Stoke show RFC how to run a Real Football Club

[Wimb]

In all honesty Dirkers, if you had to take a guess, how long is it before the bubble bursts? more to the point who is the most likely to enforce changes, the FA, UEFA, FL/PL, FIFA or the Govt?

[Snowball]

Someone on the list mentioned a book called "Moneyball" a little while ago.

It's about buying-selling wheeling/dealing in baseball but is a near-exact
analogy to RFC's dealings.


1. Search for players who are under-rated and thus under-priced.

2. Look for players with an asset and a weakness and ask can you remove the weakness (eg by changing position)

3. When bought players become subjectively "worth big bucks" sell them while their value is high.

4. Go to 1.



Oakland have done this successfully now for many years.


Interestingly, they base everything they do on quality statistics, even developing
better statistical analyses.

They also make the point that the stats-effect only works in the long-term (they play over 100 matches a year)

AND STATS GO OUT THE WINDOW IN PLAY-OFFS.

eg: there is a 20% chance that the lowest club can beat the highest in a one off game

One problem with that Snowball is that Oakland have been struggling for the past few seasons as clubs have caught up and lifted many of those methods. The A's haven't made the post season for a few years and haven't been above .500 in the last 5.

Still the theory is sound, there's also a movie version of the book coming out soon which should be a good watch

Aware of that, Wimb. It's what they did for so many years that is the point.

The fact that slowly but surely other clubs started to copy them just makes them righter.

I also liked the various asides in the book about so-called "wisdom"
in the sport which was ripped to shreds when properly examined.

And the fact that the main man wouldn't watch games live because
it influenced (in a bad way) his judgment, subjectivity and passion
distorting otherwise measurable truths.

[Svlad Cjelli]

Because they're about the only saleable asset Pompey have, and the Administrator is trying to keep the business running. Selling such assets would effectively drive them out of business - same as if a manufacturing company was forced to sell its machines.

But football finance has absolutely no logic and doesn't obey any other rules of life or law.

I thought they had been taken over, so there is no administrator there now.......[/quote]

Yea, I assumed Schards was talking about when they couldn't pay creditors, so answered about then.

[Svlad Cjelli]

In all honesty Dirkers, if you had to take a guess, how long is it before the bubble bursts? more to the point who is the most likely to enforce changes, the FA, UEFA, FL/PL, FIFA or the Govt?

Ermm, now there's a question -or two!

I'm not sure the bubble will burst as such - if it didn't with Pompey it won't now, but I'd say the bubble is slowly deflating as clubs (like Wigan) wake up and smell the coffee. More and more are realising that common sense has to prevail - if only because no-one with half a brain-cell will lend to a football club any longer (even well-run clubs are having their overdraft facilities withdrawn...)

I think there are lots of pressures coming from different directions that will help change. The UEFA Fair Play regulations will filter down on clubs that want t play in Europe, and the reform of the FA (if it happens) and the strengthening of the Owners & Directors Test (nee F&PPT) will reduce the number of rogue owners. Scrapping the Football creditors Rule will also have a profound effect on the game and its finances - as well as player contracts etc - and if football doesn't do this it's clear the government will with primary legislation.

An strengthened FA and a licensing scheme (as recommended by the DCMS enquiry) will also force change - as long a the government has got the balls to push it through - Scudamore and the PL will fight every step of the way, and get all their media buddies in on it too.

But going off on a limb I have half a feeling that a foreign-owned, debt-ridden club will come crashing down at some stage when it's discovered that there's some really dodgy dealings going on - e.g. match-fixing, money-laundering or both. Not mentioning any names, though....

[Yorkshire Royal]

I'm sure Stoke fans are sat in their droves right now thinking "I wish we were more like Reading".

Well that really isn't the point I was making. Stoke fans are like all fans, stupid. There's a decent proportion of them who wanted Pulis out at the start of last season! Admittedly they seemed to have now forgiven Peter Coates. But the subject of this thread is "Stoke show RFC how to run a Real Football Club" when the truth is more the opposite.

I'm sure Stoke fans are sat in their droves right now thinking "I wish we were more like Reading".

At least one of them is .....

But of course most aren't, because they're doing well on the back of debt. It's great while it lasts, just like it was for Portsmouth. It may all come crashing down one day - or it may not, only time will tell.

But the system currently allows this to happen - it won't always.

