BusinessCompany NewsFuture looks tough for Football League clubs

Future looks tough for Football League clubs

While Premier League clubs look certain to dominate the European stage in terms of revenue, profits and playing talent, clubs in the lower divisions are set to struggle financially, a survey by Deloitte & Touche says.

Link: Premiership club to collapse soon

In its Annual Review of Football Finance the firm said the 2001/2002 season had been a ‘watershed’ year for transfer spending, with £407m spent on players, and the game was unlikely to see another year like it again.

Indeed, 2002/2003 transfer spending is estimated to fall by about £150m while the January 2003 transfer window saw only £20m to £25m change hands.

As an example Tottenham Hotspur recently signed Bobby Zamora from the second division for just £1.5m, when he had in the past been valued at about £4m.

And, Deloitte & Touche said, Football League clubs faced a difficult period of adjustment due to reduced broadcasting revenues this year and in the future.

Paul Rawnsley, Deloitte’s senior sports business consultant, said clubs needed to reassess their goals and purpose. ‘For all clubs, an annual balanced cash budget of income and outgoings is essential,’ he said.

‘For most, that means setting realistic ambitions to ensure clubs are preserved for the community and future generations. In many cases, Supporters Trusts may have a key role to play, particularly in rescuing clubs from trouble and ensuring financial problems do not recur.’

Premier League clubs, though, should be the biggest winners – they already account for 25% of the estimated €7.1bn (£5bn) European football industry. The big five – England, Italy, Spain, Germany and France – account for 80% of all revenues. Overall, including the UEFA Champions League, the total market is valued at &euro:10bn (£7bn).

Total revenues in the Premier League rose to £1.132bn in 2001/2002 and are expected to grow to £1.25bn when all revenues are added up for the 2002/2003 season.

Football League turnover grew to £467m in 2001/2002, an increase of £135m or 41%.

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