Is all rosy?

S

sharpshooter11

Member
Jan 30, 2012
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These views are not my own, i'm just putting forward an idea.

We all seem totally behind Cortese's visions for the club, and feel that he is going to take us to great heights without endangering the future of the club, but how can we be so sure? Indeed, Cortese has given us no reason to doubt his handling of club finances, but then i'm sure Po**ey fans didn't see the writing on the wall when Sasha was telling them he was going to build a super-stadium and invest hundreds of millions into the infrastructure of the club. So this is my idea, how do we know we are not heading the same way as our blue friends down the road by chasing Corteses dream of having us challenging for a top four place. You could argue that his dream is based on home grown talent rather than big money signings, but then he has spent a hell of a lot of money this year on young, foreign talent, on (I suspect, but no factual evidence to back it up) wages that are extremely high for a club who averages just over 30,000 attendance a week. So this is my question, how do we know Cortese can be trusted and we won't end up like many other teams who believed their chairmen was doing the right thing for the club, until it all went pare shaped?
 
Our wages are not extremely high...quite the opposite, actually. It was rumoured that Ramirez is making something like 30-35k a week, and he's at the top end of our pay structure; that's quite reasonable compared to a great many of the mid-level clubs.

Such is the advantage in buying young players from the continent; many of them are making what would be considered good Championship wages, so a significant raise doesn't break the bank.
 
The answer to your question is that NC has a background in sports business. Most of the cases like Pompey are where the dots were not joined and I remember one of the Pompey accountants was quoted as saying that the club was bankrupt from the moment they won the FA Cup, such were the bonuses which we're payable under the contracts agreed. NC knows what he is doing.
The other aspect is that a lot of the money spent has been invested in areas where it will have increased the value of the club. It is not saddled with massive debt and I cannot see the family selling the club to some bunch of chancers planning a leveraged buy out such as happened at Man U. If worst came to worst then our best players could be sold. We might tumble down the League a bit but we would not go bust.
If NC is right, and I believe he is, then with the enormous income from the Sky contract, the Acadamy, and a tight rein on salaries, then we could actually have a sustainable business model to be envied and copied.
 
Channonfodder said:
The answer to your question is that NC has a background in sports business. Most of the cases like Pompey are where the dots were not joined and I remember one of the Pompey accountants was quoted as saying that the club was bankrupt from the moment they won the FA Cup, such were the bonuses which we're payable under the contracts agreed. NC knows what he is doing.
The other aspect is that a lot of the money spent has been invested in areas where it will have increased the value of the club. It is not saddled with massive debt and I cannot see the family selling the club to some bunch of chancers planning a leveraged buy out such as happened at Man U. If worst came to worst then our best players could be sold. We might tumble down the League a bit but we would not go bust.
If NC is right, and I believe he is, then with the enormous income from the Sky contract, the Acadamy, and a tight rein on salaries, then we could actually have a sustainable business model to be envied and copied.
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Indeed, well put CF. Besides, it actually doesn't take belief, in any case. If one looks at Cortese's background, one realises he isn't going to sell the club short or over estimate its potential. This bloke is an expert in this area if anyone is.

I do wish people would stop trying to find little avenues of failure, when success may be staring them in the face, if they let themselves see it. After all, it's not as if they have to make a primary input. All they have to do is watch and cheer.
 
Wages are what sinks clubs and we have reason to believe our wages aren't actually that high. Everyone panicked when they said Ramirez's wage had been tripled... until it came out he was only on £10k at Bologna.
 
Mr. Nice said:
Wages are what sinks clubs and we have reason to believe our wages aren't actually that high. Everyone panicked when they said Ramirez's wage had been tripled... until it came out he was only on £10k at Bologna.
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Additionally, I can't remember who it was, but there was a journalist in August who noted that -- despite promotion raises for a good many of our best players -- they were still making wages well below the norm for good PL players.

As you say, it's wages where teams come undone; a difference of $10k p/w average for a 25-man squad equates to a Gaston-sized transfer fee every season, not to mention the flexibility to move players on if need be. If you combined all the players in our squad who might be unwanted come summer, I'd imagine that their combined wages equal less than one Jose Bosingwa.
 
If Cortese did want to try and do what Gaydamak did (and I seriously doubt he does), he couldn't anyway. Gaydamak was owner of Portsmouth and he was pissing around with his own assets.
 
I'm not for one minute saying that we are heading the same way, neither am i saying i think Cortese will lead us that way, i'm just saying what some may argue. Also like to point out my comment about payers earning big wages was about young European talent, such as Ramirez, and Coutinho or Astori if we had signed them. Just think it's worth debating whether we are as stable as we like to think, for example the losses the club suffered in League one and the Championship.
 
We mustn't look at the financial side short term. There will be years which look bad to us who lack financial expertise. We've paid off two managers and bonuses on the last two seasons must be high...can you imagine what Cortese and Adkins got, never mind the team? A lot of money has been laid out on the infrastructure as well. That is one of the differences between us and some teams...we haven't paid vast sums for masses of players on high wages without investing in the club itself. The Academy is expensive to run (rumoured to be 2.3 million/yr), but will produce players we can use and a source of income from players we sell.

