Leave a Comment »

Alternative models

Posted by John Beech on December 5, 2009

Notwithstanding the emergence of Supporters Trusts, there has been relatively little experimentation with alternative forms of business structure in English football clubs.

One notable exception has been Ebbsfleet United, which allows democratic paricipation by its members through the use of the internet – see the club website and myfootballclub.co.uk. Both websites have been silent so far on some significant changes in the way the club is run, and I am dependent on the Gravesend Messenger for the latest news.

The ‘world’s first and only web-community owned club’ kicked off in February 2008 (1) with 28,000 members who had signed up by paying £35. Things have not always run smoothly since then, for reasons both to do with the organisational structure and unrelated reasons. Members participated in the decision to sell a player (2) in August that year, but by December manager Liam Daish was expressing concern that his budget might be cut if not enough members renewed (3).

In February this year, with memberships due for renewal, there were reports that numbers were significantly down (4), with numbers falling some 2,000 short of the targeted 12,000 (5). Cost-cutting measures were announced in March (6), but plans for a new stadium were published in April (7).  This almost coincided with the resignation of Chief Executive David Davis (8), Chairman John Moules stepping into the role, before himself stepping down in July (9).

The club has also faced problems with its training ground (10).

The latest tweaking of the model has seen two significant changes.  Firstly the club has bought out the MyFC Operating Agreement from founder Will Brooks for £15,000 (previously Brooks had taken 20% of subscriptions to run the website), and secondly the subscription has been raised from £35 to £100.  The latter move is presumably on the assumption that the hardcore of supporters are relatively price insensitive, a risk unless some market research has been undertaken, although the fact that the decision “overwhelmingly backed by members in online votes last week” is encouraging for the club’s survival.

No doubt there will further tweaks as the club further explores this unique model, and it is certainly a model I watch with interest.

Another interesting development this week, albeit north of the Border, was the decision of Stenhousmuir to become a Community Interest Company (CIC) (11).  According the official government website “Community Interest Companies are limited companies, with special additional features, created for the use of people who want to conduct a business or other activity for community benefit, and not purely for private advantage. This is achieved by a “community interest test” and “asset lock”, which ensure that the CIC is established for community purposes and the assets and profits are dedicated to these purposes. Registration of a company as a CIC has to be approved by the Regulator who also has a continuing monitoring and enforcement role” (12).  A CIC is in many ways similar to a conventional company – it can be a public company limited by shares, a private company limited by shares or a company limited by guarantee, and will have the same benefits and obligations as other companies of its type, including registration at Companies House – but it must, among other obligations, only use its assets and profits for the community specified (or pass them to another body with similar features), and keep the community in touch with its activities. Sounds good to me – asset stripping of a stadium blocked, and mandatory community orientation; isn’t that just how a football club should be constrained?

As far as I can make out (the CIC website search function doesn’t seem to be working) the only English club to adopt this model so far is Eastbourne Borough (12) just over a year ago. Among the developments at this club is the offer of a directorship for £5,000, and, as the club points out with massive understatement, “You don’t get offers like this at the likes of Chelsea or Manchester United” (13).  Mind you, there’s an idea for Portsmouth.  ;-)

I’d be interested to hear comments from any Eastbourne fans on how the CIC model has worked for the club, and from any Stenhousemuir fans on what prompted this change.

Posted in Community, Governance, Organisational culture, Ownership | Tagged: , , , | 3 Comments »

Three cheers for Manchester United!

Posted by John Beech on September 22, 2009

No, seriously!

With just the slightest touch of curmudgeon to begin though.  I’ve blogged before on how football’s culture of secrecy results in good news stories being hidden away, and this is another fine example.

Not well covered in the media, with the honourable exceptions of a report by Brian Viner in The Independent (1) and reports on Goals.com, was the Homeless World Cup, which has its own website.  Modelled on street football rather than the conventional form of the game, this year it was held in Italy, with match venues including the San Siro in Milan.

