Generic clubs in financial crisis Thread

[Dirk Gently]

Why not just allow Darwinian principles to work and let the clubs go bust

New clubs will eventually rise to replace the old over the next 20 years or so

Keeping the clubs alive does not improve the "Meme pool"

There would probably be about 10 or 12 new clubs in the top four divisions if this happened - about half a division of new talent/faces

The problem is that once a club goes bust, that's usually it. If Reading went bust that would be the end of professional football in Reading forever, unless some rich tycoon with more money than sense built a new stadium and created a new club.

A "Darwinian" world would see about half of the clubs in the country die out, if not more, and few of those would go bust because they are competing in a congested market. Any one of Reading, Oxford, Aldershot, Swindon or Wycombe could fold, for example, and none of the others would pick up any noticeable support as a result.

Indeed, plus the football clubs are interdependent and they know and acknowledge it. They need other clubs to play, they need other clubs to develop payers, they need other clubs to stimulate interest in the game and so on ..... Why else would the PL TV deal be a shared one, where Man Utd and Liverpool etc (who could command massive fees for their own TV contracts) are happy to take part in shared negotiations and split the money (not a perfect split but they'd definitely do better negotiating alone.)

It's not like any other industry where it's only good news when a competitor goes bust. Not in football - where it's the whole structure that counts and is the strength - weaken that and you really weaken everyone. Yes, you could lose a few clubs and maybe the game would survive, but maybe not - if nothing else financial confidence would collapse and that'd impact everyone.

[PieEater]

After reading the stuff about Watford, it sounds like Squeaky was having the last laugh probably aware of Watfords position during the Tommy Smith saga, and now a double snigger as they've not even been paid from Pompey.

[Harpers So Solid Crew]

I disagree here, so long as there are enough clubs then football will continue, I believe that there are too many clubs harbouring lofty ambitions, I can see England managing to support about 60 decent clubs maximum. The top four barely need the rest of the clubs in this country, a European league would do them, like the champions league.

TBH you only have to look at the top clubs across Europe, much the same names as when i was a child, and that was a long time ago.

[Terminal Boardom]

http://news.bbc.co.uk/sport1/hi/football/eng_conf/8402159.stm

Unibond League side King's Lynn wound up by High Court

King's Lynn have gone out of business after they were wound up in the High Court in London on Wednesday.

The Unibond Premier Division side, who were formed in 1879, had mounting debts and a near-£70,000 tax bill.

A potential investor allegedly pulled out of a deal to save the club late last week, leaving chairman Ken Bobbins not enough time to find an alternative.

The Linnets were sixth and their last game was a 2-1 defeat by Retford United in the league cup on 24 November.

Player-manager Carl Heggs revealed last week that all the club's staff bar himself and local-based goalkeepers Danny Gay and Ally McAnally had left for other clubs.

Earlier this week, Bobbins confirmed that an anonymous individual had been in talks regarding a takeover, but the Football Association's ownership regulations got in the way.

What a sorry state of affairs when the people of a town can not rally round, find £70,000 between everyone, and save the football club.

[Rev Algenon Stickleback H]

I disagree here, so long as there are enough clubs then football will continue, I believe that there are too many clubs harbouring lofty ambitions, I can see England managing to support about 60 decent clubs maximum.

Your assumption is that the ones that go bust would be the 30 smallest clubs. There's no reason to believe that would be the case. Very few clubs get into trouble because they lack support. King's Lynn, for example, were one of the better supported clubs outside the league. The just got stitched up by the conference, relegating them for not having a ground up to standard on a technicality, despite having one of the best grounds outside the league.

Besides, I've never understood the idea that the game would somehow be stronger if the natural 4th tier clubs weren't there. As I said before, if Wycombe or Aldershot go bust, how is the game better off?

And both are quite capable of supporting professional football. People talk about it as if there just aren't enough fans to go round. The depth of support in this country is envied around the world.

[Dirk Gently]

I disagree here, so long as there are enough clubs then football will continue, I believe that there are too many clubs harbouring lofty ambitions, I can see England managing to support about 60 decent clubs maximum.

