Football finances under focus as new season starts this week
This week and next theBusinessDesk.com will be previewing the start of the new 2024/25 football season with a guide to the financial strengths and weaknesses of the region’s professional clubs.
Starting tomorrow with analysis of the three Lancashire clubs in the EFL Championship, Blackburn Rovers, Burnley and Preston North End, we will then look at the five regional clubs in League One on Wednesday, the seven in League Two on Thursday, and then on Friday a special focus on the ambitions of some ambitious clubs further down the pyramid eyeing up new stadiums and potential promotion bids to the EFL.
Next week we will look at each of the North West’s Premier League giants, all of whom have been in a whirlwind of either takeover speculation or legal wrangling.
We have already been contacted by fans of clubs in the region with insights and intelligence (and unfounded rumours) about investment and takeover activity. Please get in touch if you have more local knowledge.
The stakes are high this season as Sky is paying £187m a year for the rights to screen more than 1000 games across the three EFL divisions, earning each Championship club an additional £2m in income and £400,000 for League One and £200,000 for League Two clubs.
EFL chief executive Trevor Birch said he hoped the exposure would have the knock-on effect of new and better sponsorship activities.
Many clubs are dependent on income from gambling companies, but the televising of games also could have an effect on match ticket sales with fans opting to stay at home and watch their team rather than attending in person.
Also, the Premier League TV deal dwarfs the EFL package, widening the gulf still further between the top tier and everyone else. The Premier League TV deal with Sky is worth £5.2billion over four years.
As reported on theBusinessDesk.com in June, the authoritative Deloitte review of football finance, compiled by the Sports Business team based in Manchester, highlighted how Championship clubs made more money in revenue in 2022-23 than they spent on wages for the first time in six years.
A total revenue of £749m was a 10% increase for clubs in English football’s second tier from the previous year.
It was the fifth most attended league in Europe, with its cumulative attendance of about 10 million putting it behind only the Premier League, Germany’s Bundesliga, Italy’s Serie A and La Liga in Spain.
Despite this, no single club generated an overall profit before player trading, with the league recording an overall loss of £316m, the report said.
“The Football League may have seen an uptick in revenues in 2022-23, but clubs across the EFL are still battling to manage cash requirements,” said Deloitte’s business sport group’s lead partner Tim Bridge.
“Many clubs are propped up by owner funding as they aspire to win promotion, but exiting the league at the wrong end exposes a club to instability.
“This makes a strategy for long-term stability critical, underpinned by appropriate support provided by the governing bodies.”
