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Financial Fair Play (FFP)

Y

YouReds43

Youth Team
So we sold for 63.8m and bought for 91.9m this season, amortisation will probably be around 25m. Wages around the same or lower, Mangala sale isnt included. Sell Murillo and we are in a good position.
 
Steve B

Steve B

Jack Armstrong
haarlemred said:
I know this has been bought up before, my biggest issue with FFP is the £105M limit. It has been this way since 2013 and doesn't take into account the rise in inflation. Wages and transfers have sky-rocketed in this time. It would probably work if it took inflation every year.
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By the way Haarlem is a great town. Had a brilliant night out there a few years back, met some lovely girls from Groningen.
 
Redemption

Redemption

Chief Eye Roller
haarlemred said:
I know this has been bought up before, my biggest issue with FFP is the £105M limit. It has been this way since 2013 and doesn't take into account the rise in inflation. Wages and transfers have sky-rocketed in this time. It would probably work if it took inflation every year.
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It's the same for everyone. This is the one bit of FFP that barely registers a concern for me.
 
Redemption

Redemption

Chief Eye Roller
I've been thinking about FFP and the gap that exists. I'm preparing a blog, but I recalled this post of mine from September... it's about how competitors evolve.

Redemption said:
There is no chicken or egg.

Newcastle are going through a commercial transformation because the owner injected capital.

That allowed the clubbto compete more effectively.

The competition improvement allowed them to be more commercially viable, selling more shirts to existing fans.

Etc.

The reason that there is a top 6 or 7 broadly that winning on field confers commercial advantages.

For the top clubs, the original advantage was gained in 1960s and was directly related to stadium capacity, which produced a legacy of winning.

By the 1990s, this was consolidated in the emergence of the revenues from TV and UCL.

This powered the advtages that keep growing since the late 2000s with inflating TV licensing.

Its pretty much path-dependent.

Any club trying to break into it needs external investment first to create a momentum that pulls advantage toward them. It's super difficult to maintain without continual investment.

Some clubs have followed a methodology in which external investment can be boosted by player development and sales in the attempt to stay the race.

There's a concept in evolutionary economincs known as the 'Red Queen Effect', in which lagging competitors are said to need to "run twice as fast just to stand still." It's a quote from the Red Queen in Alice Through The Looking Glass, when Alice and the Quee have a running race. Its metaphor about the maintenance of long term advantage relative to contemporaneous performance.

If you listen to the Price of Football podcast, or catch Keiran Maguire in the media, he often uses the phrase "its not just about the size of the pie but how the pie is sliced."

You can think of the advantage as an absolute gap in a relative landscape. For a quick example think of two competitors sharing a 100 unit pie, one having 80 units the other 20 units. The gap is 60 units. If the pie doubles in units, to 200, but the slices stay the same relative percentage, the gap also doubled to 120 units.

To maintain the absolute gap of 60 unit, the laggard competitor would have to take 4 times their original share - grow their share "twice as fast" as the whole pie.

Sorry for the long post, but there is no chicken and egg.
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It's Baggio

It's Baggio

John Robertson
Redemption said:
It's the same for everyone. This is the one bit of FFP that barely registers a concern for me.
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Also, a lot of that inflation would have been driven by the increasing TV money. Last year we finished 16th and earned £118m from the PL. A similar placed finish in 2013 would've earned £45m.
 
D

dr_horse

Geoff Thomas
oxonred said:
What I don’t really understand is, what is the use of having billionaire owners if they’re not allowed to pump their money in to avoid the ffp sanctions.
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There's still the £35m allowable losses each year for someone to cover.

Sent from my M2101K6G using Tapatalk
 
apondaway

apondaway

Viv Anderson
If clubs are truly losing this much money how in the world is the structure not being changed. Or are these paper losses? Why would anybody want to own a football club?
 
M

MaxiRobriguez

Bob McKinlay
apondaway said:
If clubs are truly losing this much money how in the world is the structure not being changed. Or are these paper losses? Why would anybody want to own a football club?
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Personal ego, Sports washing, money laundering, reputation enhancement, greater fool theory..
 
Redemption

Redemption

Chief Eye Roller
apondaway said:
If clubs are truly losing this much money how in the world is the structure not being changed. Or are these paper losses? Why would anybody want to own a football club?
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You're actually regular on this forum. You must have noticed that 99.99% of fans think they could make better decisions than any incumbent owner, manager or player.

