50 or 60 clubs could go bust

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1964white
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50 or 60 clubs could go bust

Post by 1964white » Mon May 25, 2020 4:34 pm

English football's pyramid will be destroyed unless the game starts to plan for the financial impact of Covid-19 beyond the 2019-20 season, says Huddersfield owner Phil Hodgkinson.

Hodgkinson thinks as many as "50 or 60" clubs could go bust.

He says he is looking at a "worst-case scenario" of no fans allowed in stadiums for the 2020-21 season.

"The problem is not whether we finish [this] season or not, it is what happens after that,

"If we don't come to an agreement there will be no football pyramid. There are clubs I know of that are only still trading because they are deferring wages and [tax] and other creditors. They will need paying at some point," Hodgkinson said.

"There is an absolutely real, stark probability that if something isn't agreed now within football to ensure all clubs can pay their bills and get through to the point where income is resumed, you will be looking at 50 or 60 clubs ceasing to exist. Genuinely, I am talking about that many."

Hodgkinson says Huddersfield, three points above the Championship relegation zone, want the season to restart "when it is safe", with clubs set to return to training on Monday.

But he says the game "is not looking at the bigger picture", with the main focus being on restarting the current season.

"It will cost each club between £150,000 and £200,000 for testing to get to the end of the season," he said. "But what happens after that?

"We have been told by the government that there will be no large gatherings until there is a vaccine and that is likely to be in 2021. That means football clubs will lose a vast proportion of their income outside of any broadcast money, which is likely to be significantly reduced or clawed back anyway.

"In normal revenue, we are looking at losing between £7m and £10m. The claw-back for TV is going to be £10m-£30m. That is just us. So, what is football going to do to ensure the entire pyramid survives this? The discussion is being avoided. For the next three, six or 12 months clubs are going to have no income."

One solution Hodgkinson has suggested is reducing players' wages at every level of the game.

"The players are not to blame," he said. "But the reality is, the players have to be part of the solution because if clubs go bust, their contracts won't get met anyway.

"They may not like me saying this, but [players' union] the PFA need to put in place salary cuts of between 30% and 50% for all players at all levels until such a time as crowds are allowed back into football stadiums and income streams return.

"These are ideas. They may not be the right ones. But something has to be done because everyone knows what is coming and people are just sticking their heads in the sand."

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Re: 50 or 60 clubs could go bust

Post by faaip » Mon May 25, 2020 5:17 pm

Sky and the Premierships fault. They can pay for it. Football was stopped for the second world war for 6 years ...how many teams went bust then?..We could probably survived this in the seventies comfortably too.
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Re: 50 or 60 clubs could go bust

Post by 1964white » Mon May 25, 2020 5:35 pm

faaip wrote:
Mon May 25, 2020 5:17 pm
Sky and the Premierships fault. They can pay for it. Football was stopped for the second world war for 6 years ...how many teams went bust then?..We could probably survived this in the seventies comfortably too.
Different game financially now to the way football was in the 40's

Sky/Premiership has a lot to answer for & yes they should make a contribution to struggling clubs

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Re: 50 or 60 clubs could go bust

Post by weasel » Mon May 25, 2020 6:43 pm

I doubt the clubs were paying the wages of their players during the war. Likely that the majority of the players and club staff were actually fighting in the war
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Re: 50 or 60 clubs could go bust

Post by faaip » Mon May 25, 2020 9:28 pm

Agreed but my guess would be that footballers and soldiers weren't that far apart back then. How many soldiers do you think earn over a million a year now....?
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Re: 50 or 60 clubs could go bust

Post by Irish Ian » Mon May 25, 2020 10:29 pm

The whole structure of the Football league is unsustainable.

I had hoped that this crisis may have started the debate around a complete restructuring of the professional game.

But if it has started I havent noticed.

It wouldnt sadden me to see those clubs go out of business, if it led to a business model that actually worked.
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Re: 50 or 60 clubs could go bust

Post by Bally » Mon May 25, 2020 10:48 pm

Why's it Sky's fault?

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Re: 50 or 60 clubs could go bust

Post by weasel » Tue May 26, 2020 1:13 pm

Strange isn't it how so many fans were clamouring us to pay Kalvin Phillips what he was worth in the summer so as to keep him here. Is any footballer in our division worth what we are paying him? Yet it isn't Sky paying his wages and what choice do the club have if they want to satisfy the fans?

