Any new business model must not presume Champions League cash

[EddieBadabing 0]

It is now generally agreed that we will certainly have to "live within our means", and that goes for if and when we ever get a takeover too.

Whatever this means, in terms of our playing staff it will not be a positive thing. Our mediocre squad right now command a combined wage bill that sees Champions League money as utterly vital to our club's financial fortunes.

Whatever way I look at it, it seems our reliance on the £10m pot we receive from CL participation has to end. As it stands just now I don't think I am oversimplifying when I say:

• Champions League participation = chance of breaking even/profit
• No Champions League participation = loss (£5-£10m loss??)

Our accountant posters may be able to put more flesh on that bone, but I don't think I'm far wrong with that basic formula...

So here we have a scenario where even if we hypothetically stood debt free, if we jump forward two years without CL participation, our debt could be back up to eight figures.

The news that Scotland's co-efficient has dropped behind Belgium, means Belgium will have two representatives in the Champions League in 2011/12 while the SPL will have just one.

Even the SPL champions will face two qualifying rounds before entering the group stages I believe.

The reliance on CL money and the ever increasingly precarious chances of a) winning the SPL and b) getting through 2 qualifiers, mean that if we are to truly "live within our means", our wage bill (and quality of squad) will have to be diluted even further.

I don't know about you, but the thought of our squad getting smaller and the quality getting lower is truly terrifying. In fact I would go far as it being unchartered territory for our club on the park, a definite full circle back to the 80's when Watford could afford to take our captain.

A depressing post I know, but is there a practical alternative to this scenario??

[Bluepeter9 5,167]

It is now generally agreed that we will certainly have to "live within our means", and that goes for if and when we ever get a takeover too.

Whatever this means, in terms of our playing staff it will not be a positive thing. Our mediocre squad right now command a combined wage bill that sees Champions League money as utterly vital to our club's financial fortunes.

Whatever way I look at it, it seems our reliance on the £10m pot we receive from CL participation has to end. As it stands just now I don't think I am oversimplifying when I say:

• Champions League participation = chance of breaking even/profit
• No Champions League participation = loss (£5-£10m loss??)

Our accountant posters may be able to put more flesh on that bone, but I don't think I'm far wrong with that basic formula...

So here we have a scenario where even if we hypothetically stood debt free, if we jump forward two years without CL participation, our debt could be back up to eight figures.

The news that Scotland's co-efficient has dropped behind Belgium, means Belgium will have two representatives in the Champions League in 2011/12 while the SPL will have just one.

Even the SPL champions will face two qualifying rounds before entering the group stages I believe.

The reliance on CL money and the ever increasingly precarious chances of a) winning the SPL and b) getting through 2 qualifiers, mean that if we are to truly "live within our means", our wage bill (and quality of squad) will have to be diluted even further.

I don't know about you, but the thought of our squad getting smaller and the quality getting lower is truly terrifying. In fact I would go far as it being unchartered territory for our club on the park, a definite full circle back to the 80's when Watford could afford to take our captain.

A depressing post I know, but is there a practical alternative to this scenario??

News of our demise is premature but You state the case pretty well but a revival and a step up the rankings is not out of the question. The real issue is that TV money in big markets is killing smaller countries big clubs - we have had to adjust later than others.

Sad reality is we need Celtic - United - Hibs etc. to also do well in UEFA competitions (for our good as well as theirs).

Also is reading the ranking system the more teams you have in the competition then the eaasier it is to accumulate ranking points - again favouring big countries (sigh)

[TannochsideBear 355]

It was admitted to corporate investors and sponsors a couple fo years ago by Murray and Bain that in order to balance the books, we have to reach the CL group stages in 3 out of any 5 year cycle. The years we are in it bring a profit, the years we are not in it bring a loss, but over 5 years, if we are in it 3 times, we probably break even.

Since that scenario was put forward, CL money has increased and our domestic tv money has decreased, so it may still be true.

Obviously there are many other factors to take into consideration, but that seems a fair reflection of where we are now.

I totally agree with Eddie that, taking co-efficients into account, we cannot now expect to have CL money even 60% of the time, so in order to prevent a fire sale every other year, we have to both reduce our annual costs, and source other revenue streams, whilst making the most of the revenue streams we already have in place.

[EddieBadabing 0]

It was admitted to corporate investors and sponsors a couple fo years ago by Murray and Bain that in order to balance the books, we have to reach the CL group stages in 3 out of any 5 year cycle. The years we are in it bring a profit, the years we are not in it bring a loss, but over 5 years, if we are in it 3 times, we probably break even.

Since that scenario was put forward, CL money has increased and our domestic tv money has decreased, so it may still be true.

Obviously there are many other factors to take into consideration, but that seems a fair reflection of where we are now.

I totally agree with Eddie that, taking co-efficients into account, we cannot now expect to have CL money even 60% of the time, so in order to prevent a fire sale every other year, we have to both reduce our annual costs, and source other revenue streams, whilst making the most of the revenue streams we already have in place.

That is interesting.

Basically we are walking a tightrope of having to win the league 60% of the time, and that tightrope has just got higher with no automatic qualification and maybe even 2 rounds to negotiate.

To keep going as we are, and take the risk of not making the CL and see debt spiral again, is not an option.

A vicious circle of lower quality squad meaning less likelihood of CL qualification threatens to take hold.

Income has to go up substantially (and how can it?) or costs go down. That is what we are left with and as much as it pains me, this is our new reality.