The 14 questions

[Toonpack 8688]

I prefer the term 'financial realists whose judgements aren't clouded by personal hatred' but whatever.

 

Yep.

 

 

Is it unrealistic to expect better than relegation/12th place for £280m of investment?

 

Or even for £70m if you take into account that £140m went to the previous owners and £70m to the banks on day 1.

 

No it's not. But expectation and actual achievement are often at irreconcilable (in a volatile environment - as football is). £X in, does not = Y league position.

 

Should we have gone down, no, but we did.

 

Not sure what your point is tbh.

 

I don't disagree with anything in your earlier post BTW

[manc-mag 1]

But when you're not, what do you do ??

 

The pursuit of success within the constraints of responsible financial practice should be a gradual process, not a large push for immediate success.

 

This would be achieved by retaining your best players and replacing your weaker ones with superior performers on a gradual basis. There is every chance that these players may cost more and be on higher wages, but the idea is for this to be offset by an increase in match attendance, merchandise sales, sponsorship money, prize money (higher league position, further in Cup competitions and ultimately qualification for European competition), and an increased value in the club along with its a superior perceived position in relation to other clubs.

 

This is obviously not the model that Ashley is operating under, regardless of what they say.

 

Any risk taken should be a manageable one.

 

 

Good luck selling that dream to your 'top players'/ambitious stars.

 

Nah, not the real world I'm afraid. Truly 'in demand' players will want a wage hike every few years and rapid progression, because as long as they're truly 'in demand' there'll be one of three or four clubs at the top prepared to offer them that. It's a nice thought, but it's ridiculous to suggest you're going to keep all your best players by showing them some cautiously incremental model. As Leazes says, the very top players want silverware now (ps and money), so you can't really have it both ways (even though he's suggesting you can by agreeing with you).

 

Also, the turnover point does now need to be addressed square on. Not simply 'increase turnover', but suggest how much realistically it can be increased by, and how much difference, realistically speaking (in the context of bankrolled opponents budgets) , that can mean to our player acquisition/retention. This debate really does need to be rooted in the real world now.

 

HF makes some good, moderate points in his last few posts. Lets keep it going in that direction.

[LeazesMag 0]

[Happy Face 29]

I prefer the term 'financial realists whose judgements aren't clouded by personal hatred' but whatever.

 

Yep.

 

 

Is it unrealistic to expect better than relegation/12th place for £280m of investment?

 

Or even for £70m if you take into account that £140m went to the previous owners and £70m to the banks on day 1.

 

No it's not. But expectation and actual achievement are often at irreconcilable (in a volatile environment - as football is). £X in, does not = Y league position.

 

Should we have gone down, no, but we did.

 

Not sure what your point is tbh.

 

I don't disagree with anything in your earlier post BTW

 

Just a response to you and Chez who are suggesting hatred of Ashley clouds the view of financial reality.

 

Think I was pretty clear that I understand the financial reality if he wants to stop spending money now.

 

What I hate is statements saying we'll "make sure that Newcastle United is self-financing, which in turn will allow us to invest in the squad, our youth development system and our facilities, without having to rely on additional financial support from the owner. There aren’t many clubs in England who can hope to achieve that."

 

There are many clubs where the owners don't put money in...they either have a lot of other debt or thy're not investing in the squad, youth and/or facilities.

 

They're selling a pipe dream.

[manc-mag 1]

 

I'm not disagreeing with Oz's proposals for the record, I'm disagreeing with his (and indeed your) suggestion that it's the magic solution staring all us dullards in the face.

 

If we adopt that model, we will still lose our top performers to the top clubs. They'll simply pay them more/offer them a more immediate opportunity at footballing progression. Daft to suggest otherwise.

 

I think I'm realistic in accepting this is the mentality of players with 'options'. Thus we will lose some. I still think Oz's suggestion is correct, just you have to be prepared for a turbulent ride because your key performers are vulnerable. I'm with HF where I think moderately more investment right now (last window) would have made a real difference and I resent that it didnt. What I don't think however is that the level of investment that's being suggested by Oz would guarantee you kept your top players. The self-financing model is, to a degree, a player turnover model.

 

The point was made the other day, Spurs sold Berba and Carrick-their 'best' players. Theres no way they would have stayed. Spurs then kicked on. Well that clearly isn't keeping all your best players, it's about being massively canny about who you do and don't retain and what you do with the proceeds. It's a hugely pragmatic model, so in turn if you're going to seek to impugn it you're going to have to offer a more robustly pragmatic counterpoint than: ' '

[ChezGiven 0]

Not sure why the "break even" cheerleaders even see it as an issue. Most of us understand a club needs investment. For all his protestations about running a break even operation, Mike Ashley understands that he's required to put his own money into the club. He said himself he was willing to do so, to the tune of £20m a season.

