Club Finances

[Mally]

We already knew that the club was facing a very ambitious financial plan for this season - A loss of £250k (to be financed by Lenagan debt) IF executive box and sponsorship income could be increased by £100,000 over last year.

We now learn via OxVox that before the season has even started the club is at least £100,000 down on projected income from pre-season games. You have to ask how they could be so dramatically down on their projections. Was this because they wildly over estimated the attractiveness of games against Bournmouth, Luton, Wycombe and Birmingham or was it because they failed to secure more attractive opponents that had been planned?

I would have liked OxVox to have asked which it was but there's no suggestion that they did in the notes of their meeting with the club. Of course its quite possible that they did ask the question but the club edited out the question and response from the minutes as part of their censorship rights that OxVox have granted them. As a mere member of OxVox and season ticket holder there's no way of knowing. Or is there?

[GodalmingYellow]

We already knew that the club was facing a very ambitious financial plan for this season - A loss of £250k (to be financed by Lenagan debt) IF executive box and sponsorship income could be increased by £100,000 over last year.

We now learn via OxVox that before the season has even started the club is at least £100,000 down on projected income from pre-season games. You have to ask how they could be so dramatically down on their projections. Was this because they wildly over estimated the attractiveness of games against Bournmouth, Luton, Wycombe and Birmingham or was it because they failed to secure more attractive opponents that had been planned?

I would have liked OxVox to have asked which it was but there's no suggestion that they did in the notes of their meeting with the club. Of course its quite possible that they did ask the question but the club edited out the question and response from the minutes as part of their censorship rights that OxVox have granted them. As a mere member of OxVox and season ticket holder there's no way of knowing. Or is there?

It goes further than that as the club are obviously struggling to sell boxes to the level they had anticipated, as they have asked for OxVox and other supporters help on this.

Unless we have a good cup run or automatic promotion, I can easily imagine another loss close to 0.5 million this season.

Its all very well having ambitious targets, but they have to be based on realistic plans for achievement, and I'm not convinced WPLs bugets were based on anything much other than then end result they wanted to portray.

[neilw]

What needs to be done for the club to break even on an ongoing basis?

[Hog]

Five of us to bung in £70k each ?

[GodalmingYellow]

Five of us to bung in £70k each ?

That wouldn't work unless you did it every season.

[Hog]

Yeah, I meant every season And if five could bung in £100k every season then we'd be guaranteed promotion. Wouldn't we?

[GodalmingYellow]

What needs to be done for the club to break even on an ongoing basis?

We need to increase turnover and decrease expenditure. Sounds obvious I know, but that's what it comes down to.

We need to smash the notion that big spending equates with success. It doesn't work as we saw last season. This is the biggest issue to deal with of all.

The lessons which should have been learned are that you cannot pay £50k wages to a player in the Conference, not even on the gates we get.

Getting rid of the high earners is obviously the main way forward on expenses. 3 players on £50k equates with 5 players on £30k each. The maths is simple. Do we get nearly double the value out of a £50k player compared to a £30k player at this level? Does a Gilly ensure we concede half the goals as a Matty Day? Does a Basham score twice as many as a Yemi? I don't think so.

We need to have player contracts which reflect the success that the players bring to the club. This can be based on number of games played, number of goals scored, number of goals conceded, number of wins, which division we are in and so on. Of course there needs to be a basic wage for all players, but there needs to be significant incentive too.

We won't save much on back room staff or admin staff.

Increasing turnover is a 2 sided affair. Its a balance between pricing and volume.

It would be easy to say put up ticket prices, but that could easily have an adverse effect on sales and could result in reduced turnover. I think our standard ticket prices are probably at saturation level for the Conference.

So that means better marketing to increase sales. As we know there are many opportunities here.

Then we have to look at what additional services can the club offer supporters.

Then we look at additional sponsorship opportunities.

There's plenty that can be done.

One thought off the top of my head. Why not use away clubs as a ticket agency? Pay them 10% of the tickets they sell. It would encourage them to sell more tickets for us and encourage away fans to buy tickets in the knowledge that it would benefit their club. We get bigger gates, everyone's a winner. Can anyone think of downsides?

