Football Blog: Tangerine Flavoured

Thursday, July 9, 2020

Yet another bad owner. Where do they breed them?

This is Brooks Mileson. He owned Gretna FC. If you don't know who he is or what the score is with Gretna, it might be worth giving it a once over, otherwise my carefully crafted conclusion will fall flat. It's a story about what happens when the 'good owner' leaves and the club can't cope. It's relevant.  
Bad owners. Won't someone think of the fans. We've got to stop the bad owners. The thing that is wrong with the game these days is bad owners. Tut, tut, tut, bad owners. Blah, blah, blah, bad owners, fit and proper, bad owners, EFL, FA, Bad owners, something should be done tut, tut, tut. 

I'm sick to the back teeth of hearing about bad owners. Of hand wringing on podcasts and in newspaper columns about bad owners. Naughty, mean conniving owners who don't respect the traditions of the game and the culture and communities the clubs are supposed to represent. Sneaky, cheating, dissembling owners who to everyone's utter surprise, don't represent the absolute best values that humanity has to offer.

What I'm specifically fed up off, is the generally circuitous discussion that goes something like this:

(end adverts/news)

- Well, let's look at what's happening at Wigan/Oldham/Bury/Charlton/Blackpool/Macclesfield/Bolton/Newcastle/Sunderland/anynumberofotherclubs, things aren't going well are they?
- No Alan, you've got to feel for the fans.
- That's right Alan, it's the fans I feel for.
- Yes, I mean the fans want clubs to go out and spend money, but they've got to be careful what they wish for
- It does make you wonder
- It does, yes, you've got to wonder
- The owners passed the fit and proper persons test
- They did
- I wonder if that test is fit for purpose?
- Well, you've got to have questions don't you.
- Ultimately Alan, it's the clubs who set the rules
- That's right Alan, if there's going to be change it's got to come from the clubs
- Yes, the responsibility for all of this lies with the clubs and you've got to say, the bad owners.
- That's right Alan, it's the fans I feel for

Ok, let's move on.

Even more erudite sources, don't really move beyond that level and literally pages of broadsheet coverage are expended on saying very little at all about anything. We're given the lurid financial details and the patronising colour pieces about 'what the club means' to a few local fans, but it's rare to read a piece (and rarer still to hear one) that asks any bigger questions or gets beyond paying lip service to the idea that anything is really wrong with the game.

I'm not expending much time on the particulars of Wigan's recent crisis here. Other sources will give you chapter and verse on what has happened with greater authority than I.

Wigan are a club I'm simultaneously quite fond of and actively dislike at the same time. I spent many an afternoon at Springfield Park in the pre Dave Whelen era (when Blackpool were away or my dad was otherwise engaged so Bloomfield was too distant) I am fond of these memories. Winston White's two goals on his debut remain vivid in the mind, as does his singular failure to repeat anything resembling that quality thereafter. Bryan Griffiths, Alan Tankard, Kenny Swain, Graham Barrow, a spindly Keith Gillespie, Bryan Hamilton, Graham Barrow, Tony Pennock, Joe Parkinson... These are proper football memories and I'm glad I shared them with a few thousand people in a ramshackle ground.

The Wigan I'm less fond of is the 'Plucky Little Wigan' story. Spending their way through the leagues, building a lego ground, attracting crowds of 'life long' Wigan fans when United and Liverpool were in town. Wigan, the little bankrolled miracle. I can hear Latics fans now, telling me that's a very bitter and cynical reading. Yes it fucking is. I don't care. I'm not sorry. 90% of you 'lifelong latics' over the age of 35 supported Liverpool on TV when you were shite and you know that's true. I know it's true cos I was stood on the St Andrews terrace with less than 2000 other people with my mate Quinny on any number of ocaissions. Sneaky little Blackpool badge hidden away beneath my coat. Sometimes even wore my INENCO top under a jumper. Watching a shite team that was touch and go as to whether it was as shite as ours or not. Then Dave W turned up, I moved away and he brought (bought) you to where you went.

Ok, we've got the tribal bitterness out the way. Lets be clear - I don't want Latics to go bust. I want to beat them. That's the point of rivalry. There is no point wishing your rivals out of existence. I don't want any football team to go bust. I wish relegation on the ones I don't like but not financial disaster. It's only a sport and you hate my team and I hate yours, but without each other, it would really be a lonely old world and actually, hatred is a right waste of energy outside of 90 minutes of noise and tension. 

What I want is for us to start thinking about the bigger questions. 

Let's start with these two:

Why are there so many 'bad owners' at the moment? What is causing this instability, where so many clubs are seemingly in a precarious position (Covid aside) and so many fans disgruntled with their owners?

Why don't we do anything about it?

I vaguely remember Newport and Aldershot's troubles. My first Pool game was against the soon to be defunct Maidstone United. I very much remember the Chester City madness as a spectacular example of mismanagement and Michael Knighton's Carlisle shenanigans. The point is not for me to try and explain the gruesome details of these cases - I've just plucked them from memory as examples. I merely wish to illustrate a simple point - that we've had plenty of warning that 'bad owners' can and will ruin football clubs. Whether willfully in the case of the property speculator or asset stripping types or through ineptitude and over reaching themselves in the case of plenty of others.

We've also had plenty of warning of the scale of the financial issues. There seems to be general shock at the idea of Wigan's plight yet I (a mere fan with no special financial insights - I'm not even a fan of Wigan - I don't even look for their results unless they're on the cusp of coming down to our league) was aware the club had significant debt and was running at a daily loss of about £20,000.

That's a spectacular level of financial worry to any normal business and yet somehow, Wigan weren't considered an 'at risk' club which seems absurd until you acknowledge they are far from exceptional within the Championship. If Wigan were at risk then so were half the other teams in the second tier of 'the world's best competition ever'

This is a club who haven't turned a profit since 2012 (I don't know when they last did, it's just as far back as my googling is prepared to go) and had £20 million's worth of debt.

A club who has consistently operated at a loss for 8 years and has racked up debts that are eye watering by any conventional (i.e. non-football) standards.

As I said above. For a championship club, Wigan are not remarkable. There are many of them operating with the same conditions.

For Wigan, it's been fine to date - they've been propped up by owners willing to make debt disappear and fund a (fairly) competitive side (Wigan has also made a loss on transfer fees in every season since 2012.) This isn't unusual. Many other teams exist in the same way. Perhaps Blackpool do. We don't know, we haven't seen any post Oyston accounts yet, but it's a safe bet that we rely on the munificence of our benefactor for our own progress.

Of course, in reality it was a surprise what happened. Wigan seemed to be at peace with their finances and didn't have creditors kicking down the door - but the broader point is - if football is a business, what other business would survive running at a loss and racking up debt for 8 years, then get sold for 41 million pounds? What sort of people are out there buying that sort of business?

Why are there so many bad owners? Perhaps, it's because the finances of football are so fucking precarious, because so many clubs are debt pits and no one sane would invest in them if they didn't have a couple of billion quid spare. Alternatively, maybe the only people mad enough to pay £41 million for a club like Wigan are those who don't really understand the financial set up of English football. Perhaps they saw 'FA Cup winners' and assumed it wouldn't be that hard to set them back on that path.

I wrote at length about the hypocrisy of a media that cheers Premier League largesse and then complains the only people who can realistically buy out Mike Ashley and create a Premier League team are the Saudi's. If you collude in creating a circumstance where it costs billions to build a team good enough to win the top flight, don't complain when billionaires try to buy clubs.

In a similar vein, if a side like Wigan whose cumulative losses since 2012 run at well over £50 million quid and who are saddled with significant debt cost £41 million quid, don't act surprised if there isn't queue of responsible investors waiting to buy them.

To understand this point (one rarely made in the football press, where everything is fine, if it wasn't for the bad people) just play along and use your imagination in this (admittedly a bit sexist) piece of whimsy. 

Scenario - You own a successful business in the Wigan area. You've earned a decent amount and what to give something back to the community/get one over on the lads who mercilessly bullied at school by buying the football club and flaunting your wealth on the pitch in front of them.

Context - You are well off. By crap town English standards you are very rich. You've got a tasteless new build mansion and the car of your dreams. Your wife is bedecked in luxury and you've bought her loyalty through an endless series of foreign holidays and by helping her to amass a small property portfolio, including some Air B+B's in the Algarve. Your children are privately educated of course and have certain expectations about their opportunities in life, borne of the success and wealth they see in front of them. You've already bought the local golf course. You remain hands on with your main business which is doing well. Remember, you are not the head of Microsoft or a Gulf state though. You are very rich, but by crap town standards. £35k a year is a very good wage in this town. Wealth is relative.