Not sure the relevance to Stoke here- at the end of 2009/2010 season Stoke had net debt of only 8 million pounds and the wages represent 76% of turnover. Debt wise, that's amongst the lowest and 76% is a step in the right direction. Their plan is based on keeping a tight control on wages (the real reason Carlton Cole transfer fell through), increasing turnover where they can and reducing expenditure spent on bringing in players and relying on the academy. Their academy is a long way behind even ours at this point. So they are running with debt now, but it won't be for long.

[Hoop Blah]

I will never cease to be amazed by those who criticise the RFC model.

The club's success (based on its history) has been fantastic.

The success of the last 10 years has been built on a different business model thannthe we're currently following.

Before promotion we were relatively free spending, more so to get up to the Championship than out of it, but our policy of running at break even or better is a new thing that we didn't achieve before promotion.

[Ian Royal]

I will never cease to be amazed by those who criticise the RFC model.

The club's success (based on its history) has been fantastic.

The success of the last 10 years has been built on a different business model thannthe we're currently following.

Before promotion we were relatively free spending, more so to get up to the Championship than out of it, but our policy of running at break even or better is a new thing that we didn't achieve before promotion.

TBF Madejski had money available before we got promoted. And we're operating pretty much the same way overall, just with player sales covering the loses. We can do that because we have more saleable assets these days. Who would we have got big money (£1m+) for before? Kitson, Sidwell & Shorey is about it in the 3 or four year run up to promotion. Maybe Forster, maybe Hahnemann.

I'm pretty sure we averaged about £1.5m on transfer fees each season before promotion, and we're thereabouts most seasons since. Maybe skewed by Rodgers time.

[Ian Royal]

How do we actually compare to other relegated clubs? Looking from 2000-01. From a club's first relegation in that period.

Year one: 7th out of 24. (Joint with West Ham)
- 5 of the 6 better finishers promoted straight back.
Year two: 13th out of 21. Our horror show and great recovery.
- 5 of the 12 better finishers were in the Prem, 2 of which were getting relegated straight back down. 2 teams get promoted back up. 1 relegation to League One.
Year three: 8th out of 19. (Joint with Wolves)
- 4 of the 7 better finishers were in the Prem, 2 of which were getting relegated back down. Only 1 team gets promoted back up. 2 relegations to League One.

On average Reading are 8th out of 19 for finishes over the three seasons with Man City, West Brom, West Ham, Birmingham, Sunderland, Ipswich & Leicester ahead of us. Of those Leicester went on to get relegated to League One. (If you want to go up to the full 24 who've had at least one season back you only add Newcastle to the promoted teams).

Of the 18 other teams to have had three seasons post relegation in this time 6 have gotten promotion in this time (Man City, Birmingham, West Brom, Leicester, West Ham, Sunderland & Birmingham again) (If you want to go up to the full 24 who've had at least one season back you only add Newcastle to the promoted teams). 4 of which have been relegated back to the Championship (Birmingham, Leicester, West Brom & Sunderland). 3 teams have been relegated to League One (Charlton, Bradford & Leeds). Only 3 of those teams (or 4) are still in the Prem.


There are some facts (note: not FACTS, they're real facts, not internet ones). We've unsurprisingly done better than the majority of teams relegated from the Prem in recent years. Not the best, but then a lot of far bigger clubs who'd spent longer at the top have been relegated.

[Royal Rother]

...going off on a limb I have half a feeling that a foreign-owned, debt-ridden club will come crashing down at some stage when it's discovered that there's some really dodgy dealings going on - e.g. match-fixing, money-laundering or both. Not mentioning any names, though....

I'm liking this.

[mr_number]

Haven't read through all of this since the first couple of pages, but there was an interesting snippet in the Guardian today about Ipswich, which might be vaguely relevant:

Like several other Championship clubs, Ipswich Town are cashflow insolvent. "We only survive because Marcus Evans can afford to put in £4m or £5m of his own money every year to keep the club afloat," said the chief executive, Simon Clegg. "That is testing on anyone's pockets, however deep they are."

Evans's pockets certainly are deep: the secondary-market ticket seller is worth £625m according to the Sunday Times Rich List, making him one of the 125 richest people in the country. But Ipswich fans should be forgiven for not tripping over themselves with gratitude to Evans. After all, the football-club company's debt stood at about £7.6m in June 2007, six months before Evans's takeover – about 73% of the club's turnover. Now, according to the most recent accounts, it has swelled to £40.9m – even when taking off the £11.6m owed to subsidiary companies the debt to turnover ratio of the club is a punishing 187.8%. Added to that are the £30.9m of loan notes that "following the acquisition of the company ... were assigned to Marcus Evans International Finance KFT. The interest rate on these loan notes is 7.29% per annum." That meant £1.9m of loan-note interest due to Evans was added to the total debt of Ipswich's group companies in the year to June 2010, taking it to £64m. Lucky those pockets are deep.

