financial fair play.

[Blawarmy]

How are Chelsea constantly allowed to spend ridiculous money? Even when they havent qualified for Europe?

[love4ffc]

How are Chelsea constantly allowed to spend ridiculous money? Even when they havent qualified for Europe?

If you are to believe the Chelsea website and Forbes despite the restrictions placed on the Club, the turnover figure increased to £481.3 million from £434.9 million the previous year, driven largely by increased matchday and commercial revenue from the return of fans on matchdays.  Transfer market lists Chelsea's total winter transfer window expenditure at over $350 million, making it not only the highest spender in the Premier League by some distance, but also saw it spend more than all the teams in Europe's top five leagues combined. 

With that in mind, last season they made more than they spent.  It will be interesting to see what Chelsea made as a club this season verse what they spent since by all appearances the new owner spent like crazy.  It will also be interesting to see if the rumor mill is correct on how the new owner is going to get around FFP by selling players to Saudi clubs for big money. 

[Twig]

Thank you for some clarification. Looking at it simplistically, it makes sense that manu 75000 capacity, (plus all merchandise sold from Cleveland to Crawley) have more money to spend than Fulham but the amount of money sloshing around is eye watering. I do believe it is ruining the game in England, will be ever see another Leicester achievement?

I will probably make it to 4 or 5 games (live in Scotland) but would rather avoid the top 5 teams. I do have sky so have to try and avoid the (rarely) televised Fulham matches. Not easy when booking trains has to be done in advance for best price.

If you read Benhamdoun's summary of the FFP rules he states that neither gate receipts nor merchandising are included in the calculation. I didn't know that I have to say.

If gate receipts aren't included then why did SK spend a fortune on a new stand to increase the capacity? Surely the increased capacity goes towards our income to spend on players and hence FFP. Obviously the actual cost of the new stand is outside of FFP.

Don't ask me, I don't pretend to understand it all. I was just referencing someone who does claim to get it.

[The Rational Fan]

"Financial Fair Play" requires that all 20 Premier League Clubs to agree what is fair, which will never happen.

Every ManU fan seems to think that "fair play" means that the club with the most fans should win have the highest wages and transfer budget so they can have the best players.

ManCity fans seem to think "fair play" means the club that won the League the previous season, should have the biggest budget. Luton fans think the most fair is every club having the same budget. Newcastle fans probably think the richest owner should have the biggest budget.

These conflicting ideas are in no way compatible with each other, so the idea of producing a guideline that everyone accepts on what is fair vs unfair play is impossible. Instead, Clubs form alliances with other clubs on what is fair and unfair.

As you mentioned that Man Utd may have the most fans, but not necessarily the most supporters.
As fans are short for fanatics who are not necessarily true supporters.
The size of clubs like Man U who have large Trophy Cabinets tend to attract Pot hunting individuals who forgot to grow up, hence the name FANatic.

I think this is the fundamental problem (clubs keeping their fans) that FFP is trying to solve, especially for Clubs like ManU that have 74,000,000 fans and probably less than 740,000 supporters. The ManU fan base is a very valuable financial asset, but if they don't challenge to win the premier league their fans might abandon them and they will be left with only their supporters. And, from the perspective of ManU's owners, ManU losing their fans to some other club that is buying trophies is financial unfair. It's that simple.

[Arthur]

To comply with the Financial Fair Play regulations, only a club's outgoings in the area of transfers, employee benefits (including wages), amortisation of transfers, financial costs and dividends will be included.

It will not include revenue from gate receipts, TV revenue, advertising, merchandising, or money spent on infrastructure, training facilities, or youth development. This part of the rules is not good for Fulham as we get a lot of TV revenue.

https://www.bbc.co.uk/sport/football/29361839

Though the article dates back to 2019, unless the rules for FFP have since been turned on their head (which I don't think is the case), the following applies:

'Clubs need to balance football-related expenditure - transfers and wages - with television and ticket income, plus revenues raised by their commercial departments.'

[The Rational Fan]

To comply with the Financial Fair Play regulations, only a club's outgoings in the area of transfers, employee benefits (including wages), amortisation of transfers, financial costs and dividends will be included.

