This is clearly a question that has been bothering the Financial Times as they started a three part series on the topic in their Business News section today. Much of the article covers relatively familiar ground, although the summary table of who owns what in the Barclays Premier League is very useful.
Greg Clarke, chairman of the Football League makes an interesting point when he compares owners in the 1980s before the Premier League with those today. There was just as much competition, ambition and desire for success then as there is now.
This is clearly a question that has been bothering the Financial Times as they started a three part series on the topic in their Business News section today. Much of the article covers relatively familiar ground, although the summary table of who owns what in the Barclays Premier League is very useful.
Greg Clarke, chairman of the Football League makes an interesting point when he compares owners in the 1980s before the Premier League with those today. There was just as much competition, ambition and desire for success then as there is now.
What is different is that ‘The club owners of thoese days were hard-bitten, self-made money men, They’d made their money, they had a real relationship to real money. The current owners are willing to pay more for success and take bigger risks for success. It seems now that chasing the dream has become a more high-risk activity than it used to be.’
The three case studies of clubs are interesting. Bolton has achieved its aim to stay in the Premier League for ten years, but the cost to a club that is not from a large town is considerable. They lost £35.4m last season and they are going to have offload players in the January transfer window which might affect their current high position in the table. Admittedly, their strategy, which they have pursued with some success, has always been to buy cheap and sell dear.
But they have never quite dealt with the spiralling costs of the Reebok stadium. They rely on loans provided by Eddie Davies who sold his world leading business in control systems for kettles for £300m in 2005. The interest on the loans is rolled forward.
Stockport County has a more hand-to-mouth existence in League 2. The top gate this year is 4,500, the club rents its ground and is still reliant on a playing squad inherited from administrators. It employs 90 people, 25 of them players. Revenues are £2m and 40 per cent of that is accounted for by the footballing budget. It accumulated debts of £6m in administration and was bought by a consortium for £375,000. One of its members, Mary Gibbons, had a business with her husband selling domestic appliances and they branched out into fitted kitchens and bathrooms.
MK Dons has always been a controversial club but it is building up its own base of support among local youngsters. Under 16s make up a third of the season ticket holders. By the time the stadium is finished it will have cost £70m. The club already has debts of £20m. Pete Winkelman claims that football has created 3,000 jobs in Milton Keynes and brought in up to £200m in inward investment. It has not explained how these figures were arrived at and I am surprised that the Pink ‘Un treated them so uncritically. Winkleman admits that the club could do with success on the pitch and ‘Too often we run our player budgets a little too high.’