Surely they must have had an idea of what the running costs were when the bought the club and planned accordingly. I think some people judging without having any idea of the truth behind it.
I know pretty much nothing about business but wouldn't the losses be offsetable against tax from their other companies?
The suggestion from a year or two ago was that the real money was going to be spent (after buying the club etc) on getting CAFC out of L1, once into the Championship things would be more or less self-financing. That wasn't the case.
Part of the problem is that we still have no idea who is behind TJ and Slater and whether they are either sufficiently rich enough to continue investing/whether they have the inclination to keep feeding losses.
valid point, have the wheels come off tho? 7m losses to stand still.. I can see why peeps are concerned, is this the future of our club every few years? Is there an alternative and how?
But these losses haven't suddenly started under the current board, we've been in the brown stuff for several years prior, and indeed if it wasn't for Slater and Jiminez would have probably gone into administration or worse. We'd have decimated our team and been stuck in L1.
The financial structure of football makes no sense at all, that's the problem, and not something that any club can resolve by itself.
There was an indication earlier that the deal collapsed because the buyer was considered not up to it. It therefore could be good news it collapsed. Perhaps it means the current Board isn't desperate to sell (which is different from wanting to). Also it means the Board now knows where it stands. The last couple of months we would have been in limbo. Now they can get on and plan properly for the new season. Whether this will mean cost cutting or investment we will see in the next few weeks.
I have no problem with the Board being picky, the track record of mysterious overseas investors is pretty dubious, Portsmouth being the classic example.
For me in any loss making business you have to make choices, here's an example
a) sell and minimise your loss (ideal but what if you can't sell) small loss/break even/small profit b) carrying on adding to your losses and get nowhere, except more losses, but hold out for a sale, could be a £20m loss c) go for broke and find a bit more go for broke end up losing even more than b). £25m loss - or big jackpot payout d) wind it up and walk away with £15m loss e) pair it all down to break even, could be in League 1 the following year, and a further reduction in income
It must be (c) and hope aim for the jackpot bit! That MUST be the 5 year plan - otherwise they would never have bought into it in the first place. These are not stupid guys.
Seriously training up and selling on talented players is the way to go - Chris Solly, Ben Hamer and Rhoys Wiggins are our most bankable assets. Sell one of them and replace him with a free transfer/or preferably another young but talented kid who can be trained up and promote the odd academy player.
^^^^ this is how Crewe Alex has survived and partly prospered for years
"Partly" being the operative word - Crewe haven't risen to the Championship. The sale of our best young players without adequate replacement is a depressing prospect that has relegation written all over it.
^^^^ this is how Crewe Alex has survived and partly prospered for years
Its not pleasant but it works. I don't claim to know anything about any owners on a personal level, but I am pretty sure if a die hard, life long, Charlton in the blood fan was at the financial reins and selling Solly, Wiggins, Harriot would bring in money to keep the club as stable as possible, they would do it. Pragmatism is the only answer nowadays to any club owner whose not a billionaire.
^^^^ this is how Crewe Alex has survived and partly prospered for years
"Partly" being the operative word - Crewe haven't risen to the Championship. The sale of our best young players without adequate replacement is a depressing prospect that has relegation written all over it.
this is the downside of running a nursery .. you never see your flowers in full bloom and Crewe is in the highly competitive 'football heartland' surrounded by literally tens of bigger clubs from Stoke to Manchester .. it's a tiny club but still manages to hang in there
For me in any loss making business you have to make choices, here's an example
a) sell and minimise your loss (ideal but what if you can't sell) small loss/break even/small profit ONLY IF YOU CAN FIND A BUYER b) carrying on adding to your losses and get nowhere, except more losses, but hold out for a sale, could be a £20m loss ONLY IF YOU HAVE MONEY OR ACCESS TO LOANS TO KEEP GOING c) go for broke and find a bit more go for broke end up losing even more than b). £25m loss - or big jackpot payout ONLY IF YOU HAVE MONEY OR ACCESS TO LOANS d) wind it up and walk away with £15m loss NOT VERY ATTRACTIVE TO YOUR BACKERS e) pair it all down to break even, could be in League 1 the following year, and a further reduction in income WE CAN'T BREAK EVEN IN THIS LEAGUE AND WE HAVE PARRED IT DOWN ALMOST TO THE BONE ALREADY. LEAGUE ONE WOULD BE EVEN WORSE. OUR OVERHEAD ON THE VALLEY IS JUST TOO HIGH AND YOU THEN GET STUCK IN LEAGUE. OR WORSE.
what would you do?