Your assumption is that the ones that go bust would be the 30 smallest clubs. There's no reason to believe that would be the case. Very few clubs get into trouble because they lack support. King's Lynn, for example, were one of the better supported clubs outside the league. The just got stitched up by the conference, relegating them for not having a ground up to standard on a technicality, despite having one of the best grounds outside the league.

Besides, I've never understood the idea that the game would somehow be stronger if the natural 4th tier clubs weren't there. As I said before, if Wycombe or Aldershot go bust, how is the game better off?

And both are quite capable of supporting professional football. People talk about it as if there just aren't enough fans to go round. The depth of support in this country is envied around the world.

Exactly - it's "living the dream" and the unrealistic expectations of people throughout football - and the lack of governance - that allows clubs to spend completely unrealistically. The whole financial culture needs to change.

But it worked in Germany - it can be done here too. The tide is starting to turn - even 5 years ago hardly anyone cared who owned clubs, how they were run or whether they were in debt. Now more and more people are aware.

[Jerry St Clair]

Anyway, Chester's game against Fleetwood on Saturday has been moved to Friday on police advice. The local constabulary have also demanded that they take control of crowd safety for the game (normally the chief steward is responsible) based on intelligence which indicates further demos.

[Dirk Gently]

Anyway, Chester's game against Fleetwood on Saturday has been moved to Friday on police advice. The local constabulary have also demanded that they take control of crowd safety for the game (normally the chief steward is responsible) based on intelligence which indicates further demos.

As far as Chester fans are concerned their club is dead - it's being artificiallykept alive because of the lack of balls of the Conference to do deal with the owner - some of whose actios are unbelieveable even by the stanards set by football club chairmen.

A good - but depressing read .... http://chestercityfc.wordpress.com/2009/12/03/chester-city-the-death-rattle-part-7/

......
The football authorities have repeatedly had the chance to nip this in the bud for the good of the game, and they have bottled it. This isn’t said with any great pleasure or relish. We don’t just want or wish for strong authorities within the game to make tough decisions – we need them to. When they say that “we are hopeful those who have supported the club through such difficult times, especially the fans on the terraces, appreciate the position we as a competition faced in dealing with this situation”, they prove that they are fundamentally missing the point of the entire argument. Why do these people think that supporters are boycotting the club? Why do they think that some are risking football banning orders to protest during matches? Do they think that normal, rational people are behaving like this for the sheer hell of it? If they do they are idiots, and it is difficult to reach any other conclusions than that they do.

Chester, then, will limp on. They are still twenty-four points off safety in the Blue Square Premier and relegation seems likely. The protests will continue and judging by the mood amongst the club’s supporters this evening, they will get bigger and bigger. And it is they that will be blamed for the scale of these protests. The ultimate blame for them, though, will lie with the feeble and inept infrastructure that administrates the game in this country. Ten years ago, they allowed Vaughan to sell one of the two clubs that he (against FA rules at the time) owned at the time to his painter and decorator a couple of days before they met in the FA Cup, only to buy one of them back just after the match had been played. They allowed him to try and put through a CVA that was challenged by HMRC and was thrown out by a judge for having “material irregularities”. They have maintained a stony silence over this admission of carousel fraud and don’t seem in the slightest bit interest in who he ends up “selling” his shares to when he, by law, has to.

When the protests end, a large group of people will walk away from Chester City Football Club. The crowds at The Deva Stadium will continue to plummet. The FA don’t seem to support them. The Football League don’t support them. The Football Conference don’t seem to support them. The Football Conference’s statement doesn’t stop short of saying to protesters, “Yeah, well, you wouldn’t understand”. It’s little short of insulting, to their intelligence and their dignity, and it’s insulting to our intelligence and our dignity. Moreover, it’s killing football in Chester. When Chester City won the Football Conference in 2004, the average home crowd was 3,065. It’s down to 1,285 this season, and it’s likely to drop still further. Is this what they want? Almost two housand people that can’t be bothered with their local club any more in the space of six years?
.....

[rhroyal]

I disagree here, so long as there are enough clubs then football will continue, I believe that there are too many clubs harbouring lofty ambitions, I can see England managing to support about 60 decent clubs maximum.