England’s team was organised by The Big Issue in the North, and Manchester United, as in many previous years, provided training facilities and support through their Football in the Community programme (2).  Not that they shout about – you have to descend several levels on their website (knowing where to go) before you find a rather short webpage (3, for some basic information).

Why the coyness, Man U?  You should be shouting about it!

Posted in Community, Premier League | Tagged: , | Leave a Comment »

One more, apparently two

Posted by John Beech on June 24, 2009

[See my earlier posting Just how many more? (1]

Yesterday Newcastle Blue Star announced that they were withdrawing from competitive football (2). This might seem strange as the cub has just won the UniBond Division One North play-offs and was therefore about to join the Premier Division.

Off the pitch there has been no parallel fairy tale – ‘farce’ would be a better word to describe recent events, or, from the club’s perspective, ‘tragedy’.

In early May it was announced that the club’s Chairman and benefactor was withdrawing his financial support (3). Two days later it was revealed that the Football Stadia Improvement Fund (FSIF) was demanding the repayment of £65,000. How this came about is a classic of the strange world of non-League football.

The club’s version of events has been put by Secretary Jim Anderson, who has been involved with the club for 21 years:

“During the last 10 years, we obtained substantial sums from the FSIF to improve the Wheatsheaf ground.

“In April 2006, we were approached by the Football Association and asked to join the newly-formed UniBond League Division One North.

“We said at the time that we would have to relocate to Kingston Park since we knew that, despite the improvements which had been carried out, the Wheatsheaf ground would not meet the criteria.

“The FA and UBL were desperate for a North East side to move up the pyramid.

“And there was even a promise of support towards travelling costs when it became known that Blue Star would be the only North East club making the move.

“In the last three years, we have continually explained why we should not repay the £65,000 which had been spent on the Wheatsheaf ground.

“It’s not as if the money is lying in the bank.

“The only way the club can continue is for the FA to sanction a ‘transfer of membership’ to Kingston Park but it is refusing to do so while there is an outstanding claim.” (4)

The club has not abandoned the Wheatsheaf, but their presence is restricted to the “Sunday team and over-40 side in addition to 150 kids who regularly are at the ground”.

At Kingston Park, capacity 10,200, gates have averaged 153 (5).

The terms under which the FSIF make grants state that “We base grants on the league you were in at the time you sent your application, regardless of whether you are relegated or promoted after that, unless your promotion or relegation has been confirmed by the league at the time you sent your application to us“. (6)

All in all, it had become an unholy mess. A pragmatic solution was called for, but the FA and the FSIF stuck to their guns, effectively pulling the plug on the club (7).

Meanwhile down in the Midlands, news of Racing Club Warwick remains scant. Their website has been suspended (8) and UKDATA reports the following events with respect to the club:
19/06/2009: Dissolution or striking-off document filed – Application for striking-off.
23/06/2009: 652A – Application for striking off.
23/06/2009: Dissolution or striking-off document filed.
It is a club particularly committed to community involvement, but it has struggled to find a backer and faced debts reported to be £68,000 owed to HMRC and other creditors (9). So far even the local news media have not picked up these latest events.

Posted in Community, Debts, Governance, Insolvency, Stadium | Tagged: , , , , | 2 Comments »

Football’s postcode lottery

Posted by John Beech on April 9, 2009

Port Vale have had their share of problems of late. They were facing ‘huge losses’ (1) and this a club that had gone into Administration in 2002. Two recent pieces of news will have brought some relief though – first, the club’s shirt sponsor, Harlequin Property, are reported as “set to invest £500,000 in Valiants” (2), and, secondly, Stoke-on-Trent City Council has agreed to a two-year deferment of £227k in capital payments on a loan (3), a repayment holiday which will be most welcome to a club which last November reported annual losses of £384k. Not that the council displays undue favoritism to Port Vale. In 1997 it had part-financed the move of Stoke City to the then new Britannia Stadium to the tune of £3.1m (4).