Only A and B are real options since Kevin Cash stopped funding the Club but A & B rely on an outside party buying the Club which the current owners can't control.
All well and good saying sell Hamer, Wiggins and Solly but Hamer and Wiggins are now coming into the last year of there contracts and value going down. I think Solly is 2015 but may be 2014 s well.
I am understand they are looking for new buyers but I hope that this does mean we dont carry on and secure the better players for longer to ensure better sell out value or that we have these players still.
Peterborough would be a better example of break even... shame they got relegated as they manage their bills and sell top talent. The question is whether any buyer who can prove to the banks they are good for the money will be charitable to owners of a loss making business. I doubt it! The only two ways for CAFC to become an interesting proposition are to grow income (through gates and/or player sales) or push for promotion... If the current owners can't fund that push then perhaps new people just wait for them to hand the keys over just as Richard Murray did a few years back?
Peterborough would be a better example of break even... shame they got relegated as they manage their bills and sell top talent. The question is whether any buyer who can prove to the banks they are good for the money will be charitable to owners of a loss making business. I doubt it! The only two ways for CAFC to become an interesting proposition are to grow income (through gates and/or player sales) or push for promotion... If the current owners can't fund that push then perhaps new people just wait for them to hand the keys over just as Richard Murray did a few years back?
I think, realistically, there is only 1 way and that has to be the premier league - the new TV money blows everything else away! Increased ticket sales will not generate enough additional revenue and there are only a few players ready to be cashed-in...the plan must be to push on and make it to the promised land - even instant relegation the following season would still generate (like Palace) £100m+ and no amount of player sales or footfall through the turnstiles can do that.
^^^^ this is how Crewe Alex has survived and partly prospered for years
"Partly" being the operative word - Crewe haven't risen to the Championship. The sale of our best young players without adequate replacement is a depressing prospect that has relegation written all over it.
this is the downside of running a nursery .. you never see your flowers in full bloom and Crewe is in the highly competitive 'football heartland' surrounded by literally tens of bigger clubs from Stoke to Manchester .. it's a tiny club but still manages to hang in there
I'm sure we all hope and expect to do better than "hang in there", Lincs. We have a fruitful academy, a clever manager, a great club ethos, some very talented first-team players, an adequate ground, perfectly respectable attendance figures... If Norwich can get up to the Prem, and Southampton, and Palace - there's no reason why we can't join them, other than lack of ambition or lack of financial muscle on the part of the owners.
Peterborough would be a better example of break even... shame they got relegated as they manage their bills and sell top talent. The question is whether any buyer who can prove to the banks they are good for the money will be charitable to owners of a loss making business. I doubt it! The only two ways for CAFC to become an interesting proposition are to grow income (through gates and/or player sales) or push for promotion... If the current owners can't fund that push then perhaps new people just wait for them to hand the keys over just as Richard Murray did a few years back?
I think, realistically, there is only 1 way and that has to be the premier league - the new TV money blows everything else away! Increased ticket sales will not generate enough additional revenue and there are only a few players ready to be cashed-in...the plan must be to push on and make it to the promised land - even instant relegation the following season would still generate (like Palace) £100m+ and no amount of player sales or footfall through the turnstiles can do that.
Agreed. Last season, we were only a win or two from the playoffs, and with our late season form could easily be considering which £7m striker to buy. Selling players, unless you produce a Zaha, just doesn't cover the gap anymore.
Why are the overheads on The Valley so high? Stadium is generally in good order and is not the biggest either.
Is there something that is pushing the figure up in comparison to other stadiums in the league?
The majority of the clubs in our league have similar finances or far far worse. There will be the odd smaller club who runs a tight ship - I can't imagine Yeovil splashing the cash this season - but they are the exceptions.
Why are the overheads on The Valley so high? Stadium is generally in good order and is not the biggest either.
Is there something that is pushing the figure up in comparison to other stadiums in the league?
The Valley is much bigger than London Rd or Gresty Rd (P'Boro and Crewe's grounds). In league one it is huge in comparison to most others. So it requires a lot more in maintenance, rates, and stewards/staffing. Think about looking after a one bedroom flat or a five bedroom house. Which would cost more?
This is not just a problem for us but the "parr down costs and get by in league 1" theory was shown not to work. We almost got away with it the season Bailey missed the penalty but not quite.