The owners have shown no sign of trying to make a quick killing...the investment means that this can only be a long term plan if they are to make a profit. They are also rich enough not to have to cut their losses in bad years. For this to go completely wrong, Cortese would have to lose all his financial acumen and, whilst possible (football can make fools of us all), I doubt it.

Just don't read our financial reports for last season without a glass of whisky in your hand.
 
Football finance has to be a nightmare. The best comparison is probably with teams like Fulham, Stoke, maybe Swansea, QPR. All have average or smaller gates than us but have survived quite well. With the new regulations clubs will be restricted to what they can borrow anyway so an awful lot more finance will be required from within (directors and board members etc) It will not however be allowed to be a listed loan against the club I do not think. Club finaciers etc can of course make up the difference I am just not sure how the books are balanced for these people.
 
The financial model on which football is based in the UK and most of Europe, is utterly ****ed (is the swear filter working again yet? If not, sorry). From Chelsea to Crawley, via Man City and them lot down the road, the numbers simply do not add up.

In that desperate context, Saints look like one of the better run "business'", so I wouldn't worry too much. I worry for the game, though. Can the wheels fall off SFC? Of course, but it's by no means likely in the short term. Can the whole edifice on which the professional sport is built collapse like a house of cards? Have a look around - it already is.
 
Archers Road said:
The financial model on which football is based in the UK and most of Europe, is utterly ****ed (is the swear filter working again yet? If not, sorry). From Chelsea to Crawley, via Man City and them lot down the road, the numbers simply do not add up.

In that desperate context, Saints look like one of the better run "business'", so I wouldn't worry too much. I worry for the game, though. Can the wheels fall off SFC? Of course, but it's by no means likely in the short term. Can the whole edifice on which the professional sport is built collapse like a house of cards? Have a look around - it already is.
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Agree with this Archers. Football is a ticking bomb and little explosions are already happening.

We'll just have to trust NC. I haven't seen any financial papers, so I don't really know, however if I had to choose a profile of the person to run us financially sound then that profile would be very similar to NC
 
It comes to something when everyone seems to think that £35k a week is not high. It may not be very high relative to what other clubs are paying but its still an obscene amount that is pricing the average punter out of the game.
 
Lff said:
It comes to something when everyone seems to think that £35k a week is not high. It may not be very high relative to what other clubs are paying but its still an obscene amount that is pricing the average punter out of the game.
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Don't think that anyone disputes that. However, within the context of the modern game, and the sheer amount of money moving through the system, it is reasonable.

By way of a benchmark for exactly what we can spend, the best I can think of -- simply because they were apparently in the black at the time they went down, didn't have particularly significant net transfer spending, and probably had revenue in the same ballpark as Saints -- is Wolves. The Guardian had them spending 38m on wages in '10-'11; I'd be surprised if ours weren't in the same range, given that many of our players not only signed their contracts at a lower division...some signed (and apparently haven't been renegotiated) in League 1.

All told, we're almost certainly losing money this year owing to acquisitions, but I'd take a wild stab that we'd be at or around the break-even point if not for the money spent on transfers. Attendance is good (we haven't dipped below 28k announced all year), and while commercial earnings are probably pretty low, we've likely been on television a little more than your average lower-table side, which should be of assistance. Given the comical increase in television revenue beginning next season, and the fact that we probably aren't get to be net spenders to the tune of 30m+ per year, I'd wager that we have a pretty good shot at being pretty financially stable, so long as we hold the line on wages and avoid the '35 men for a 25 man squad' trap.
 
SAINTDON13 said:
http://www.dailyecho.co.uk/sport/sa...king_football_fans_are_just__customers__now_/

If you were feeling cheerful today this thread will help you dumb down a bit.
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Glad to see that no-one has posted agreeing with the article yet. Interestingly the article isn't written directly in response to anything Cortese has said or done, but is in support of another article in the Sports Echo by another Echo "writer" (I use the term loosely). They have dragged up every example of Nicola's supposed inhumanity, from Reuben Agboola having to buy a ticket, to the fact that the yellow away kit isn't on sale, to prove that Cortese regards us as "customers". Well I don't mind being a customer of a successful business, it's better than being a supporter of one that's failing that's for sure (mentioning no names).
 
Good business generally dictates that companies should value their customers and seek to improve their experience wherever possible (ignore Ryanair for a second). Supporters are valued, but it's less clear how as there is no direct link between impoving a service and generating more revenue. Moreover, customers are supporters by definition - if you make a purchase, you are supporting a business.

The whole idea behind the Southampton project is developing a brand of football and a club ethos that people admire and want to be part of. People want to support a club that has good community links, that develops talent, that seeks to be the best it can be, that is respectful of its competitors and the authorities and that plays exciting football. People want to show the club its support by buying tickets, watching Sky, buying merchendise and so on, which by definition is giving the club their custom.

"Customer" is not a dirty word, in fact it demonstrates that the club recognises their importance and seeks to improve their experience at every level.
 
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