Which shows just how quickly things can spiral upwards...

[Royal Rother]

Ah, they might be in shite street but look at the ambition they've shown. An example to us all.

[Hoop Blah]

TBF Madejski had money available before we got promoted. And we're operating pretty much the same way overall, just with player sales covering the loses. We can do that because we have more saleable assets these days. Who would we have got big money (£1m+) for before? Kitson, Sidwell & Shorey is about it in the 3 or four year run up to promotion. Maybe Forster, maybe Hahnemann.

I think going from making significant losses per to making significant profits (or at worst breaking even as I've not seen any figures for the year 2010-11) is still quite a fundemental change in the way we run our business irrespective of how we've turned those numbers around.

Agreed we didn't have the interest in our players to sell at the right prices to cover our loses back then, but we were still happy to run at such loses and keep buying new players and renewing contracts we couldn't afford.

[Svlad Cjelli]

It could be argued that being in the PL was a disaster for us financially because what it meant was that up and coming stars didn't get a chance to increase in value, because we couldn't blood them in the first team.

It was disastrous timing for Simon Cox, for instance - no chance in the PL so he was let go for not much (in add-ons), but if we'd stayed in the Championship he'd probably have had a season or two and could well have developed into a player as valuable as Shane Long.

[Mr Angry]

It could be argued that being in the PL was a disaster for us financially because what it meant was that up and coming stars didn't get a chance to increase in value, because we couldn't blood them in the first team.

It was disastrous timing for Simon Cox, for instance - no chance in the PL so he was let go for not much (in add-ons), but if we'd stayed in the Championship he'd probably have had a season or two and could well have developed into a player as valuable as Shane Long.

If you take this to its logical conclusion then whats the point of teams like Reading ever getting to the Premiership?

The problem as I see it is that once you get to the Premeirship, the ambition of all but 5 or 6 teams is to simply stay in the Premiership, therefore more and more is spent in trying to keep that status.

Bluntly, whats the point?

I guess thats why I genuinely didn't feel too bothered about losing to Swansea.

[Super Kevin Bremner!]

Stoke signed Sonko for £2m. He made 14 appearance in 2 and a half years. He left on a free.

Stoke are clearly in safe hands.

[Svlad Cjelli]

It could be argued that being in the PL was a disaster for us financially because what it meant was that up and coming stars didn't get a chance to increase in value, because we couldn't blood them in the first team.

It was disastrous timing for Simon Cox, for instance - no chance in the PL so he was let go for not much (in add-ons), but if we'd stayed in the Championship he'd probably have had a season or two and could well have developed into a player as valuable as Shane Long.

If you take this to its logical conclusion then whats the point of teams like Reading ever getting to the Premiership?

The problem as I see it is that once you get to the Premeirship, the ambition of all but 5 or 6 teams is to simply stay in the Premiership, therefore more and more is spent in trying to keep that status.

Bluntly, whats the point?

I guess thats why I genuinely didn't feel too bothered about losing to Swansea.

Agreed - who really wants to be taking part in a competition which you will never, ever win? And where the achievement is just to get another year there - supposedly for the increased money, but as the costs go up proportionally (and more) you're no better off. And the risk of failure are literally so great that they can put your whole future in existence.

The more you analyse it the more you see that the whole of football finance is an absolute crock of shit.

[Hoop Blah]

The more you analyse it the more you see that the whole of football finance is an absolute crock of shit.

Agreed.

Unfortunately it's starting to stiffle the rest of the professional game as well because it should be the ultimate aim to get up there and compete. Realistically that's not going to happen in the current set up without a rich benefactor throwing money at a club.

Hopefully the financial fiar play rules will help bring things back under control.

[PieEater]

I think going from making significant losses per to making significant profits (or at worst breaking even as I've not seen any figures for the year 2010-11) is still quite a fundemental change in the way we run our business irrespective of how we've turned those numbers around.

I think the club has to run at a loss, if it were to make a profit then any cash left over would soon get eaten up in more lucrative player's contracts. As it is now we can honestly say to players that we can't afford any more cash. It's the only way to keep players wages under control.

[Hoop Blah]

We've run at a profit for the last 3 or 4 years though....

[PieEater]

We've run at a profit for the last 3 or 4 years though....

You obviously haven't been reading the finance threads.