 

Having bought the club for £140m, now in his fifth year (5 x £20m = £100m), he's only spent about 10% more than he had gone into it expecting to.

 

The problem is he's spent too much of it covering losses that were to a large extent down to him and entirely avoidable, rather than spending it on the squad.

 

The £20m a year comment was made a few years back, I doubt now whether he's prepared to put any more money into the club at all.

 

Whatever his approach was or is, it shows that he knows as well as any of us that it needs investment to succeed.

 

The arguments for being tight and having a mediocre team are legitimate, and the arguments for pushing the boat out and trying to compete are too. Which is why it's an argument that's gone on here for years and years. The only question is what sort of owner you have and what he can afford. It's our great misfortune to have a bloke who's spent enough to be making a challenge....but he's spent it reactively on losses rather than pro-actively on building revenue, without ever coming close to success.

 

That sort of incompetence would be forgiveable. The suggestion that we're now going to climb the table and prove a great success, without any investment, is a contradiction of what we all know and what he said himself.

Just trying to unpick what you are saying.

 

That he has reactively spent money but only after we were relegated to cover losses? That this is unforgivable? Yes but so what, that wont magic any more money into our coffers now. It puts some of the blame for our finances in his court, it shows him as incompetent but it doest build an argument against current decision-making. In fact, in reality it supports current decision-making because it shows the inherent risks of having a high wage bill and the wrong playing staff and manager.

 

If clubs do invest significant sums, the returns they are looking for is a bit more than 'getting the fans onside'. It has to be real and tangible, as Sunderland and Villa are struggling to deal with this season. To compete with Liverpool and Spurs through an 'investment strategy' would mean large amounts of coin the club doesnt have, no guarantee that it will bring results and no real pay-off even if the final position is 6th or 7th.

 

Wasnt aiming a comment at you when i re-defined the term apologist generally aimed elsewhere. Just a quick note though - what do you expect for £70m? Fuck all when its dealing with a financial basket case whilst at the same time owners at Stoke, Bolton, Fulham etc have personally invested much much more. Remember if a club has 20,000 less supporters in the ground but has an owner prepared to invest £10m a year, there is no difference between what we can pay wages wise.

[OTF 7090]

But when you're not, what do you do ??

 

The pursuit of success within the constraints of responsible financial practice should be a gradual process, not a large push for immediate success.

 

This would be achieved by retaining your best players and replacing your weaker ones with superior performers on a gradual basis. There is every chance that these players may cost more and be on higher wages, but the idea is for this to be offset by an increase in match attendance, merchandise sales, sponsorship money, prize money (higher league position, further in Cup competitions and ultimately qualification for European competition), and an increased value in the club along with its a superior perceived position in relation to other clubs.

 

This is obviously not the model that Ashley is operating under, regardless of what they say.

 

Any risk taken should be a manageable one.

 

 

Good luck selling that dream to your 'top players'/ambitious stars.

 

Nah, not the real world I'm afraid. Truly 'in demand' players will want a wage hike every few years and rapid progression, because as long as they're truly 'in demand' there'll be one of three or four clubs at the top prepared to offer them that. It's a nice thought, but it's ridiculous to suggest you're going to keep all your best players by showing them some cautiously incremental model. As Leazes says, the very top players want silverware now (ps and money), so you can't really have it both ways (even though he's suggesting you can by agreeing with you).

 

Also, the turnover point does now need to be addressed square on. Not simply 'increase turnover', but suggest how much realistically it can be increased by, and how much difference, realistically speaking (in the context of bankrolled opponents budgets) , that can mean to our player acquisition/retention. This debate really does need to be rooted in the real world now.

 

HF makes some good, moderate points in his last few posts. Lets keep it going in that direction.

 

Obviously only the general idea, you can't allow for all circumstances. In the case of in-demand players ultimately you'd want to be getting them frequently onto new, improved contracts (hello Andy, Tiote) to somewhat mitigate that risk. The longer their contract the greater the bargaining power, and the greater the transfer fee. This could then be put to use to actual improve the squad. Sure you may have lost one of your best players but you've done so knowing that the money from that sale, if spent well, will result in a better more balanced team. It's what Spurs have done with the money from the likes of Berbatov and Carrick.

 

The way you put it you'd think there would only be good players in three or four clubs - that's simply not the case. I'm not sure what you're implying my point is, but I'm saying that the team should be invested in on an ongoing basis and not a large splurge with the hope for immediate success.