[Baboo]

[
Unless we have a good cup run or automatic promotion, I can easily imagine another loss close to 0.5 million this season.

How loud are these alarm bells?

For all Kassam's sins he would not allow such loses. What a pity we can't have a mix of the best of the old and new regimes.

[GodalmingYellow]

[
Unless we have a good cup run or automatic promotion, I can easily imagine another loss close to 0.5 million this season.

How loud are these alarm bells?

Depends which day you catch me on.

Seriously though, the budget losses were supposedly £250k. The club have announced they will exceed this by £100k, just as a result of reduced pre-season sales. That's £350k for starters. It takes very little for that to increase to £500k, and whilst the club have done well to maintain box sales, the very ambitious budgeted loss of £250k was based on selling a lot more.

So the alarm bells are louder than I would want.

[Mally]

What needs to be done for the club to break even on an ongoing basis?

Buy the stadium/conference centre and use it for the other 340 days a year to generate profit which can subsidise the playing side?

Its widely accepted that for the vast majority of football clubs to break even or make a profit thay have to find a way of generating revenue from non-football sources. Without owning the stadium and conference centre (which was built for this very purpose) I can't see how they can achieve it.

Success on the pitch in the shape of promotion ultimately adds cost so you end up treading water.

Selling on the product from the youth development programme is too much of a lottery - You'd need 2 Dean Whiteheads a year at least.

Cust cutting on playing staff would make us uncompetitive and cutting costs in youth development, other playing costs or non playing staff would be equally counter productive in the long run.

The longer we go on paying rent for the stadium (£400k/year inc. service cost) and stacking up debt (£130k interest/year) the worse the situation will get.

[GodalmingYellow]

What needs to be done for the club to break even on an ongoing basis?

Buy the stadium/conference centre and use it for the other 340 days a year to generate profit which can subsidise the playing side?

Its widely accepted that for the vast majority of football clubs to break even or make a profit thay have to find a way of generating revenue from non-football sources. Without owning the stadium and conference centre (which was built for this very purpose) I can't see how they can achieve it.

Success on the pitch in the shape of promotion ultimately adds cost so you end up treading water.

Selling on the product from the youth development programme is too much of a lottery - You'd need 2 Dean Whiteheads a year at least.

Cust cutting on playing staff would make us uncompetitive and cutting costs in youth development, other playing costs or non playing staff would be equally counter productive in the long run.

The longer we go on paying rent for the stadium (£400k/year inc. service cost) and stacking up debt (£130k interest/year) the worse the situation will get.

Buying the stadium at the asking price of £13m would take possibly 10 years to show a profit.

Even with just £8m in loans, StadCo runs at a large annual loss. With an additional £5m borrowing, at probably 8%, that means generating additional profit of £400k per annum over and above the losses, just to break even.

So that's close on £800k per year additional profit just to break even, taking account of eliminating existing losses. That would necessitate an increase in turnover of 2 to 3 times that currently being achieved, just to break even. That sort of improvement takes a very long time to achieve.

And then the company would have to go further still to make a profit to contribute to the club.

Whilst I agree with the concept, Kassam would need to drop his asking price by £4m to make it workable for OUFC, and I don't see that happening this side of a blue moon.

[Resurrection Ox]

What needs to be done for the club to break even on an ongoing basis?

We need to increase turnover and decrease expenditure. Sounds obvious I know, but that's what it comes down to.

We need to smash the notion that big spending equates with success. It doesn't work as we saw last season. This is the biggest issue to deal with of all.

The lessons which should have been learned are that you cannot pay £50k wages to a player in the Conference, not even on the gates we get.

Getting rid of the high earners is obviously the main way forward on expenses. 3 players on £50k equates with 5 players on £30k each. The maths is simple. Do we get nearly double the value out of a £50k player compared to a £30k player at this level? Does a Gilly ensure we concede half the goals as a Matty Day? Does a Basham score twice as many as a Yemi? I don't think so.

We need to have player contracts which reflect the success that the players bring to the club. This can be based on number of games played, number of goals scored, number of goals conceded, number of wins, which division we are in and so on. Of course there needs to be a basic wage for all players, but there needs to be significant incentive too.

