Stadium renaming.

[Nameless]

Other than the team, there's little more tied to a club's identity than their stadium. Sponsorship is sort of grudgingly accepted, but a poor name really does sound naff and desparate. If the sponsor name is a single word it doesn't sound too bad, but more than that often sounds clunky.

You do have to wonder why some companies bother though, as most people will continue to refer to grounds by their original name.

Overall though, this is probably just replacing the money lost due to London Irish leaving.

We aren't changing the stadium though. When we did change the stadium we gave it a name that recognised someone who had put quite a lot of money into the club. The new name does the same. It will be interesting to see whether they have put the full 10 year sponsorship up front. Would make a lot of sense if they did - £7-8 million straight into the accounts now plus the Olise money is significant....

It doesn't work like that though, the income would be spread accross the period to which it relates, therefore only 10% of the received revenue will hit our books in the next year, even if we have recieved all the cash up front.

Really ? So when the ground was sold the income from that is spread across the lifetime of the stadium rather than in a single hit ?
I genuinely don’t know but would it not be possible to do these things in a variety of ways ? Sell the naming rights for ten years @ x per year, or sell the naming rights for 10x ?

[Snowflake Royal]

We aren't changing the stadium though. When we did change the stadium we gave it a name that recognised someone who had put quite a lot of money into the club. The new name does the same. It will be interesting to see whether they have put the full 10 year sponsorship up front. Would make a lot of sense if they did - £7-8 million straight into the accounts now plus the Olise money is significant....

It doesn't work like that though, the income would be spread accross the period to which it relates, therefore only 10% of the received revenue will hit our books in the next year, even if we have recieved all the cash up front.

Really ? So when the ground was sold the income from that is spread across the lifetime of the stadium rather than in a single hit ?
I genuinely don’t know but would it not be possible to do these things in a variety of ways ? Sell the naming rights for ten years @ x per year, or sell the naming rights for 10x ?

Selling a stadium is a one off deal where it changes hands at a particular point in time. So it's pretty easy for that to be a single injection of cash.

A ten year naming rights deal is a thing over ten years. So the revenue from it wouldn't be frontloaded all at once and then nothing. It'd be spread over the life of the deal.

[Nameless]

It doesn't work like that though, the income would be spread accross the period to which it relates, therefore only 10% of the received revenue will hit our books in the next year, even if we have recieved all the cash up front.

Really ? So when the ground was sold the income from that is spread across the lifetime of the stadium rather than in a single hit ?
I genuinely don’t know but would it not be possible to do these things in a variety of ways ? Sell the naming rights for ten years @ x per year, or sell the naming rights for 10x ?

Selling a stadium is a one off deal where it changes hands at a particular point in time. So it's pretty easy for that to be a single injection of cash.

A ten year naming rights deal is a thing over ten years. So the revenue from it wouldn't be frontloaded all at once and then nothing. It'd be spread over the life of the deal.

Would be interesting to hear how someone with practical/technical knowledge sees it. Is there a legal reason why I could not sell you the right to use something for 10 years for £1 million up front ? Could I sell you the right to use it for 1 year for a million and then give you 9 years for nothing ? It is way more beneficial for us to get the revenue now and hard to see why we coukdn’t Do that (of course the sponsors may prefer to spread their payment out)

[Snowflake Royal]

Really ? So when the ground was sold the income from that is spread across the lifetime of the stadium rather than in a single hit ?
I genuinely don’t know but would it not be possible to do these things in a variety of ways ? Sell the naming rights for ten years @ x per year, or sell the naming rights for 10x ?

Selling a stadium is a one off deal where it changes hands at a particular point in time. So it's pretty easy for that to be a single injection of cash.

A ten year naming rights deal is a thing over ten years. So the revenue from it wouldn't be frontloaded all at once and then nothing. It'd be spread over the life of the deal.

Would be interesting to hear how someone with practical/technical knowledge sees it. Is there a legal reason why I could not sell you the right to use something for 10 years for £1 million up front ? Could I sell you the right to use it for 1 year for a million and then give you 9 years for nothing ? It is way more beneficial for us to get the revenue now and hard to see why we coukdn’t Do that (of course the sponsors may prefer to spread their payment out)

Presume it's much the same as player fees. Where the value of the transfer goes in the books across the duration of the contract regardlesss of whether money was handed over upfront or not.

Putting it all in year one is just robbing Peter to pay Paul anyway.