 

Under the model I'm talking about the money from Carroll's sale would largely have been invested in the playing squad, Enrique still would have gone, but offering Barton an improved contract would have been a priority. Nolan would have been offered a 1 or 2 year extension. If he refused it the talks would have been put on hold for the season to determine whether he maintained the same level of influence on the side, and with that information potentially been re-opened or alternately he could be sold with 1 year remaining. All of the other business would still have been conducted with the additional spend from the Carroll money having bought in 1 good forward, a natural left back and some cover in central defense. All of this IMO is completely realistic and financially responsible and would have plainly been a sign to fans and players alike that the club is moving in the right direction.

 

Anyway, I don't profess to be an expert on any of this just offering my opinion. Feel free to shoot it down at will.

[manc-mag 1]

But when you're not, what do you do ??

 

The pursuit of success within the constraints of responsible financial practice should be a gradual process, not a large push for immediate success.

 

This would be achieved by retaining your best players and replacing your weaker ones with superior performers on a gradual basis. There is every chance that these players may cost more and be on higher wages, but the idea is for this to be offset by an increase in match attendance, merchandise sales, sponsorship money, prize money (higher league position, further in Cup competitions and ultimately qualification for European competition), and an increased value in the club along with its a superior perceived position in relation to other clubs.

 

This is obviously not the model that Ashley is operating under, regardless of what they say.

 

Any risk taken should be a manageable one.

 

 

Good luck selling that dream to your 'top players'/ambitious stars.

 

Nah, not the real world I'm afraid. Truly 'in demand' players will want a wage hike every few years and rapid progression, because as long as they're truly 'in demand' there'll be one of three or four clubs at the top prepared to offer them that. It's a nice thought, but it's ridiculous to suggest you're going to keep all your best players by showing them some cautiously incremental model. As Leazes says, the very top players want silverware now (ps and money), so you can't really have it both ways (even though he's suggesting you can by agreeing with you).

 

Also, the turnover point does now need to be addressed square on. Not simply 'increase turnover', but suggest how much realistically it can be increased by, and how much difference, realistically speaking (in the context of bankrolled opponents budgets) , that can mean to our player acquisition/retention. This debate really does need to be rooted in the real world now.

 

HF makes some good, moderate points in his last few posts. Lets keep it going in that direction.

 

Obviously only the general idea, you can't allow for all circumstances. In the case of in-demand players ultimately you'd want to be getting them frequently onto new, improved contracts (hello Andy, Tiote) to somewhat mitigate that risk. The longer their contract the greater the bargaining power, and the greater the transfer fee. This could then be put to use to actual improve the squad. Sure you may have lost one of your best players but you've done so knowing that the money from that sale, if spent well, will result in a better more balanced team. It's what Spurs have done with the money from the likes of Berbatov and Carrick.

 

The way you put it you'd think there would only be good players in three or four clubs - that's simply not the case. I'm not sure what you're implying my point is, but I'm saying that the team should be invested in on an ongoing basis and not a large splurge with the hope for immediate success.

 

Under the model I'm talking about the money from Carroll's sale would largely have been invested in the playing squad, Enrique still would have gone, but offering Barton an improved contract would have been a priority. Nolan would have been offered a 1 or 2 year extension. If he refused it the talks would have been put on hold for the season to determine whether he maintained the same level of influence on the side, and with that information potentially been re-opened or alternately he could be sold with 1 year remaining. All of the other business would still have been conducted with the additional spend from the Carroll money having bought in 1 good forward, a natural left back and some cover in central defense. All of this IMO is completely realistic and financially responsible and would have plainly been a sign to fans and players alike that the club is moving in the right direction.

 

Anyway, I don't profess to be an expert on any of this just offering my opinion. Feel free to shoot it down at will.

 

I'm not shooting it down, I agree with it in the main as you'll see from the post which followed on (which cites the same Berba/Carrick example). My only criticism was merely saying that it needs to be a more rounded, real world discussion, because that's the only sensible discussion to be having now-but then you've basically moved it along with the post above anyway, so fair play, mate.

[manc-mag 1]

Not sure why the "break even" cheerleaders even see it as an issue. Most of us understand a club needs investment. For all his protestations about running a break even operation, Mike Ashley understands that he's required to put his own money into the club. He said himself he was willing to do so, to the tune of £20m a season.

 

Having bought the club for £140m, now in his fifth year (5 x £20m = £100m), he's only spent about 10% more than he had gone into it expecting to.

 

The problem is he's spent too much of it covering losses that were to a large extent down to him and entirely avoidable, rather than spending it on the squad.

 

The £20m a year comment was made a few years back, I doubt now whether he's prepared to put any more money into the club at all.

 

Whatever his approach was or is, it shows that he knows as well as any of us that it needs investment to succeed.