We only got out of league 1 by spending a lot of Kevin Cash's cash. We lost £7.46m in league one. The board did very well WHEN WE HAD KEVIN'S CASH. Since he stopped the money we've been hard up as shown by the minimal investment last summer and the minimal investment this summer.
We are spending less than the maximum we can under Financial Fair Play but don't think that is because we are being clever or leaving room to splash out later. It's because Cash isn't funding the Club any more so we just don't have the money.
In the meantime Jimenez and Slater have kept the Club going for which they deserve some credit but don't kid yourself that it is all going smoothly and this was all planned.
The board want to sell and I hope they get their wish ASAP. What the new owners will be like we don't know but the same questions I was asking when this board took over still apply
Why are the overheads on The Valley so high? Stadium is generally in good order and is not the biggest either.
Is there something that is pushing the figure up in comparison to other stadiums in the league?
The Valley is much bigger than London Rd or Gresty Rd (P'Boro and Crewe's grounds). In league one it is huge in comparison to most others. So it requires a lot more in maintenance, rates, and stewards/staffing. Think about looking after a one bedroom flat or a five bedroom house. Which would cost more?
This is not just a problem for us but the "parr down costs and get by in league 1" theory was shown not to work. We almost got away with it the season Bailey missed the penalty but not quite.
We only got out of league 1 by spending a lot of Kevin Cash's cash. We lost £7.46m in league one. The board did very well WHEN WE HAD KEVIN'S CASH. Since he stopped the money we've been hard up as shown by the minimal investment last summer and the minimal investment this summer.
We are spending less than the maximum we can under Financial Fair Play but don't think that is because we are being clever or leaving room to splash out later. It's because Cash isn't funding the Club any more so we just don't have the money.
In the meantime Jimenez and Slater have kept the Club going for which they deserve some credit but don't kid yourself that it is all going smoothly and this was all planned.
The board want to sell and I hope they get their wish ASAP. What the new owners will be like we don't know but the same questions I was asking when this board took over still apply
1. Who owns the Club?
2. What is the Business Plan?
3. How is the Business Plan being funded?
4. What are the plans for the Valley?
5. What are the plans for the Academy?
6. What is the exit strategy?
Very good summary in my view. The good news is that whilst we're playing in the Championship the short-term interests of owners and fans are likely to be aligned because the only financially viable strategy is to aim for promotion. Any money spent is likely to be dead money unless promotion is achieved.
Ironically, the time to worry might be post promotion. With a minimum of £120m guaranteed, albeit over five years, the financial incentive to maintain the fabric of the Club is much reduced once promotion is secured. Ultimately, we need an owner who is in it for the glory even if they also want to run a tight ship.
Why are the overheads on The Valley so high? Stadium is generally in good order and is not the biggest either.
Is there something that is pushing the figure up in comparison to other stadiums in the league?
The Valley is much bigger than London Rd or Gresty Rd (P'Boro and Crewe's grounds). In league one it is huge in comparison to most others. So it requires a lot more in maintenance, rates, and stewards/staffing. Think about looking after a one bedroom flat or a five bedroom house. Which would cost more?
This is not just a problem for us but the "parr down costs and get by in league 1" theory was shown not to work. We almost got away with it the season Bailey missed the penalty but not quite.
We only got out of league 1 by spending a lot of Kevin Cash's cash. We lost £7.46m in league one. The board did very well WHEN WE HAD KEVIN'S CASH. Since he stopped the money we've been hard up as shown by the minimal investment last summer and the minimal investment this summer.
If it is such a cost issue, as it appears to be then it does rather raise the spectre of a new owner coming in and looking to move the club to a lower cost alternative venue, injecting cash into the club through the sale of the Valley to a property developer and frankly who could blame them! (Ducks for cover!).
Am I the only one who's happy to be a championship club? I like being able to afford going to a majority of games with good atmosphere
In many ways I agree with you - the hype of the premiership and plastic nature of many clubs plus the sacking of managers like McDemott and Atkins when their respective clubs were too close to the trapdoor for comfort means I empathise with you. But, in the Championship we are caught in no-man's land. Spending money to stand still and buying up/selling off talented players to keep afloat is a precarious existence.
Why are the overheads on The Valley so high? Stadium is generally in good order and is not the biggest either.
Is there something that is pushing the figure up in comparison to other stadiums in the league?