So now imagine that one in a million fan who has been successful financially, decides to act on that foolish arrogance.
 
apondaway

apondaway

Viv Anderson
Redemption said:
You're actually regular on this forum. You must have noticed that 99.99% of fans think they could make better decisions than any incumbent owner, manager or player.

So now imagine that one in a million fan who has been successful financially, decides to act on that foolish arrogance.
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Right, but this is far deeper than the fools and their money. Like honestly, what is the point of the industry? Totally going to pull the American card here - look at the state of American professional sports - those people are printing money. How is it that our professional leagues allow for such profit whereas football in general is a race to be able to just barely see the surface of the water above your head?
 
Strummer

Strummer

Socialismo O Muerte!
LTLF Minion
apondaway said:
Right, but this is far deeper than the fools and their money. Like honestly, what is the point of the industry? Totally going to pull the American card here - look at the state of American professional sports - those people are printing money. How is it that our professional leagues allow for such profit whereas football in general is a race to be able to just barely see the surface of the water above your head?
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Because, quite simply, you have closed leagues in America - no relegation.

Owners, and commercial partners, are quite willing to invest millions and millions in the franchises in the NFL, NBA, NHL, MLB, MLS and any other acronym you’d care to maintain, because they know those „teams“ are going to be in the same „league“, year after year, with the same guaranteed revenue.

Look at the drop-off in income between the Premier League and Championship.

Commercially, the Championship is a joke. In the Premier League, you get that season, and if you get relegated, you’re f**ked.

No such problems in American sports, where some teams purposely tank to get first pick at the upcoming college talent in the draft, all the while knowing their position in the league is absolutely secure, and so is their income.
 
apondaway

apondaway

Viv Anderson
Strummer said:
Because, quite simply, you have closed leagues in America - no relegation.

Owners, and commercial partners, are quite willing to invest millions and millions in the franchises in the NFL, NBA, NHL, MLB, MLS and any other acronym you’d care to maintain, because they know those „teams“ are going to be in the same „league“, year after year, with the same guaranteed revenue.

Look at the drop-off in income between the Premier League and Championship.

Commercially, the Championship is a joke. In the Premier League, you get that season, and if you get relegated, you’re f**ked.

No such problems in American sports, where some teams purposely tank to get first pick at the upcoming college talent in the draft, all the while knowing their position in the league is absolutely secure, and so is their income.
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Solid points. Kinda wish the US would have relegations.

Also wish European football capped spending on transfers and wages at the average of the middle 8 club's revenue in their respective leagues.
 
ubik

ubik

Geoff Thomas

Posted stuff on Vital, so you have to get some too.

No idea what it has to do with Forest but there was a link a few hours ago, before the wine hit. Made sense then.

Played VR golf and won a foursome, unbelievable. 14 over for 9 holes, so not tournament quality, but amazing - a row of single bogeys instead of exotic scores. That's what we need - a set of solid wins and draws, nothing special.
 
Mr RayReardon

Mr RayReardon

Jack Burkitt
Apologies ladies and gents, been lying low last week or so. Are we under the impression that we're likely to be docked points again if we don't sell either MGW or Murillo?? Or, is this just lazy journalism given our current situation and those two being our highest value assets?


Surely, keeping them and building a side around them is our best course of action??

Sent from my SM-A256E using Tapatalk
 
Redemption

Redemption

Chief Eye Roller
apondaway said:
Solid points. Kinda wish the US would have relegations.

Also wish European football capped spending on transfers and wages at the average of the middle 8 club's revenue in their respective leagues.
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The issue with that, is this is a matter each league. But in Europe, the leagues are competing against each other for resources and talent.

The argument in Germany, for example, is the Bundesliga wants to bring is fresh, private Capital to help it rebuild its broadcast rights to complete with the EPL. The spending power of the EPL, means that talent from Germany flows to England. And purely from a business point if view, that's problematic.

But football isn't just a business, it's a culture too. In Germany, where the fans have a real say, while they might want better product, their opposition isnt the shift of the focus to overseas TV, its the concession to private capital that would warp/distort their rights in the game.

And then you multiply this by the top 5 leagues in Europe. Then the next 15. And so on. And barely any league in Europe would want the constraints and consequences of wage caps.

You only have see the panic caused by the Chinese and Saudi leagues to see why
 
M

MaxiRobriguez

Bob McKinlay
YellowBelly Red said:
Every PL club, except Burnley, should have their accounts in by tomorrow. Companies House will start publishing next week.
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Burnley are delayed as internet not available there yet and their carrier pigeons are a bit older and slower this year.
 
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