 

The arguments for being tight and having a mediocre team are legitimate, and the arguments for pushing the boat out and trying to compete are too. Which is why it's an argument that's gone on here for years and years. The only question is what sort of owner you have and what he can afford. It's our great misfortune to have a bloke who's spent enough to be making a challenge....but he's spent it reactively on losses rather than pro-actively on building revenue, without ever coming close to success.

 

That sort of incompetence would be forgiveable. The suggestion that we're now going to climb the table and prove a great success, without any investment, is a contradiction of what we all know and what he said himself.

Just trying to unpick what you are saying.

 

That he has reactively spent money but only after we were relegated to cover losses? That this is unforgivable? Yes but so what, that wont magic any more money into our coffers now. It puts some of the blame for our finances in his court, it shows him as incompetent but it doest build an argument against current decision-making. In fact, in reality it supports current decision-making because it shows the inherent risks of having a high wage bill and the wrong playing staff and manager.

 

If clubs do invest significant sums, the returns they are looking for is a bit more than 'getting the fans onside'. It has to be real and tangible, as Sunderland and Villa are struggling to deal with this season. To compete with Liverpool and Spurs through an 'investment strategy' would mean large amounts of coin the club doesnt have, no guarantee that it will bring results and no real pay-off even if the final position is 6th or 7th.

 

Wasnt aiming a comment at you when i re-defined the term apologist generally aimed elsewhere. Just a quick note though - what do you expect for £70m? Fuck all when its dealing with a financial basket case whilst at the same time owners at Stoke, Bolton, Fulham etc have personally invested much much more. Remember if a club has 20,000 less supporters in the ground but has an owner prepared to invest £10m a year, there is no difference between what we can pay wages wise.

 

At the risk of sounding horribly obsequious, the back-and-forth between you two genuinely has moved the debate along on this forum and it's been needed for a long time. Not that you represent each 'side' of the debate as such, but I reckon people have found both 'sides' more accessible and palatable given the manner in which you've examined it all between you. I know I have anyway. Good craic.

[Happy Face 29]

Just trying to unpick what you are saying.

 

That he has reactively spent money but only after we were relegated to cover losses? That this is unforgivable? Yes but so what, that wont magic any more money into our coffers now. It puts some of the blame for our finances in his court, it shows him as incompetent but it doest build an argument against current decision-making. In fact, in reality it supports current decision-making because it shows the inherent risks of having a high wage bill and the wrong playing staff and manager.

 

The first question is demonstrably true and unarguable. The second I think I answered in my post. It is forgiveable to be relegated and (although patently done with only self-interest in mind) commendable to stick at it and secure a quick return. Though I guess these are just rhetorical questions leading up to your main point. IF it shows the risk of a high wage bill though, then it seems strange for Llambias to be shouting about a 7% increase in wages as a proportion of tunover. Hardly a lesson learned if the current decision-making they suggest is to increase the wage bill to 65%. Another lesson to learn could have been that you either keep your best players or fill positions where you're lacking in any quality so as NOT to get relegated in the first place, but the lack of investment in a striker seems to suggest THAT lesson hasn't been learned either.

 

The fact i don't believe his claims about wages, or that the plan has changed according to lessons learned since we sold Given and N'zogbia is what's unforgiveable.

 

If clubs do invest significant sums, the returns they are looking for is a bit more than 'getting the fans onside'. It has to be real and tangible, as Sunderland and Villa are struggling to deal with this season. To compete with Liverpool and Spurs through an 'investment strategy' would mean large amounts of coin the club doesnt have, no guarantee that it will bring results and no real pay-off even if the final position is 6th or 7th.

 

No argument here. It's the point that Alex was making to TP earlier though. When do we choose to seperate Ashley from 'the club' and vice versa? The club doesn't have the money, but Ashley does. His decision entirely as to how much of his wealth he puts on the line. But the claim is that we'll start reinvesting in the squad properly once the club is supporting itself. With £140m+ of debt to be paid off that will be a long long way off.

 

 

Wasnt aiming a comment at you when i re-defined the term apologist generally aimed elsewhere. Just a quick note though - what do you expect for £70m? Fuck all when its dealing with a financial basket case whilst at the same time owners at Stoke, Bolton, Fulham etc have personally invested much much more. Remember if a club has 20,000 less supporters in the ground but has an owner prepared to invest £10m a year, there is no difference between what we can pay wages wise.

 

Yep.

 

Again this shows up the ambition of climbing the table as a club that pays it's own way though. If even the smaller clubs like Fulham have an owner willing to give interest free loans up to £180m, then we're going to struggle to challenge them and pay off the debt and accrue no further debts....like Llambias says we will.

