Hand To Mouth: Harsh Realities For Football League Clubs In 2013

By on Mar 15, 2013 in Finance, Latest | 6 comments

As the giants of the European game strutted on the pan-continental stage that is the Champions League this week, the lower divisions in England were inadvertently further highlighting the issue faced when smaller clubs have to go head to head with a now constant stream of live, televised football. While millions watched at home as Barcelona over came their two goal deficit against Milan with near predictable ease, there were also thousands of people out supporting teams in the altogether less glamorous atmosphere of the Football League and Blue Square Bet Premier. There is, as we have mentioned on this site before, plenty to talk about in these divisions, but on a bitterly cold Tuesday evening it was, perhaps, not that surprising that crowd figures were extremely disappointing. In League One, just 3,587 people (against a home average attendance this season of 5,550) turned out to watch Notts County get beaten at home by Preston North End, whilst in League Two there were four matches attended by less than 1,600 people, including a crowd of just 1,227 (down from a season average of 1,829) for the match between Dagenham & Redbridge and Torquay United.

Of course, the easy thing to do at this point would be to start throwing accusations about the Champions League “killing lower division football” or some such, but to do so would be somewhat simplistic. After all, the Champions League has been going in ts current form – or variants thereupon – for just over two decades now, and while there is an element of showboating about UEFA’s decision to spread each leg of its round of sixteen over two weeks (presumably for the benefit of broadcasters), to make the assumption that thousands of supporters of lower division clubs simply preferred to stay in and watch two of Europe’s best clubs play on the television is unprovable, at best. It is also worth pointing out that there is a tendency for crowds to fall away a little in the lower divisions at this time of year, especially at clubs at which there may be little to play for. The aforementioned Notts County, for example, are in eleventh place in the League One table, nine points from the play-off places. They won’t be relegated this season, this much we know already, but the likelihood of their club making the play-off positions at the end of this season also remains slim. With little to play for but an outside chance of extending their season and pride, the weather dismal and a live match on Free-To-Air television, flat-lining attendances start to make a little more sense.

There have been hints that all is not right in the lower divisions coming through on a drip, drip, drip basis over the last few weeks, and this hasn’t limited to the exceptional circumstances at Coventry City or Portsmouth, either. Last week, the Bury manager Kevin Blackwell spoke out against those that have criticised his team in League One as overpaid, saying that, “there was a lot of players here getting paid nothing and then some are paid £100 and £200 a week.” Meanwhile, Accrington Stanley, whose attendances in League Two have long been amongst the lowest in the entire Football League, confirmed this week that they had been unable to pay some of their players for the start of March. With admirable clarity, the club’s managing director said that, “It’s not acceptable, we’re not making excuses, and it’s credit to Lee and the players that they haven’t used it as an excuse for results not going our way,” and added, with a comment which addresses the very modern and very real fears of the supporters of all clubs in the lower divisions, that, “We’re full up to date with HMRC and our usual creditors,” a point which acknowledged the ruthlessness of the taxman in ensuring that its share of the income of all football clubs is paid in full and on time.

These problems and fears were ably demonstrated last week by the results of a survey of clubs that was conducted for the BBC to mark the return of its “Late Kick Off” television programme. Forty-one out of the seventy-two member clubs of the Football League completed the survey – it may even be significant that thirty-one of the clubs didn’t even bother responding to it – and the answers that the BBC got didn’t make for particularly happy reading. One club chief executive told the survey that 75% of clubs were experiencing a decline in attendances in comparison with last season, and the managing director of a League One club said gates in his club’s division were down 15%, with an average fall across the leagues of between 4 and 5%. Overall, seventy per cent of respondents – twenty-nine out of forty-one – stated that they were “concerned” about their financial position, with falling attendances, wages and agents fees being cited as being amongst the biggest cause of those concerns.

The clubs are more dependent on gate money to survive than those in the Premier League is a given. The current television contract, which kicked in at the start of the season, is worth more than a quarter less than the one that preceded it, while the Football League’s sponsor Npower is not renewing its contract from the start of next season, meaning that a new sponsor for the league will have to be found on the eve of its one hundred and twenty-fifth birthday. It is these financial pressures, when coupled with – broadly speaking, as Kevin Blackwell’s example above demonstrates – continuing wage inflation which seem to be at the heart of this problem, and even though Premier League television money is set to dramatically increase from the start of next season, there has been no indication yet that the solidarity payments made to the Football League by the top division will increase as well. Many supporters argue that ticket prices are too high, but clubs can only counter this by saying that they are this way for a a reason, and that this reason simply doesn’t exist in the Premier League. It is highly likely that they simply cannot afford to reduce them. And all of this is without taking into account the increase in the gap between the haves and have nots, which will come about from the start of next season when the new Premier League television deal kicks in.

The temptation to continue to do so in order to keep up will, however, remain a strong one, even though, under Football League rules, League One clubs are now only permitted to spend a maximum of 65% of their annual turnover on wages (a figure which will drop to 60% from the start of next season), with the cap at 55% in League Two. It might be considered that, considering the fall in revenues that clubs have witnessed this season, the Football League acted just in time in expanding these rules in order to save clubs from themselves. Still, though, the intractable nature of the problems that the clubs of the lower divisions face remains a cause for concern. One of English football’s greatest strengths is its strength in depth and clubs must continue to be encouraged to live within their means in order to ensure that this strength in depth remains in place. However, without any guarantees of lavish sponsorship or television money – although the Football League does seem to be quietly optimistic that renewed competition in the television market brought about by BT’s entry into that particular market may increase television revenues again in the near future – clubs will continue, for the time being at least, to be dependent upon people actually turning out to watch them if they are to come anywhere near to thriving, and as Tuesday night’s attendance figures demonstrated, that can prove difficult to achieve if the weather is inclement and there is an alternative on the television. With its one hundred and twenty-fifth birthday looming and seven of its members being amongst the original twelve which started it all that time ago, it seems likely that the Football League and its clubs will have to continue to fight against the grain to keep everybody afloat.

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    6 Comments

  1. Notts were charging £24 for away fans against Preston on Tuesday. I have a friend who is a PNE fan, and he was going, but no way would I pay that as a neutral.

    Clubs are pricing themselves towards low attendances, and Notts are one. Do they not realise that people are finding times hard out there? Do they watch the news at all?

    The FL needs to help by anticipating when CL fixtures will be televised on ITV and arrange their fixtures to avoid the kock-out rounds, if possible, and also to encourage clubs to play on Wednesday nights rather than Tuesdays. Maybe end the season a week later – get more Saturday fixtures and fewer winter midweeks when it is cold?

    I’m not a marketing man, but do the FL employ one? If they do, he’s not doing a great job of promoting the FL or its member clubs.

    Dean

    March 15, 2013

  2. Good article, but I think you mean Preston in para 1, rather than Shrewsbury?

    BigAl

    March 15, 2013

  3. Quite right, Al. Read the line wrong on the results page in my hurry to get it tied up before work this morning. Have amended it. Cheers for pointing it out.

    Ian

    March 16, 2013

  4. League Two has been in trouble for a while now. Since 2004/05 average attendances have been trending downwards – whereas in the other divisions attendances (and the Conference) they have merely been flat-lining

    See this graph I knocked-up a while back: http://rowzfootball.files.wordpress.com/2012/10/index1.jpg

    If it carries on into the not too distant future there is a major question mark over it’s viability.

    Strangely I think the solution is to promote 3 from the Conference – at least for the next few seasons. League Two will only be better off having stronger sides like Luton, Grimsby, Wrexham and Stockport in the division in exchange for some of the weaker clubs.

    Row Z

    March 16, 2013

  5. Here’s my current thinking for what its worth:

    I’m a season ticket holder at Doncaster Rovers and have been for 30 years. I no longer attend away games due to the cost of travel and tickets. I am becoming completely uninterested in all European games, never bother to watch a europa league match and only bother with the champions league final. Even premier league games usually leave me cold. Any televised match really has to grab my interest if I am going to watch it all the way through.

    Me and a fellow DRFC season ticket holder have begun watching non-league football from NCEL up to conference north. Its cheap, played in a proper spirit and with a proper “football family” feel – if that makes sense.

    Many years ago we would have either gone to DRFC away matches or to a local footbal league game. The changes stopping this are in no particular order of importance and just the ones I can think of:

    1. Cost of tickets
    2. The faffing around to obtain a match ticket instead of pay on the gate.
    3. All seater stadia
    4. Lack of atmosphere (does anyone else find the atmosphere at many grounds tends toward the negative these day ie in effect more booing than cheering)
    5. Over-zealous stewarding

    What it boils down to is this; the non-league day out is far closer to my personal historical familiarity with football than much of what is offered at league grounds these days. I must be getting old.

    Beerseller

    March 17, 2013

  6. Good to see an accurate, and thoughtful, article about this problem. Couple of points:

    Some of the clubs, and Leyton Orient is one, are suffering from undeniable demographic changes in the areas which traditionally provided their support. East London has a significant immigrant population, black and white and from all over the world from South Africa through Asia and Eastern Europe. The club finds it difficult to connect with this potential fan base – despite special offers, adverts in the relevant newspapers etc. Kids from the community are taking a full part in the community schemes the club’s community programme runs, but its not easy to translate attendance at Saturday morning football school into attendance at a home game. At the same time, our traditional fan base is moving out to Essex, Kent and to the north east of London, which makes travel to home games more difficult and more expensive. If Orient are to survive – particularly now it seems inevitable that West Ham will, eventually, move into the Olympic Stadium – then we need to find new and effective ways to attract fans from the local community. If we can’t do that, then the only real alternatives are to fade into history, or move.

    On the question of the pay cap, I am torn. It seems to be an appropriate way to keep clubs on the straight and narrow, but should it be based, as I understand it is, solely on revenue. It seems to me that going down this route means we are, in effect, encouraging clubs to maximise revenue income which, as you point out, means there’s a need to maximise gate revenue at this level. Maybe there’s a better way?

    Tony Roome

    March 18, 2013

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