Such willingness to support local clubs is far from typical, but in my post of April 3 I noted examples of possible stadium purchase (Southampton), possible £100k loan (Cheltenham Town) and £50k sponsorship deal (Bury).

Over the border in God’s ain country at least one council takes a less benign view. North Lanarkshire Council, based in Cumbernauld, one of Scotland’s New Towns built in the 1950’s to help with housing and rehousing the Glasgow population overspill, owns the Broadwood Stadium Company Ltd, through which it operates the multi-purpose stadium of that name. Its first tenants when it opened in 1994 were Clyde FC, who now share the stadium with Rangers’ reserves. Clyde are now being threatened with eviction by the council for rent arrears, said to be of the order of £150k by the club, but £270k by the council. If there is no resolution by the end of this month, Clyde may cease to exist. Either sum would presumably be small beer to Stoke-on-Trent City Council (population of 240,636 in the 2001 Census; the population of the Potteries Urban Area was 362,403), but apparently not to North Lanarkshire Council (population 324,700 in 2007).

Such an extreme range of attitudes to the local football club by their local council is simply perverse.

Posted in Community | Tagged: | 2 Comments »

Councils & Clubs – Southampton, Darlington, Cheltenham Town and Bury

Posted by John Beech on April 3, 2009

Historically the link between councils and football clubs has been the ownership of stadiums. Today in the Premier League only Hull City and Newcastle United retain this link, yet another indicator of the post-commercialised game. But are new links emerging?

As the precarious future of Southampton is picked over, the Daily Echo reports that the local council won’t rule out purchasing St Mary’s, where talks were under way with Take That, Rod Stewart and The Eagles about gigs (1). It’s hard to imagine they would want to take over the massive debt (£24m) without a massive stream of gigs… oh, and a viable football club.

Such speculation will fall on angry ears in Darlington, where George Reynold’s plans failed to come to fruition mainly because of the local council’s intransigence in granting planning permission for non-football events (2). At least, that’s Reynold’s analysis. Certainly his successor George Houghton faced similar problems. In both cases non-football revenues were an essential part of the business plan.

Another club struggling financially at the moment is Cheltenham Town. This season they have been forced to let a string of palyers go as they try to balance their books. The resignation of Simon Keswick, said to be worth £996m, as a director in January (3) won’t have helped matters. March saw the entire squad up for sale (4). Now the club have approached the local council for a loan of £100,000 to keep them afloat (5). The rationale the club puts forward is that the council subsidises the local theatre, so why not football? I think the answer is clear – the theatre is not operating in a fully-commercialised industry where companies are expected to be self-supporting. Perhaps I’m splitting hairs, but what next? Kensington & Chelsea Royal Borough Council joining Roman Abramovic on the list of Chelsea’s ‘soft’ debtors?

Giving the request an interesting twist is the fact that the club’s Chairman, Paul Baker, is a Lib Dem councillor, and exactly half of the 40 councillors are of this persuasion. Normally the decision would be made by the Cabinet of the Council, and here six of the seven are Lib Dems. As a result the decision is now to be made by the Council’s Chief Executive (6). No pressure there then.

The request for financial help from the local council has an interesting precedent. In 2002, facing mortgage arrears of £1m on their stadium and already slipping inevitably into Administration, the club turned to their local council for help. The council tactfully declined to sub the club saying “We have to cater for many needs from what is not a limitless budget.” They of course also had local tax payers, and hence voters, to consider. Instead they came up with a sensible and pragmatic alternative – a sponsorship deal of £50,000(7) to promote the local Metro tram service .

Will Southampton and Cheltenham councils prove to be as sensible and pragmatic, or will they follow the Darlington council hard line?

Posted in Community, Insolvency | Tagged: , | 1 Comment »

 
Follow

Get every new post delivered to your Inbox.

Join 130 other followers

%d bloggers like this: