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Challenging times for EFL clubs

There have been lots of gloomy predictions about EFL clubs going out of business, but so far owners have stepped up to the plate and stemmed the losses.

Football is a very unusual sector of the economy because producers hardly ever disappear unlike what happens elsewhere.   Accrington Stanley was the longest disappearance and even it eventually reappeared. The only real disappearance is the sad story of Third Lanark in Scotland: https://thesefootballtimes.co/2019/04/19/how-scottish-football-lost-third-lanark-a-cherished-club-destroyed-by-one-mans-greed/

Nevertheless, one should not underestimate the challenges faced by EFL clubs, particularly if they are only allowed to fill one-third of their grounds, or even worse, 17 per cent.   On average they fill 60 per cent of capacity, but obviously this varies between divisions.   Here are some case studies.

Queens Park Rangers

QPR costs £8m a year to run before you pay any players or coaching staff.   The players deferred of their wages for three months and some senior staff took pay cuts of 45 per cent.  Even so the club is losing between £500k and £1m, depending on payments from the EFL and modest sums earned from retail and streaming.

Portsmouth

Gate receipts and hospitality accounted for £6m of the £11m turnover.   Because it is an old stadium, social distancing is particularly difficult to organise.   They hope to get some cash back if 20 per cent of their 14,500 season ticket holders buy the streaming app to watch matches.

They estimate a low seven figure shortfall by the end of the 2020/21 season.  Their most recent accounts showed a £2m profit.  They saved a six figure sum by furloughing players and all but 30 staff.

Pompey don't like the proposed EFL salary cup.   In League One it would mean that they would be limited to paying an average basic wage of £1,350 a week of £70k a year which would only be adequate in League Two.

Newport County (Sir Casnewydd)

The manager. the players and all of the coaching staff were put on furlough in March.    Their FA cup runs in 2017/18 and 2018/19 earned them a combined £2m which is roughly their annual turnover/   As well as using that money, they have applied to the Welsh Government (Llywodraeth Cymru) for every possible scheme of assistance.

They have benefitted from close contacts with the Welsh Government, but the downside is that the social distancing rules across the border are more stringent.   Nevertheless, they could fill half of the 7,500 capacity Rodney Parade.   Average home attendances last season were 3,867 or 52 per cent of capacity.

Fans raised £40,000 for shirt sponsorship.  They will be allowed to choose the charity that appears on the shirt.
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