Edited September 21, 2011 by Happy Face

[Happy Face 29]

At the risk of sounding horribly obsequious, the back-and-forth between you two genuinely has moved the debate along on this forum and it's been needed for a long time. Not that you represent each 'side' of the debate as such, but I reckon people have found both 'sides' more accessible and palatable given the manner in which you've examined it all between you. I know I have anyway. Good craic.

 

We've got CT to thank for it IYAM.

 

He left and the discussion flourished.

 

[Guest Your Name Here]

RE the 7% wage increase – probably be due to turnover going down not wages going up.

 

In theory any owner should be capable of running a club at break even. In business terms not spending more than is coming in is about as basic as it gets , page one on the idiots guide to running a business. We could have just about anybody running the club on this basis, which begs the question – what is the point of FMA?

[ewerk 29484]

RE the 7% wage increase – probably be due to turnover going down not wages going up.

 

In theory any owner should be capable of running a club at break even. In business terms not spending more than is coming in is about as basic as it gets , page one on the idiots guide to running a business. We could have just about anybody running the club on this basis, which begs the question – what is the point of FMA?

 

Football isn't just any business though.

[Park Life 71]

Just trying to unpick what you are saying.

 

That he has reactively spent money but only after we were relegated to cover losses? That this is unforgivable? Yes but so what, that wont magic any more money into our coffers now. It puts some of the blame for our finances in his court, it shows him as incompetent but it doest build an argument against current decision-making. In fact, in reality it supports current decision-making because it shows the inherent risks of having a high wage bill and the wrong playing staff and manager.

 

The first question is demonstrably true and unarguable. The second I think I answered in my post. It is forgiveable to be relegated and (although patently done with only self-interest in mind) commendable to stick at it and secure a quick return. Though I guess these are just rhetorical questions leading up to your main point. IF it shows the risk of a high wage bill though, then it seems strange for Llambias to be shouting about a 7% increase in wages as a proportion of tunover. Hardly a lesson learned if the current decision-making they suggest is to increase the wage bill to 65%. Another lesson to learn could have been that you either keep your best players or fill positions where you're lacking in any quality so as NOT to get relegated in the first place, but the lack of investment in a striker seems to suggest THAT lesson hasn't been learned either.

 

The fact i don't believe his claims about wages, or that the plan has changed according to lessons learned since we sold Given and N'zogbia is what's unforgiveable.

 

If clubs do invest significant sums, the returns they are looking for is a bit more than 'getting the fans onside'. It has to be real and tangible, as Sunderland and Villa are struggling to deal with this season. To compete with Liverpool and Spurs through an 'investment strategy' would mean large amounts of coin the club doesnt have, no guarantee that it will bring results and no real pay-off even if the final position is 6th or 7th.

 

No argument here. It's the point that Alex was making to TP earlier though. When do we choose to seperate Ashley from 'the club' and vice versa? The club doesn't have the money, but Ashley does. His decision entirely as to how much of his wealth he puts on the line. But the claim is that we'll start reinvesting in the squad properly once the club is supporting itself. With £140m+ of debt to be paid off that will be a long long way off.

 

 

Wasnt aiming a comment at you when i re-defined the term apologist generally aimed elsewhere. Just a quick note though - what do you expect for £70m? Fuck all when its dealing with a financial basket case whilst at the same time owners at Stoke, Bolton, Fulham etc have personally invested much much more. Remember if a club has 20,000 less supporters in the ground but has an owner prepared to invest £10m a year, there is no difference between what we can pay wages wise.

 

Yep.

 

Again this shows up the ambition of climbing the table as a club that pays it's own way though. If even the smaller clubs like Fulham have an owner willing to give interest free loans up to £180m, then we're going to struggle to challenge them and pay off the debt and accrue no further debts....like Llambias says we will.

 

There is still a kind of glass ceiling where clubs outside the core top 4/5 concerned in the sense they have to pay a premium to lock in players who are perhaps looking above what we or other 2nd tier (and it pains me to phrase it like that) clubs can offer with regard to success and prestige tournament participation like the CL.

 

Man City came across that issue because they were competing in a market the last two seasons where the players they targeted were natural targets for ManU and Chelsea and the other top tier outfits in Europe. They broke that glass ceiling by naked spending power.

[peasepud 59]

Also, the turnover point does now need to be addressed square on. Not simply 'increase turnover', but suggest how much realistically it can be increased by, and how much difference, realistically speaking (in the context of bankrolled opponents budgets) , that can mean to our player acquisition/retention. This debate really does need to be rooted in the real world now.

 

HF makes some good, moderate points in his last few posts. Lets keep it going in that direction.