[muirinho]

Really ? So when the ground was sold the income from that is spread across the lifetime of the stadium rather than in a single hit ?
I genuinely don’t know but would it not be possible to do these things in a variety of ways ? Sell the naming rights for ten years @ x per year, or sell the naming rights for 10x ?

Selling a stadium is a one off deal where it changes hands at a particular point in time. So it's pretty easy for that to be a single injection of cash.

A ten year naming rights deal is a thing over ten years. So the revenue from it wouldn't be frontloaded all at once and then nothing. It'd be spread over the life of the deal.

Would be interesting to hear how someone with practical/technical knowledge sees it. Is there a legal reason why I could not sell you the right to use something for 10 years for £1 million up front ? Could I sell you the right to use it for 1 year for a million and then give you 9 years for nothing ? It is way more beneficial for us to get the revenue now and hard to see why we coukdn’t Do that (of course the sponsors may prefer to spread their payment out)

Whether the sponsors are happy to hand over all the money up front is irrelevant, we need the money for FFP purposes, not because of cash flow difficulties. And there's no way FFP would regard a 10 year deal as a pay all in year one deal. Even if we get all the money up front, for FFP purposes it will be spread over the length of the contract.

[Nameless]

Selling a stadium is a one off deal where it changes hands at a particular point in time. So it's pretty easy for that to be a single injection of cash.

A ten year naming rights deal is a thing over ten years. So the revenue from it wouldn't be frontloaded all at once and then nothing. It'd be spread over the life of the deal.

Would be interesting to hear how someone with practical/technical knowledge sees it. Is there a legal reason why I could not sell you the right to use something for 10 years for £1 million up front ? Could I sell you the right to use it for 1 year for a million and then give you 9 years for nothing ? It is way more beneficial for us to get the revenue now and hard to see why we coukdn’t Do that (of course the sponsors may prefer to spread their payment out)

Presume it's much the same as player fees. Where the value of the transfer goes in the books across the duration of the contract regardlesss of whether money was handed over upfront or not.

Putting it all in year one is just robbing Peter to pay Paul anyway.

It isn't though.
We need to get our Sustainability position sorted now. there is much greater value in getting the money in one hit than spreading it over 10 years.
And it's the opposite of player fees where you are talking about spending money. You don't spreading income from transfers across whatever duration contract a player signs elsewhere. are you not confusing the writing off of the value of the player over the contract duration when you buy a player ?

[Nameless]

Selling a stadium is a one off deal where it changes hands at a particular point in time. So it's pretty easy for that to be a single injection of cash.

A ten year naming rights deal is a thing over ten years. So the revenue from it wouldn't be frontloaded all at once and then nothing. It'd be spread over the life of the deal.

Would be interesting to hear how someone with practical/technical knowledge sees it. Is there a legal reason why I could not sell you the right to use something for 10 years for £1 million up front ? Could I sell you the right to use it for 1 year for a million and then give you 9 years for nothing ? It is way more beneficial for us to get the revenue now and hard to see why we coukdn’t Do that (of course the sponsors may prefer to spread their payment out)

Whether the sponsors are happy to hand over all the money up front is irrelevant, we need the money for FFP purposes, not because of cash flow difficulties. And there's no way FFP would regard a 10 year deal as a pay all in year one deal. Even if we get all the money up front, for FFP purposes it will be spread over the length of the contract.

I'm just speculating on possibilities. If anyone knows rather than just speculate the opposite then it would be good ! I have no idea whether it's a general accounting law thing or a Sustainability rule but accountants are usually quite creative and it would undoubtably be a significant benefit if the payment was front loaded. Something simple like selling the rights for £9 million with annual extensions for £100k/ year ?
I guess we'll not know how it was done until the accounts are published.

[Snowflake Royal]

LOL at thinking we're getting anything like £10m over 10 years.

[Nameless]

LOL at thinking we're getting anything like £10m over 10 years.

I'd be happy for you to replace my purely figurative amount with an accurate one. if you can.....
It's as likely amount as any really.

[Snowflake Royal]

LOL at thinking we're getting anything like £10m over 10 years.

I'd be happy for you to replace my purely figurative amount with an accurate one. if you can.....
It's as likely amount as any really.

The equivalent of £1m a year from a company already sponsoring the shirt that only has an annual turnover of about £40m? In other words it's giving away over 2% of turnover?

There was a recent lower PL club deal that was supposed to be about £200k a year.

You're in cloud cuckoo land if you think it's realistically more than a max of £300k a year.

