Strategies for Football Clubs: Financial Sustainability
Type
book
Date Issued
2020-12
Author(s)
Abstract
Managing the finances of a football club is complex. The revenues a club can generate are very much dependent on its sporting success. In return, however, sporting success is also highly dependent on how much revenue a club can generate and therefore invest in the squad. Financial executives always need to find the right balance between investing enough money in the team to maximise sporting success, without taking excessive risks and harming the financial stability. This balance act is even more complicated by the fact that the football business is under great public scrutiny and very much driven by emotion. In recent years, the football industry has been publicly criticised and accused of being unsustainable and disconnected from reality. Now, since the whole industry is struggling due to the COVID-19 pandemic, public interest in the financial situation of professional football has risen. Club managers have to plug the holes left by the COVID-19 crisis while simultaneously being successful on the pitch. League associations and federations are discussing new regulations that could positively change football in the future. Hence, now it is the perfect time to critically reflect on the financial sustainability of the football industry and to set the course for a successful future.
Analysing financial ratios of European football clubs shows that it is wrong to say that the football industry as a whole has a fundamental financial problem and is bound to fail. However, many clubs, especially in smaller leagues, were already in financial difficulties before the current COVID-19 pandemic. Therefore, it seems worthwhile to come up with ideas for how such clubs can be set up in a more stable way – especially now, when the business is more receptive to change than ever.
There are various approaches and ideas of how to make financial management in football more sustainable, some of them already being discussed in league associations or committees of UEFA and FIFA. Within this report, several approaches for improvement are introduced and a timeline with possible short-, mid- and long-term measures is set up.
Analysing financial ratios of European football clubs shows that it is wrong to say that the football industry as a whole has a fundamental financial problem and is bound to fail. However, many clubs, especially in smaller leagues, were already in financial difficulties before the current COVID-19 pandemic. Therefore, it seems worthwhile to come up with ideas for how such clubs can be set up in a more stable way – especially now, when the business is more receptive to change than ever.
There are various approaches and ideas of how to make financial management in football more sustainable, some of them already being discussed in league associations or committees of UEFA and FIFA. Within this report, several approaches for improvement are introduced and a timeline with possible short-, mid- and long-term measures is set up.
Language
English
HSG Classification
contribution to practical use / society
Publisher
Football Business Inside
Publisher place
Ligist, Österreich
Pages
54
Subject(s)
Division(s)
Eprints ID
262252