 

2007

4 (2) Man United £242.6m

6 (5) Chelsea £221m

9 (10) Arsenal £192.4m

10 (8) Liverpool £176m

13 (12) Newcastle £124.3m

15 (13) Tottenham £107.2m

17 (17) Man City £89.4m

18 (n/a) Rangers £88.5

19 (n/a) West Ham £60.1m

 

 

2008

2 (4) Manchester United £212.1m

4 (6) Chelsea £190.5m

5 (9) Arsenal £177.6m

8 (10) Liverpool £133.9m

11 (15) Tottenham Hotspur £103.1m

14 (13) Newcastle United £87.1m

17 (-) Celtic £75.2m

 

 

2009

2 (2) Manchester United £257.1m

5 (4) Chelsea £212.9m

6 (5) Arsenal £209.3m

7 (8) Liverpool £167.0m

14 (10) Tottenham £114.8m

17 (14) Newcastle £99.4m

20 (-) Manchester City £82.3m

 

 

 

2010

3 (2) Man Utd £278.5m

5 (6) Arsenal £224.0m

6 (5) Chelsea £206.4m

7 (8) Liverpool £184.8m

15 (14) Tottenham £113.0m

19 (n/a) Man City £87.0m

20 (17) Newcastle £86.0m

 

 

Man U 242.6 > 278.5 = +14.79%

Arsenal 192.4 > 224.0 = +16.42%

Chelsea 221 > 206 = -6.79%

Liverpool > 176 > 184.8 = +5%

Spurs 107.2 > 113 = +5.41%

Man C > 89.4 > 87 = -2.69%

Toon 124.3 > 86 = -30.82%

 

On average, the highest Earnings clubs in England have seen an increase of 5.35% in turnover so I dont think its unrealistic to think that we could have done the same.

 

So to answer your question. We should have been looking at £130m turnover not the current £86m.

[LeazesMag 0]

All Fat Mike had to do was reduce the costs, because the revenues were automatic and guaranteed, weren't they.

 

Ho Hum.

 

Edit.

 

and when people say "we should have to accept selling our best players to the bigger clubs" [words to that effect], which clubs are they talking about exactly ?

 

Spurs ? Villa ? Wigan ? Liverpool ? West Ham ? QPR ?

 

Now if we had replaced Carroll, Enrique, Barton and Nolan with the likes of Van der Vaart, Modric, and Gareth Bale [for instance], they would have a point.

Edited September 21, 2011 by LeazesMag

[Park Life 71]

Our target turnover should be 150m. End of.

[LeazesMag 0]

Our target turnover should be 150m. End of.

 

Shola Ameobi shirts are selling like hot cakes in the Far East mate, we need more like him.

[Park Life 71]

Our target turnover should be 150m. End of.

 

Shola Ameobi shirts are selling like hot cakes in the Far East mate, we need more like him.

 

[manc-mag 1]

Also, the turnover point does now need to be addressed square on. Not simply 'increase turnover', but suggest how much realistically it can be increased by, and how much difference, realistically speaking (in the context of bankrolled opponents budgets) , that can mean to our player acquisition/retention. This debate really does need to be rooted in the real world now.

 

HF makes some good, moderate points in his last few posts. Lets keep it going in that direction.

 

2007

4 (2) Man United £242.6m

6 (5) Chelsea £221m

9 (10) Arsenal £192.4m

10 (8) Liverpool £176m

13 (12) Newcastle £124.3m

15 (13) Tottenham £107.2m

17 (17) Man City £89.4m

18 (n/a) Rangers £88.5

19 (n/a) West Ham £60.1m

 

 

2008

2 (4) Manchester United £212.1m

4 (6) Chelsea £190.5m

5 (9) Arsenal £177.6m

8 (10) Liverpool £133.9m

11 (15) Tottenham Hotspur £103.1m

14 (13) Newcastle United £87.1m

17 (-) Celtic £75.2m

 

 

2009

2 (2) Manchester United £257.1m

5 (4) Chelsea £212.9m

6 (5) Arsenal £209.3m

7 (8) Liverpool £167.0m

14 (10) Tottenham £114.8m

17 (14) Newcastle £99.4m

20 (-) Manchester City £82.3m

 

 

 

2010

3 (2) Man Utd £278.5m

5 (6) Arsenal £224.0m

6 (5) Chelsea £206.4m

7 (8) Liverpool £184.8m

15 (14) Tottenham £113.0m

19 (n/a) Man City £87.0m

20 (17) Newcastle £86.0m

 

 

Man U 242.6 > 278.5 = +14.79%

Arsenal 192.4 > 224.0 = +16.42%

Chelsea 221 > 206 = -6.79%

Liverpool > 176 > 184.8 = +5%

Spurs 107.2 > 113 = +5.41%

Man C > 89.4 > 87 = -2.69%

Toon 124.3 > 86 = -30.82%

 

On average, the highest Earnings clubs in England have seen an increase of 5.35% in turnover so I dont think its unrealistic to think that we could have done the same.