Your assumption is that the ones that go bust would be the 30 smallest clubs. There's no reason to believe that would be the case. Very few clubs get into trouble because they lack support. King's Lynn, for example, were one of the better supported clubs outside the league. The just got stitched up by the conference, relegating them for not having a ground up to standard on a technicality, despite having one of the best grounds outside the league.

Besides, I've never understood the idea that the game would somehow be stronger if the natural 4th tier clubs weren't there. As I said before, if Wycombe or Aldershot go bust, how is the game better off?

And both are quite capable of supporting professional football. People talk about it as if there just aren't enough fans to go round. The depth of support in this country is envied around the world.

It would take a generation to recover. If we hypothetically go bust I can't see myself picking up another team. I'd probably have to wait until I've got kids and start taking them to local matches.

[Tredder]

Notts County owners stick the club up for sale already, conference football awaits.

[Tony Le Mesmer]

Portsmouth deny they are about to go into administration

[Jerry St Clair]

Dirk, what's the history of the Chester debacle? Why are Vaughan (or his son) continuing to refuse to pay football debts? What's in it for them? Do they own the Deva?

[Dirk Gently]

Dirk, what's the history of the Chester debacle? Why are Vaughan (or his son) continuing to refuse to pay football debts? What's in it for them? Do they own the Deva?

This is just one of the extracts that sums him up :

The man that sold his shares in Barrow for a nominal fee when the club played Vaughan’s Chester in the FA Cup to a painter and decorator, only to buy them back a couple of days after the match was played. The man that held a minute’s silence at The Deva Stadium for Colin Smith, a gangster shot dead outside a Liverpool gymnasium in 2007. The man that either did or didn’t pay £11,000 per week for “cleaning services” earlier this year. The man that signed the club over to his son at the end of April without making it public. The man that attempted a CVA with himself as the biggest creditor and saw an appeal against it upheld in court.

I think he does it simply because he can - he loves finding loopholes and stringing people along, and as a creditor he stands to gain a certain amount when the crash comes (who do you think the £11k a week for "cleaning services" was paid to?)

All the while he's making what money he can out of it and getting away with it.

But the good news is that the Deva is council owned - I think most Chester supporters are now just waiting and hoping for CCFC to be wound up so an "AFC Chester" or equivalent can be created.

[Jerry St Clair]

So, just a bit of a wide boy then.

Is there a covenant on the Deva that ensure it will continue to be used for football matches? Are the local council generally supportive of football in the city?

[Rev Algenon Stickleback H]

I think covenants really only come into play when someone is looking to sell the site for financial gain, which is unlikely to be the case at Chester (although it's equally unlikely that one exists as it's a relatively new site, rather than one given to the club on the condition that it's only used for sport).

Not owning a ground is great for clubs that do fold, like Aldershot, as the new club has a ground to play in, rather than having to start from scratch. It is bad on the other hand in that with no large asset to secure debts against, banks are far more likely to call in debts.

[Dirk Gently]

Agree with all of that - a ground is a tangible asset which makes a club much more likely to be asset-stripped (q.v. Brighton, York, Wrexham etc), and often the earliest warning of troble is when an owner separates the ownership of club and ground (as Scalley has recently done at Gillingham).

[Terminal Boardom]

So, just a bit of a wide boy then.

Is there a covenant on the Deva that ensure it will continue to be used for football matches? Are the local council generally supportive of football in the city?

I don't recall the council being too supportive when Sealand Road was sold effectively to Morrissons. What followed was the disasterous groundshare at Macclesfield.

[Dirk Gently]

Good article on football finances by the Newcastle Trust

[DrZoidberg]

A good read. I predict the same old dodgy goings on for years to come unless we have a seriously high profile casualty in terms of a club folding. The demise of a Portsmouth would not be noticed by the industry that is football. Sure the fans would notice but I doubt it would bring about proper changes in regulation. Notts County, Watford and teams of that stature as mentioned in the article would not even create a ripple.

[Super_horns]

Plymouth have been hit with a transfer embargo...over unpaid debts.

We have an AGM tonight which could make or break the club.

Hoping for some positive news but the major shareholders don't get on at all which is worrying (our former chairman got kicked off by the Russos last year and rumours are he might be back for some kind of "revenge")