The Valley is much bigger than London Rd or Gresty Rd (P'Boro and Crewe's grounds). In league one it is huge in comparison to most others. So it requires a lot more in maintenance, rates, and stewards/staffing. Think about looking after a one bedroom flat or a five bedroom house. Which would cost more?
This is not just a problem for us but the "parr down costs and get by in league 1" theory was shown not to work. We almost got away with it the season Bailey missed the penalty but not quite.
We only got out of league 1 by spending a lot of Kevin Cash's cash. We lost £7.46m in league one. The board did very well WHEN WE HAD KEVIN'S CASH. Since he stopped the money we've been hard up as shown by the minimal investment last summer and the minimal investment this summer.
If it is such a cost issue, as it appears to be then it does rather raise the spectre of a new owner coming in and looking to move the club to a lower cost alternative venue, injecting cash into the club through the sale of the Valley to a property developer and frankly who could blame them! (Ducks for cover!).
I don't see it that way. Leaving the Valley and going somewhere else won't reduce costs.
A new owner is very unlikely to move us to a smaller ground as then you cut the potential for income generation. Also the 7 acres of building land at the Valley are worth less than the Stadium.
So the more likely option would be to move to a bigger ground with greater potential for income generation. But that means you need a very rich owner and a premiership team to fill the new ground. Not saying it will never happen but at the moment it is pie in the sky.
Comments
Part of the problem is that we still have no idea who is behind TJ and Slater and whether they are either sufficiently rich enough to continue investing/whether they have the inclination to keep feeding losses.
The financial structure of football makes no sense at all, that's the problem, and not something that any club can resolve by itself. I have no problem with the Board being picky, the track record of mysterious overseas investors is pretty dubious, Portsmouth being the classic example.
a) sell and minimise your loss (ideal but what if you can't sell) small loss/break even/small profit
b) carrying on adding to your losses and get nowhere, except more losses, but hold out for a sale, could be a £20m loss
c) go for broke and find a bit more go for broke end up losing even more than b). £25m loss - or big jackpot payout
d) wind it up and walk away with £15m loss
e) pair it all down to break even, could be in League 1 the following year, and a further reduction in income
what would you do?
hopeaim for the jackpot bit! That MUST be the 5 year plan - otherwise they would never have bought into it in the first place. These are not stupid guys.Sell Chris Solly.
I am understand they are looking for new buyers but I hope that this does mean we dont carry on and secure the better players for longer to ensure better sell out value or that we have these players still.
The question is whether any buyer who can prove to the banks they are good for the money will be charitable to owners of a loss making business. I doubt it!
The only two ways for CAFC to become an interesting proposition are to grow income (through gates and/or player sales) or push for promotion...
If the current owners can't fund that push then perhaps new people just wait for them to hand the keys over just as Richard Murray did a few years back?
Stadium is generally in good order and is not the biggest either.
Is there something that is pushing the figure up in comparison to other stadiums in the league?
This is not just a problem for us but the "parr down costs and get by in league 1" theory was shown not to work. We almost got away with it the season Bailey missed the penalty but not quite.
We only got out of league 1 by spending a lot of Kevin Cash's cash. We lost £7.46m in league one. The board did very well WHEN WE HAD KEVIN'S CASH. Since he stopped the money we've been hard up as shown by the minimal investment last summer and the minimal investment this summer.
We are spending less than the maximum we can under Financial Fair Play but don't think that is because we are being clever or leaving room to splash out later. It's because Cash isn't funding the Club any more so we just don't have the money.
In the meantime Jimenez and Slater have kept the Club going for which they deserve some credit but don't kid yourself that it is all going smoothly and this was all planned.
The board want to sell and I hope they get their wish ASAP. What the new owners will be like we don't know but the same questions I was asking when this board took over still apply
1. Who owns the Club?
2. What is the Business Plan?
3. How is the Business Plan being funded?
4. What are the plans for the Valley?
5. What are the plans for the Academy?
6. What is the exit strategy?
Ironically, the time to worry might be post promotion. With a minimum of £120m guaranteed, albeit over five years, the financial incentive to maintain the fabric of the Club is much reduced once promotion is secured. Ultimately, we need an owner who is in it for the glory even if they also want to run a tight ship.
A new owner is very unlikely to move us to a smaller ground as then you cut the potential for income generation. Also the 7 acres of building land at the Valley are worth less than the Stadium.
So the more likely option would be to move to a bigger ground with greater potential for income generation. But that means you need a very rich owner and a premiership team to fill the new ground. Not saying it will never happen but at the moment it is pie in the sky.