 

So to answer your question. We should have been looking at £130m turnover not the current £86m.

 

Good stuff! ....so about £44 million discrepant on turnover for arguments sake.

 

So, using massively massively basic mathematics (and apologies to the economists for this), what amount are we counterbalancing against that in terms of servicing that higher turnover (transfer fees/wages)?

 

The bottom line is a sustainability model now, whether we like that or not. That is a financial reality. So the first thing you'd have to question I spose is whether the £130 million turnover is a self sustaining amount to start with (because if it isn't, it's not a live issue for discussion in the first place), but if it is the second question becomes what sort of players it would it allow us to buy/retain which we're not already buying/retaining.*

 

Anyway just trying to keep this thing moving..any help from more forensic minds would be appreciated as I know this is both i) incomplete, and ii) highly speculative....

 

For me it's not about pie-in-the sky stuff. If we genuinely were skint (ie being run on debt and at a loss), then fair enough it doesn't matter what our max turnover can be per se, it's what it costs to achieve that turnover. So I'm more interested in knowing what realistic margins, if we are now having to be self-financing, should be available for continued team improvements within certain ratios, and what level that should let you kick on to in a footballing sense, given the budgets of the teams around you. On this point, I'm on record as saying I think we were absolutely diddled out of a striker in the last window...however I have to concede that's an emotional statement rather than a pure financial one.

 

*So not that it's remotely scientific, but just because it's the only vague anecdotal stuff we have to 'compare' for our value for money, are there any points we can regard as 'settled' to move the argument along? Might float a few for everyone's consideration:

 

1. Most pre-2007 seasons saw an operating loss, thus previous player acquisitions/wages paid over that period are not to be regarded as achievable on a sustainability model

2. Turnover vs expenditure: If the average first team salary is around (genuinely don't know - £30k pw less now than it was formerly???)....that's circa 1.5 million per year per player x 15.... £22 million less on wages per annum.

 

(genuine guess work there obviously but we know Shearer and Owen were both £100k+, Martins, Viduka, £80's others prob around £50-60 as standard) ...we've still got Colo and Smith on big money, but the new ceiling is about £50k (Tiote) with new recruits I reckon coming in on around £10-30k....)

[manc-mag 1]

PS I know that's a bit garbled but hopefully some relevant strands emerge, even if not instantly. Equally if theres any false premises, shoot them down now. For me it's all about narrowing the issues if possible.

[ChezGiven 0]

Also, the turnover point does now need to be addressed square on. Not simply 'increase turnover', but suggest how much realistically it can be increased by, and how much difference, realistically speaking (in the context of bankrolled opponents budgets) , that can mean to our player acquisition/retention. This debate really does need to be rooted in the real world now.

 

HF makes some good, moderate points in his last few posts. Lets keep it going in that direction.

 

2007

4 (2) Man United £242.6m

6 (5) Chelsea £221m

9 (10) Arsenal £192.4m

10 (8) Liverpool £176m

13 (12) Newcastle £124.3m

15 (13) Tottenham £107.2m

17 (17) Man City £89.4m

18 (n/a) Rangers £88.5

19 (n/a) West Ham £60.1m

 

 

2008

2 (4) Manchester United £212.1m

4 (6) Chelsea £190.5m

5 (9) Arsenal £177.6m

8 (10) Liverpool £133.9m

11 (15) Tottenham Hotspur £103.1m

14 (13) Newcastle United £87.1m

17 (-) Celtic £75.2m

 

 

2009

2 (2) Manchester United £257.1m

5 (4) Chelsea £212.9m

6 (5) Arsenal £209.3m

7 (8) Liverpool £167.0m

14 (10) Tottenham £114.8m

17 (14) Newcastle £99.4m

20 (-) Manchester City £82.3m

 

 

Man U 242.6 > 278.5 = +14.79%

Arsenal 192.4 > 224.0 = +16.42%

Chelsea 221 > 206 = -6.79%

Liverpool > 176 > 184.8 = +5%

Spurs 107.2 > 113 = +5.41%

Man C > 89.4 > 87 = -2.69%

Toon 124.3 > 86 = -30.82%

 

On average, the highest Earnings clubs in England have seen an increase of 5.35% in turnover so I dont think its unrealistic to think that we could have done the same.

 

So to answer your question. We should have been looking at £130m turnover not the current £86m.