It will not include revenue from gate receipts, TV revenue, advertising, merchandising, or money spent on infrastructure, training facilities, or youth development. This part of the rules is not good for Fulham as we get a lot of TV revenue.

https://www.bbc.co.uk/sport/football/29361839

Though the article dates back to 2019, unless the rules for FFP have since been turned on their head (which I don't think is the case), the following applies:

'Clubs need to balance football-related expenditure - transfers and wages - with television and ticket income, plus revenues raised by their commercial departments.'

The Accountancy Rules are simple. For example, if Man City receive more money from their owners that would be cheating; but if Man City receive money from Etihad Airways that would be legitimate; unless Man City Owners facilitated Etihad Airways giving money to Man City that would be cheating.

And, if all the people involved did all their banking within the UK, we could find out the answer. If the banking was done, elsewhere the banks of these other countries would have to cooperate with the investigation.

If some of the banks in the world don't cooperate, then FFP is a joke.

[bill taylors apprentice]

So, if clubs need to balance football-related expenditure with income, including revenue raised from commercial business but not from an owners pocket, clubs who start from a more powerful position have the upper hand.

In the past a MAF type owner could have (and did to some extent) raise a club from the depths to PL status.
If our ground and the surrounding area were more suitable for expansion it could have allowed further growth and succeed as others have done

Clubs like Newcastle, Man C etc who already have the catchment area, history, stadium etc etc can join the elite with new owners willing to invest and maybe bend the rules.

But the rest can only reach so far and at best always be second class in comparison with occasional temporary membership of the elite clubs e.g. Leicester C and Blackburn R.

IMO part of the beauty of football was the owner willing to fund success (or at least try) as the Wrexham example has captured the imagination., albeit on a smaller scale.

It's becoming almost impossible to join this elite group as their historical position in English football, and their position in the hierarchy of clubs when the PL started almost creates a cartel.

[Craven_Chris]

I have written a few blog posts over the years about Fulham and FFP - this was one of the first and it contains an overview of the FFP rules as it relates to Fulham (https://cottageanalytica.com/2020/08/27/fulham-fc-and-financial-fair-play/ ). Its a little out of date on the finances, but the rules are still correct. If you search that website you will find a number of more recent articles about Fulham and their FFP position.

One comment from reading this thread that I thought worth clarifying, gate receipts and merchandising absolutely do count as income for FFP purposes. The slightly surprising thing is that gate receipts in particular are a a pretty tiny amount of a clubs income.

This season Fulham probably brought in about £160m in revenue, and of that about £14m will be from gate receipts and other match day income. Another £15m to £20m will come from corporate sponsorship and other commercial activities. Then the vast majority (£130m) will come from TV.

So the fact that Man Utd get 75,000 bums on seat and we get less than half that, doesnt actually lead to the disparity in financial power. The big difference is the commercial income (sponsorship and merchandise) and then the additional TV money that comes in once you start qualifying for Europe regularly.

If Fulham want to close the financial gap, they need to be marketing themselves to the American market, we are well placed to do that. Interest in football is growing fast there, and we have strong connections. If we can be 'America's team' in the premier league, I think we could close the financial gap on the top 6.

[Craven_Chris]

It's becoming almost impossible to join this elite group as their historical position in English football, and their position in the hierarchy of clubs when the PL started almost creates a cartel.

I agree with this, but I have always felt that us smaller teams a little fortunate when it comes to TV income. Fulham get a pretty large slice of the TV money pie, considering not many people are tuning in specifically to watch Fulham. The Premier League TV money does get weighted towards the more successful teams, but not massively so. I always thought it was interesting that teams like Fulham do so well, Im sure the big 6 argue that 80% of the viewership only is interested in them, therefore they should get 80% of the revenue (this is probably a big part of why they want to split away). The the Premier League resists this, presumably they want a better product with competitive challenger teams.

I guess I thought this worth mentioning, because things are not completely skewed to the big clubs, it could be worse (which probably means that in the future it will be)

[toshes mate]

FFP needs to be scrapped. I would replace it with a cap of 500 million pound limit on the price of The 25 man squad phased in over 5 years for the premier league. There should be two accounts, a club one and an owners one. The club one can never go in debt and no structural building can be sold unless replaced by new ground. The owners account can be used however they wish ie if they wish to pay high wages but any debt is their sole responsibility and not the clubs.

Agree tht FFP is more trouble than it is worth. However it suits UEFA and members to have a system that produces so many anomalies well after the event.  Your suggestion is a much better solution than anything put up by a football authority thus far and does at least protect the football club from the worse excesses which FFP and fit and proper person regulation has failed to do.