The only way to really sort it out is to do away with PPG and have a system where clubs have a salary cap based on the income the club brings in. Any additional money spent on player wages would have to come out of the owner's pocket and not be due back to him/her if they sold the club or placed the club in admin.
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Re: 50 or 60 clubs could go bust

Post by Irish Ian » Tue May 26, 2020 1:22 pm

Bally wrote:
Mon May 25, 2020 10:48 pm
Why's it Sky's fault?
Because since the formation of the Premier League, proportionately more money has stayed in the top league of the game.
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Re: 50 or 60 clubs could go bust

Post by faaip » Tue May 26, 2020 1:52 pm

If Sky and BT etc to a lesser extent stopped putting money into football the premiership would have to cut wages by 75% and transfer fees would be 20M for the best player in they could afford. Oligarch owners would disappear. That would bring the Championship much closer to the prem in terms of financial fair play..

It's why I stand up and applaud Norwich, they didn't play that game this season of promotion then spray money they don't have yet on any half decent but massively overpaid player that will only go there because a top 10 team don't want them. The money Sky via the EPL throws at the top flight also allows them to talent strip any club from a lower league and stick them on their reserve squad before loaning them back at extortionate terms.

I'd abolish loan fees and parachute payments to start with. The Championship payment per game needs to be quadrupled

the Premiership clubs earned around 3 billion pounds in 19/20 season

If we played 20 games on sky all at home we'd get around 2 million from sky, half home half away would be around 1.1 mil..Did we play 20 games on Sky last season? Despite them using us as a feature club (At one point we were shown more times than any other club in the country)
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Re: 50 or 60 clubs could go bust

Post by weasel » Tue May 26, 2020 3:24 pm

faaip wrote:
Tue May 26, 2020 1:52 pm
If Sky and BT etc to a lesser extent stopped putting money into football the premiership would have to cut wages by 75% and transfer fees would be 20M for the best player in they could afford. Oligarch owners would disappear. That would bring the Championship much closer to the prem in terms of financial fair play..

It's why I stand up and applaud Norwich, they didn't play that game this season of promotion then spray money they don't have yet on any half decent but massively overpaid player that will only go there because a top 10 team don't want them. The money Sky via the EPL throws at the top flight also allows them to talent strip any club from a lower league and stick them on their reserve squad before loaning them back at extortionate terms.

I'd abolish loan fees and parachute payments to start with. The Championship payment per game needs to be quadrupled

the Premiership clubs earned around 3 billion pounds in 19/20 season

If we played 20 games on sky all at home we'd get around 2 million from sky, half home half away would be around 1.1 mil..Did we play 20 games on Sky last season? Despite them using us as a feature club (At one point we were shown more times than any other club in the country)
The trouble is that Sky and BT (and others) are happy to pay a fortune because they know they will recoup it from people all over the world paying to watch the matches. People all over the world generally want to watch the premiership and whilst they have little interest in the likes of Bournemouth, Burnley etc they will watch Burnley v Man U as that is what the current fixture list throws up not Leeds v MU. Leeds are the anomaly as they are a championship club that have a lot of support over the world. The same however cannot be said for the majority of the rest of the championship. Not many viewers would really be that interested in Rotherham v Barnsley for example. As such the championship gets what it is worth in terms of what Sky get back - and that is largely f*ck all unless it is Leeds on. Take Leeds out of the Championship and their product is even less appealing as even though there are some reasonably big names still there they don't have the global appeal of Leeds. Derby v Forest as an example would be classed as a big game but only domestically and even then only really around Derby and Nottingham.

What Leeds needed was to be able to have their own tv rights. Screw the rest of the championship because the Leeds product would probably be worth more than the rest of the whole EFL if the club had solitary rights to televise our matches and distribute on their own tv channel - I am sure this was the main reason AR bought us as he had the platform to show our matches all over the world.

The FFP though is ridiculous - allowing teams to lose £13m per year as a business is ludicrous. But teams will continue to gamble as they know that even if they get just 1 season in the prem, like Norwich probably will 'achieve', it will repay their gamble several times over with the 1 year of prem money and then the parachute payments.
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Re: 50 or 60 clubs could go bust

Post by Bally » Wed May 27, 2020 10:54 pm

Irish Ian wrote:
Tue May 26, 2020 1:22 pm
Because since the formation of the Premier League, proportionately more money has stayed in the top league of the game.
But SKy also pay money for TV rights to the championship obviously not as much but why should they as demand isn't so high.
Ifit wasnt for TVmoney I'm sure some of the stadiums wouldnt be as impressive as they are now you can moan about SKY as much as you like but how much have Leeds made from them over the years would you prefer it if was like years gone by by when there was hardly any live TV and only highlights?
The premier league is one of the best in the world and this is partly down to TV money as they can afford the best how many other country's in the world can you name teams below the top division?

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Re: 50 or 60 clubs could go bust

Post by mav » Thu May 28, 2020 12:19 pm

The fault is with the clubs, paying 100%+ of turnover on wages??

I would be happier to see leeds trawl the lower leagues for players and struggle to stay up than jump on that ship again.
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