Underneath all of this, is the fact you've worked very fucking hard to get where you are. It's required you to be a complete cunt to some people along the way and to protect every penny you have and use it to make you another. It's not easy to lose that mindset, for that's exactly what got you where you are. A mixture of business sense, hard work and hard nosed bastardry.

Now you understand the character, let's proceed to the actual imagination exercise.

Exercise - You examine the finances of the club when you consider making the bid. You note the club is losing considerable amounts of money. You consider what could be trimmed from the running costs, but you keep coming back to the fact the wage bill is £30 million pounds.

You realise you can't trim that because it would make the club less competitive. It would be like taking a loss making business and making the product worse and reducing the number of customers. The club is already at the wrong end of the table and has recently slipped to the league below. (where losses increased significantly)

You think 'maybe we could ride those losses for a few years if we get into the Premier League' and think about a different approach. You could invest now and reap the rewards later. You do a bit of maths and realise the clubs that come down from the division above you (and those who came down the year before) are starting from a considerable financial advantage as they not only received a cool £100 million quid for just being in the Premier League, but will receive another payment of around £50 million as a further reward for being relegated.

So you're now thinking about investing in a club that is making a loss, is £20 million in debt and facing shelling out another huge sum on top of that to try and plug the gap between you and your competitors in terms of income. Add to this the fact that you are also someway behind other clubs in revenue from matchdays, sponsorship etc.

Not only that, but if those sides don't go up, they'll receive yet more money the season after and another team will come down with an extra £50 million (ish). Plus, (remember, you're a realistic businessman) in all likelihood it will take at least 2 or 3 seasons for you to get promotion (meaning you're looking at 2 or 3 years of sustained losses and considerable additional investment to reach that goal)

Thus, optimistically, you could say it would cost you (assuming promotion after 2 years, which is highly optimistic) upwards of £120 million to get the club to the Premier League. You've also got to bear in mind that's a conservative estimate. It could easily take 4 years or 6. It might take 10. You might *never* (hello Preston!) make it. - How on earth would you recoup the money you put in? Remember, this is a club that has turned a loss on transfers for the last 8 years.

IF you get there, you'll get £100 million, but of course, to remain competitive, you'll have to increase the spending on wages and players and you're likely to spend much, if not all of that sum just trying to stay afloat in a league where the likes of Liverpool will be starting from a basic position of having earned in excess of an additional £150 million in TV rights ALONE. (not withstanding their considerable global income as multinational brands) 

Thus, the £100,000,000 seems smaller every time you think about it. Remember - you went into this with good intentions. You didn't want to make a profit, but did you want to risk everything you'd built?

Question: When your wife and kids ask you "Can you really afford to buy the club? - Will it put us at risk? - Will you be able to make a success of it? What if it goes wrong?" - What would you actually say...?

Maybe you'd watch Netflix and Sunderland Till I Die and see what happens when people who aren't as rich as they probably need to be, try to run a football club like a conventional business. Maybe you'd think about how they come across and decide 'that's not the look for me' and decide it's better to invest in a swimming pool instead. 

Maybe you'd gaze around your gated palace of tack, cast a glance at the garage containing the expensive motorbikes you never ride and look at your 'Greater Manchester Businessman of the Year award' and think 'not worth the risk'

----

We're constantly listening to podcasts, radio and TV wondering why 'we' let 'dodgy foreigners' with dicey values and questionable records take over clubs.

The simple fact is - because most local people, be it well to do business people or communities pooling resources simply can't afford to buy into football clubs and when they do, it often stretches their resources to breaking point just trying to remain competitive.

This is why there are so many 'bad owners' - it's not simply because the 'fit and proper' test fails. It's because there aren't enough 'fit and proper' people who can actually afford to own a football club and 'fit and proper' people look at the spiralling costs and absurd and anti-sporting financial barriers to progress and think 'fuck that'

Which leaves the naive, the misguided and the asset stripping sorts as the only options.

What do we do? 

In conventional debate, the answer to this question seems to revolve around the need for the FA or the EFL to regulate club sales. The problem is, the FA and the EFL are often desperate for sales to go through as there are a lot of clubs in Wigan's position - clubs who are essentially not financially viable businesses in and off their own right. Clubs who desperately need to be 'owned' but without a lengthy queue of millionaires who want to lose their money (by definition, that's not really something most millionaires do well) the options are few and far between. Raising the 'Fit and Proper' test just kicks the can down the road. It stops the takeover by the genuine shark, but it doesn't drain the ocean the shark swims in.