Probably something like £150k

[Harpers So Solid Crew]

Apparantley Middlesbrough have already played there. And on their last visit won 2-0, good old local media

[Wycombe Royal]

Really ? So when the ground was sold the income from that is spread across the lifetime of the stadium rather than in a single hit ?
I genuinely don’t know but would it not be possible to do these things in a variety of ways ? Sell the naming rights for ten years @ x per year, or sell the naming rights for 10x ?

Selling a stadium is a one off deal where it changes hands at a particular point in time. So it's pretty easy for that to be a single injection of cash.

A ten year naming rights deal is a thing over ten years. So the revenue from it wouldn't be frontloaded all at once and then nothing. It'd be spread over the life of the deal.

Would be interesting to hear how someone with practical/technical knowledge sees it. Is there a legal reason why I could not sell you the right to use something for 10 years for £1 million up front ? Could I sell you the right to use it for 1 year for a million and then give you 9 years for nothing ? It is way more beneficial for us to get the revenue now and hard to see why we coukdn’t Do that (of course the sponsors may prefer to spread their payment out)

Well, I guess me being a CIMA Accountant and a Finance Director might qualify me to provide that knowledge......

[Chairman Mao]

LOL at thinking we're getting anything like £10m over 10 years.

I'd be happy for you to replace my purely figurative amount with an accurate one. if you can.....
It's as likely amount as any really.

The equivalent of £1m a year from a company already sponsoring the shirt that only has an annual turnover of about £40m? In other words it's giving away over 2% of turnover?

There was a recent lower PL club deal that was supposed to be about £200k a year.

You're in cloud cuckoo land if you think it's realistically more than a max of £300k a year.

Probably something like £150k

probably more like 50k
and we would be lucky to get that tbh

[Esteban]

I'd be happy for you to replace my purely figurative amount with an accurate one. if you can.....
It's as likely amount as any really.

The equivalent of £1m a year from a company already sponsoring the shirt that only has an annual turnover of about £40m? In other words it's giving away over 2% of turnover?

There was a recent lower PL club deal that was supposed to be about £200k a year.

You're in cloud cuckoo land if you think it's realistically more than a max of £300k a year.

Probably something like £150k

probably more like 50k
and we would be lucky to get that tbh

That might be true for most companies, but these are lifelong Reading fans. Obviously they will have their limit, but the amount they choose to invest could well be higher than we would have got from most other sponsors.

[Coppells Lost Coat]

Surely it depends on how the sponsors want to advertise - they may see it as a more cost effect than putting in a page spread in a selection of papers - that no one reads.
As i said previously - the brand will be plastered everywhere on various platforms. Match reports, local news reports, highlight reels and the huge name written on the side of the stadium - thats on a pretty bust road. Post match interviews with the sponsor behind the player has already happened a few times.
Surely that equates to £100k+ on adverts

[Hendo]

I guess there would be clauses in the contract for promotion/playoffs as well, which could bump it up (and the other way for relegation, no doubt).

Also wondering whether there might be performance related bonuses from their side as well. They lease x amount of cars since the naming deal and Reading get a bonus.

[RG30]

First time I've seen a figure quoted anywhere but The Athletic reporting the stadium naming rights were sold for £1million a year on a 10-year deal.

[Horsham Royal]

First time I've seen a figure quoted anywhere but The Athletic reporting the stadium naming rights were sold for £1million a year on a 10-year deal.

SCL profits for last 3 years have been ~4M on <20M turnover.
Bunging 1M a year at RFC seems either remarkably generous or remarkably unsustainable.
1M over 10 years seems more likely.

[RG30]

I stand corrected

Quiz time! First question: what is the new name of Reading’s home ground, the Madejski Stadium?

Second question: to the nearest five per cent, how many fans still call it the Madejski Stadium?

Sorry, that is unfair on Reading as it is not their fault 95 per cent of fans will still be calling their home ground the Madejski, or “the Mad Stad”, in 2031, the year local firm Select Car Leasing’s £1 million, 10-year naming-rights deal expires.

[Elm Park Kid]

First time I've seen a figure quoted anywhere but The Athletic reporting the stadium naming rights were sold for £1million a year on a 10-year deal.

SCL profits for last 3 years have been ~4M on <20M turnover.
Bunging 1M a year at RFC seems either remarkably generous or remarkably unsustainable.
1M over 10 years seems more likely.

Expect to see their profits increase in next year's account when some mysterious, wealthy clients starts paying £1m a year to lease some fancy cars, whose paperwork can never be found.