 

Think your data is wrong, when i saw £124m i thought thats wrong. It was £87.1m in 2007 according to Swiss Ramble, not a perfect source but highly reputable.

 

 

So your % change may be wrong too.

 

With a full house, busy VIP boxes, European football and new TV deal, we should be able to break £110m.

[Park Life 71]

PS I know that's a bit garbled but hopefully some relevant strands emerge, even if not instantly. Equally if theres any false premises, shoot them down now. For me it's all about narrowing the issues if possible.

 

I honestly don't think you can be competitive on an ongoing self-fianacing model.

 

There are always ups and downs...Some seasons extra cash has to be generated (that either comes from loans/player sales/ cash from owners).

[ChezGiven 0]

PS I know that's a bit garbled but hopefully some relevant strands emerge, even if not instantly. Equally if theres any false premises, shoot them down now. For me it's all about narrowing the issues if possible.

Like closing time at the City Tavern.

 

To answer (i think) your question of whether it possible to sustain a £130m turnover, i'd want to check that first as a figure. To see what the potential is you need to look at Match day, Media and Commercial.

 

Our highest matchday revenue appears to be £35m in 2005 when we got to the UEFA quarters. It was £21m in the last 09/10 accounts.

 

Media is now £50m+. This is probably the highest it will ever be unless overseas markets support bigger deals next time. Emerging markets are still an opportunity to boost the TV money but thats a premiership thing as it negotiates collectively.

 

The highest commercial income was £27m in 2007. We are currently at £15.4m. This has fallen massively and includes where money from branding and signage etc should be included.

 

So, if the club wants to consider itself as 'running a good business' it should be looking at the potential in each of the major revenue streams through its recent maximum level. £35m +£50m + £27m, which is a £112m (i was close in my earlier post). In the hard nosed business evaluation, there is £26m in revenue left on the table (12m from commercial and £14m from matchdays).

 

Conditions arent the same and there are reasons why potential may be less than that but its a good benchmark.

[manc-mag 1]

PS I know that's a bit garbled but hopefully some relevant strands emerge, even if not instantly. Equally if theres any false premises, shoot them down now. For me it's all about narrowing the issues if possible.

Like closing time at the City Tavern.

 

To answer (i think) your question of whether it possible to sustain a £130m turnover, i'd want to check that first as a figure. To see what the potential is you need to look at Match day, Media and Commercial.

 

Our highest matchday revenue appears to be £35m in 2005 when we got to the UEFA quarters. It was £21m in the last 09/10 accounts.

 

Media is now £50m+. This is probably the highest it will ever be unless overseas markets support bigger deals next time. Emerging markets are still an opportunity to boost the TV money but thats a premiership thing as it negotiates collectively.

 

The highest commercial income was £27m in 2007. We are currently at £15.4m. This has fallen massively and includes where money from branding and signage etc should be included.

 

So, if the club wants to consider itself as 'running a good business' it should be looking at the potential in each of the major revenue streams through its recent maximum level. £35m +£50m + £27m, which is a £112m (i was close in my earlier post). In the hard nosed business evaluation, there is £26m in revenue left on the table (12m from commercial and £14m from matchdays).

 

Conditions arent the same and there are reasons why potential may be less than that but its a good benchmark.

 

Cheeky fucker.

 

I know I was rambling because for the most part I know it's not possible to answer the question by 'reverse engineering' things. Ie £130 million turnover, but how much do you have to spend on players to get that money coming in? Total unknown, obviously. Again obviously if you're looking at it purely from a financial p.o.v, it doesnt matter if your turnover is 13 million or 130 million as long as you're breaking even, but we're not, we're football fans, so playing Ashley's purported game, assuming a £130 million turnover gets you a better chance of success than a £13 million one, how much would hitting this turnover actually measure up for Ashley as a risk?

 

The only things I can tell we need to get some sort of vague agreement on are:

 

1. What sort of turnover is possible based on full house matchday/max exposure TV revs?

2. Is it possible to reach those levels sustainably (not scientific, but full revs imply (in my view) something approximating a European level finish (not CL)

3. What we're currently spending/where that leaves us in the league

4. How much more would it realistically cost to close the gap between 2&3 (again, not scientific, but can be reasonably judged against what money other clubs are chucking about to do the same thing/what the going rates are)

 

Retention is the key one for me btw; it's easy saying offer someone £10k above the wage cap to keep them, they're worth it, but when that then becomes every players target on re-negotiation, you can easy be talking an extra £5-10 million per year just to keep the same players and then you have to introduce new ones at a higher rate too. That's when it gets 'easier' to stick to a wage cap and constantly re-recruit. In the purely financial sense.