If the 'fit and proper' test was highly stringent, we'd still be stuck with the financial conditions outlined above. It wouldn't lower player wages (and thus club outgoings) or deal with the vast inequalities of income between teams and between divisions. It wouldn't regulate agents and control transfer costs or solve the problem whereby rich clubs are able to hoover up the best talent in vast academies and thus make themselves a) more competitive and b) reduce the likelihood of smaller clubs being able to trade at a profit by producing talent themselves.

Yes, Wigan might not have happened and Steve Dale might not have had Bury and maybe the Oyston's could have been challenged but ultimately, none of those individuals are the root cause. They're merely symptoms and as a Doctor of blogging, I can say that treating the symptoms might make us feel better for a while, but if our illness has an underlying cause, if we want to actually recover from it, we have to look at that.

When so many clubs are in some form of 'crisis' - (again, it's vital to point out that this crisis predates Covid 19) and even greater numbers are running at significant loss and/or saddled with significant debt then sooner or later we have to ask...

- If 'bad owners' are the problem and they keep reoccurring, why don't we get rid of 'owners' in a conventional sense? Investment within, alongside others and ownership of, with full control over, are two very different things. The German model is oft cited, but we seem nowhere near even thinking about it. Barcelona manage fine (well, to be fair, they're in crisis too, but they've done better than Macclesfield in general) 

- If we see stuff like supporter oversight in the boardroom as a dangerous lefty fantasy, then what does the sport do to attract 'good owners' who will run clubs responsibly?

- If 'good owners' (i.e. responsible people who will run clubs within their means and for the good of the local community and supporters) are priced out of the equation then how do we reduce costs in football to make the game attractive to these people?

- If we don't, why would we be surprised when the next club owned by a shady company or a dodgy egotist is in crisis?

The crucial point is this - it's not about simply rallying round or pitying the clubs who have suffered ill fate. Unless you support the biggest clubs (and even then, you've got the Glazers and the unrest at Arsenal) - whilst you may have the best, most generous and accommodating owner in the world, if they lose interest, suffer ill fate in their main business, or even worse, die, then your club is cast into this world. The chances are, unless you are Liverpool, you are running at a loss or your breaking even but have either stagnated or hit the limit of your ambitions and are desperately trying to stay afloat in the waters warmed by the Premier League TV money (basically, the Championship)

At an extreme level, a club like Gretna was an absurdity - but they show what happens when a team is reliant on one person, when their success is bought. In the world of football as it is, the reality for any side beyond an elite few (who have their own distinct problems in the main) is that to get success, you have to be a bit like Gretna - and when your Brooks Mileson (see! I told you he'd be back...) cannot fund you anymore your fate will be uncertain and possibly very tragic. Whilst your implosion might not be as absolute as theirs and there's a chance you might get lucky, we could be going from Uncle Jack to the Venkys. From John Hall to Mike Ashley. From feast to the beasts sniffing at the leftovers hungrily...  

There will be nothing you can do about it and bleating about 'fit and proper people' won't fix it.

You deserve better.

Wigan deserve better. I may deride them for living off Uncle Dave's money and their self mythologising of their bought success, but I used to get the 634 bus to Springfield Park and I love playing Wigan as I can go and see my much missed best mate after the game. It's my own personal derby match. I wouldn't wish their demise for all the money in an agent's pocket. Because, despite my words above, their dream is my dream in a different coloured shirt. Having dared to get above their station shouldn't be rewarded by being ripped from the community that they belong to. The people who stood on the St Andrews terrace with me, the people who dragged the club from non-league, always in the shadow of the rugby club, people who sobbed when the FA Cup was won, the fans in the town who grew up Latics, not Liverpool or Man Utd as a result don't deserve that. Wigan is every slightly shit town that needs a football club to give it a bit of a lift. We're all Wigan. We're all Bury but for a few twists of fate. 

We've got to face it. The game is sick. The bad owners are just a symptom. We're all at risk. It's up to those who govern to take charge and make it better. Stop demanding things that won't fix what causes the problems and start demanding things that will. Then football might be good again. God forbid, we might even win something one day


Success. At what price?  



UTMP

0 comments:

Post a Comment

Yet another bad owner. Where do they breed them?

This is Brooks Mileson. He owned Gretna FC. If you don't know who he is or what the score is with Gretna, it might be worth giving it ...