Any relegation is a financial challenge for a club, but dropping out of the Football League all together can be particularly alarming. Lincoln City FC are expected to post a £480,000 loss following their relegation.
Any relegation is a financial challenge for a club, but dropping out of the Football League all together can be particularly alarming. Lincoln City FC are expected to post a £480,000 loss following their relegation.
The football club has made a number of redundancies and three new directors have been brought on to the board leading to a new injection of cash. The Supporters’ Trust is the majority shareholder and has called for more stringent financial controls, although these might not help to remedy the lack of progress on the pitch.
It also suggests that the Supporters’ Trust formula does not necessarily work as a means of exerting financial control. On the one hand, clubs face the expectations of fans: if they are not met, they may stop coming to matches, particularly when times are hard, leading to a further fall in income. On the other hand, clubs face the demands of players and their agents.
There are also capital and maintenance costs associated with a ground of any but the most basic kind and utility bills have to be paid. In the past some clubs have used their tax liabilities as an interest free loan, but the Revenue’s patience with this behaviour has been exhausted.
In principle, Lincoln City should be quite successful as it is a ‘stand alone’ club with no rivals in the immediate vicinity. However, despite being a cathedral city, Lincoln and the surrounding area does face some economic challenges: it is not, in general, a high wage economy. The university may have done something to boost the local economy, but probably little for football attendances.