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In attendance: Lancashire Business View, Ben Briggs |
Is there too big-a-gap when it comes to TV money and the way it is distributed?
Frank Mckenna: The big gap is not because of the distribution of Premier League cash, it's because of the Champions League and that really means whichever one of those top four clubs does fall out, because one of them will, it could mean major financial problems for them.
David Acland: Liverpool manager Rafa Benitez has come out and said that the club budgets for the last 16 of the Champions League, not for group stages. That’s how they run the club, but If Liverpool do have an unlucky injury to Torres, or Gerrard goes off form, then they are out of the Champions League and that will cause Liverpool Football Club serious financial problems because of their well known debt position.
A major problem is that a football club has a wage structure that’s rigid and fixed for a period of time, whether it be one year or more likely three to five years. If your income drops, like it does in a recession and all four streams all suffer, there's nothing you can do about it. You simply have to go and beat the drum and work harder to get more income in rather than address the costs base which is what, as an insolvency practice, I would typically do.
Mike Needham: Almost every year without fail we have found that the wage structure is the most important thing when dictating how successful you are on the field.
David Acland: Having huge overheads and budgeting for success is a dangerous game. Take the Leeds United example. They had success but when it disappeared the had a huge drop down the leagues.
Rob Heys: It's amazing how quickly football clubs can fold. Ten years ago we were playing at places like Trafford and now we’re playing Bradford, who themselves were playing Manchester United, Arsenal and Chelsea a decade ago. It shows how quick things can change.
John Barker: Success has certainly encouraged smaller clubs. They look at Rovers and Burnley in the Premiership and see the success that those clubs have achieved and then look at Newcastle United with mass support and realise that smaller teams from smaller towns can hold their own.
David Acland: Burnley is an example to Blackpool, is an example to Preston, is an example to every Championship club in this area because it would be a fantastic elevation for them.
Read the full discussion in Lancashire Business View 29.
