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

Jack Frost and the threat to club finances

Posted by John Beech on December 9, 2010

Last Saturday’s football programme was considerably more than decimated (1, and then follow the ‘see also’ too), at least to a language purist.  Although the Premier League and Championship programmes were largely maintained, very little football was played lower in the pyramid.  The impact of this financially should not be underestimated.

Even though games will postponed rather than cancelled, clubs can expect a reduction in revenues as most games will be moved from a Saturday fixture to a mid-week fixture.   This leads to a lower level of attendance by non-season ticket holders and corporate hospitality users, and hence a reduction in revenues.

If the bad weather keeps up, we can expect to see more clubs revealing their financial weakness.

More critically for some clubs is the immediate financial hit on cashflow.  Clubs that are living day-to-day financially may well be depending on Saturday’s gate money to settle pressing debts, or at least to keep pressing creditors such as HMRC sweet.  Among the clubs I would rate currently as under financial pressure are Plymouth Argyle (1), Sheffield Wednesday (2), Welling United (3), and Windsor & Eton (4).  Their situations will hopefully resolve themselves, in varying degrees, with the finalisation of takeovers or the further injection of cash by current owners, but the longer this takes the more critical the postponement of games will be.  Any club in a CVA is likely to be on a tight budget too, and hence vulnerable to the volatility of cashflow.

I’ve seen few estimates of how long individual English clubs are likely to suffer (and it’s obviously a function of upcoming weather too), but I did not that Morton, up in Greater Glasgow, is concerned about the possibility of a two-month delay before resuming their published fixtures (5).

If the bad weather keeps up, expect more clubs to reveal their financial fragility.

UPDATE – 13 December

Histon can be added to the list of clubs with serious cashflow problems (A).

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6 Responses to “Jack Frost and the threat to club finances”

  1. This is very true – as a Plymouth Argyle fan, one of the cases we put forward in our defence against the Winding Up Order served against us by HMRC was that we had a forthcoming home match against our local rivals, which should see in excess of 10,000 attending (the last home game attracted less than 5,000.. and we have more than 6,000 season ticket holders, so that tells you all you need to know about the “quality” of football at Home Park these days!)

    If that game were to be postponed, then somewhere in the region of £100,000 of POTD (pay on the day) money that would have been budgeted for, simply wouldn’t arrive – for a club that is already robbing Peter to pay Paul, this could be catastrophic for us.

  2. So many clubs live hand to mouth by using gate receipts to pay wages. It really is a worry but it more highlightes the poor way in which clubs are run….clearly there is contingency in the budgets

  3. […] Jack Frost and the threat to club finances […]

  4. lee said

    As a canadian (were the american protectorate to the north, not really a sporting nation as we have only one professional sports league) who isnt afraid of snow or cold (it was -30C back home this week with wind chill, -42C), I have to ask: WHY THE HELL DO YOU NO PLAY IN THE SUMMER?
    This is so insane that there are few words for it.

    FIFA for years has been trying to get MLS to move to your schedule and it shows a shocking grasp of things like weather.
    I have yet to see how siberian towns will fare in the russian leagues will fare now they to move to a winter schedule.
    Unless they plan to built many covered stadiums, this makes zero sense.

    Ive played more than a few season ending tournaments in october and november to know that while you can play, the result is totally different.

    At the very least have a winter break.

    But ive seen enough EPL games in november and january to know that closing it down for 2-3 weeks still doesnt stop weather from being an important factor.
    Maybe, just maybe, the english lack of skills isnt a national thing but rather the fact that your kids play with frozen feet most ofthe time (i went to a nephews U11 practices)

    Im told by some that its a cultural thing,that cricket is a summer sport and winter is for football and rugby.
    This cant be the only reason football is a winter sport.
    (maybe have football at the winter games)

  5. […] Jack Frost and the threat to club finances […]

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