We won't save much on back room staff or admin staff.

Increasing turnover is a 2 sided affair. Its a balance between pricing and volume.

It would be easy to say put up ticket prices, but that could easily have an adverse effect on sales and could result in reduced turnover. I think our standard ticket prices are probably at saturation level for the Conference.

So that means better marketing to increase sales. As we know there are many opportunities here.

Then we have to look at what additional services can the club offer supporters.

Then we look at additional sponsorship opportunities.

There's plenty that can be done.

One thought off the top of my head. Why not use away clubs as a ticket agency? Pay them 10% of the tickets they sell. It would encourage them to sell more tickets for us and encourage away fans to buy tickets in the knowledge that it would benefit their club. We get bigger gates, everyone's a winner. Can anyone think of downsides?

You can't realistically decrease costs much though can you?. Burgess has gone and that has helped re the wage bill. Top line is what needs to be added to. The club know that as well.

I have my doubts about the quality of the marketing effort sometimes though.

[GodalmingYellow]

What needs to be done for the club to break even on an ongoing basis?

We need to increase turnover and decrease expenditure. Sounds obvious I know, but that's what it comes down to.

We need to smash the notion that big spending equates with success. It doesn't work as we saw last season. This is the biggest issue to deal with of all.

The lessons which should have been learned are that you cannot pay £50k wages to a player in the Conference, not even on the gates we get.

Getting rid of the high earners is obviously the main way forward on expenses. 3 players on £50k equates with 5 players on £30k each. The maths is simple. Do we get nearly double the value out of a £50k player compared to a £30k player at this level? Does a Gilly ensure we concede half the goals as a Matty Day? Does a Basham score twice as many as a Yemi? I don't think so.

We need to have player contracts which reflect the success that the players bring to the club. This can be based on number of games played, number of goals scored, number of goals conceded, number of wins, which division we are in and so on. Of course there needs to be a basic wage for all players, but there needs to be significant incentive too.

We won't save much on back room staff or admin staff.

Increasing turnover is a 2 sided affair. Its a balance between pricing and volume.

It would be easy to say put up ticket prices, but that could easily have an adverse effect on sales and could result in reduced turnover. I think our standard ticket prices are probably at saturation level for the Conference.

So that means better marketing to increase sales. As we know there are many opportunities here.

Then we have to look at what additional services can the club offer supporters.

Then we look at additional sponsorship opportunities.

There's plenty that can be done.

One thought off the top of my head. Why not use away clubs as a ticket agency? Pay them 10% of the tickets they sell. It would encourage them to sell more tickets for us and encourage away fans to buy tickets in the knowledge that it would benefit their club. We get bigger gates, everyone's a winner. Can anyone think of downsides?

You can't realistically decrease costs much though can you?. Burgess has gone and that has helped re the wage bill. Top line is what needs to be added to. The club know that as well.

I have my doubts about the quality of the marketing effort sometimes though.

I have my doubts on the marketing too.

Burgess gone helps as you say. Hutchinson is a big earner and small contributor. Robinson likewise. Gilly likewise. Even if we could ship them out on subsidised wages it would help.

[recordmeister]

isn't this issue linked in with the previous post about the amount of money the Board of the Conference (or &quotbored of the conference&quot, as I like to call it!) have negotiated.

You would have thought that a decrease in season ticket sales (poss in some part affected by the £9.99 a month San. deal. Attractive for our 6 games pre-Xmas) etc would have been covered by a more lucrative TV deal, or have the Conf blown it and our club isn't getting as much (or the same) amount as last seasons SKY deal?

You'd hope with all the telly coverage sonsors would want to be more involved, not less.

[Baboo]

Burgess gone helps as you say. Hutchinson is a big earner and small contributor. Robinson likewise. Gilly likewise. Even if we could ship them out on subsidised wages it would help.

Getting Robinson in was a big error. His record was hardly earth shattering. As for Hutchinson, I think he has the ability to be a big contributor. But if he is on big money for this level then getting him in was also a mistake. Too many mistakes from Jim? Brevitt, Johnson .......
The advantage we should have through our financial strength (wage cap aside) has been thrown away.