Chris Callaway’s Post

Financial Overview: The State of Premiership Rugby in 2023 With all the clubs having now released their FY23 financials, let's take a look at the state of Premiership Rugby's finances. The latest reports show that, despite fiscal safeguards such as the salary cap, none of the league's clubs turned a profit, raising concerns about its financial sustainability. 🔍 Key Highlights from My Latest Blog: • Salary Cap Evolution: The salary cap has been pivotal for competitive balance since its introduction in 1999. However, its upcoming increase to £6.4 million for the 2024–25 season poses further challenges. • Revenue Streams: All clubs faced revenue shortfalls relative to operating costs. Harlequins led the revenue charts at £26.8 million, while Saracens recorded a significant loss of over £5 million, reflecting the financial strain. • Wage-to-Revenue Ratios: Rising salaries have strained the clubs, with some ratios exceeding 70%. However, with proactive measures to manage costs, diversify revenue streams, and grow the grassroots playing base, there's hope for sustainable progress. Take a look and let me know your thoughts! #PremiershipRugby #SportsFinance #SustainableRugby

English Premiership Rugby club finances are baffling to me! Brilliant article below from Ben Gauna outlining the Premiership Rugby clubs P&Ls for 2023. Average club revenue (between £11m - £26m per season) is equivalent to the larger EFL (English Football League) League One or smaller Championship clubs. And these football clubs have much higher annual wage bills to deal with. Player salaries typically make up 80-90% of these clubs' annual revenues. Broadcast revenues at this level are not the same as the The Premier League clubs. As outlined in the fantastic Twitter thread from Ryan Shahin below. https://lnkd.in/dPhYVwC6 For me, the focus in rugby clubs is too often about growing new revenue streams. But whilst some revenue growth can be achieved by individual clubs (congratulations Harlequins and Saracens for impressive commercial revenue growth), the significant growth needed is collective, and driven by fan demand, building the 'product', macro-economics and the competitive landscape for attention. Not directly controllable by individual clubs. So with a salary cap in place, the route to profitability for most clubs should be about strategic cost management first. I find it astounding that the leading revenue clubs that have salary caps in place can make such significant losses.

https://lnkd.in/eRzUfdeR Who will save England Rugby? If Bill Beaumont is the answer then I really do not believe anyone has fully understood the questions and challenges facing England Rugby. Removing the CEO and Chair of England Rugby is necessary but someone to 'steady the ship' is not any help to any rugby stakeholder unless you really think the status quo needs to prevail. Like it or not England Rugby is a business with a set of core products of rugby union accross multiple variations. They create seperate funding streams with seperate and overlapping consumers via multiple platforms. Sound like boring, corporate speak to many supporters and some players? It is. But a failure to understand and nause it up and you leave the game on the edge...just look at the last season or so. Even a significant Rugby World Cup performance made barely a dent. Minimum skills: -Funding and financial plans. -Commercial strategy and TV rights planning. -Digital media and image rights exploitation. -Organisational transformation. -Multi level understanding of the English game. -Understanding how the game needs to develop to remain attractive and safe. -Negotiation planning. And an ability to be able to persuade multiple commercial, investment, playing and supporter stakeholders of the benefits of long term planning. Fixed term contract. Results based. Candidates please step forward and start talking. We may not be talking about saving England Rugby and the game. It will survive, but it should thrive and grow for future generations. When the game turned professional the transition was a dogs dinner. Do not make the same type of mistakes again at this critical juncture.

🚨How Sporting Directors are saving up to £100K per year 🚨👇👇 Signing a non-league player can be a very useful method of managing the B team / U21 wage bill. A 16-20 year old non-league player on a steep upwards trajectory with 30-50 senior appearances will cost £350 - £500 p/w basic salary. This player provides an inexpensive alternative option to a player released from a Cat 1 on a downwards trajectory asking for £1,500 - £2,500 p/w. A non-league player is experienced at senior level, has different experiences away from the academy system and would grab the opportunity of full-time football. If the non-league player fails to break into the first team, it’s a £18,200 - £26,000 p/a loss on investment via the player’s salary. Compare this to a released Cat 1 player on £78,000 - £130,000 p/a. The risk is much smaller on a non-league player and there is potential for a steeper upside. #NLG

Munster were victorious with a win over Saracens in Thomond Park, despite recent dips in performance and a number of injuries in the squad. In 2019, Saracens were found to have breached Premiership Rugby's salary cap regulations by deliberately understating player salaries. The Saracens Rugby Club salary cap scandal involved the club allegedly paying players amounts exceeding the Premiership Rugby salary cap limit. To circumvent these regulations, it's believed the club employed various methods: 1. Loaning players to affiliated companies: Players were ostensibly "loaned" to companies connected to the club's wealthy owners. These companies then paid the players significant sums, effectively boosting their overall compensation while keeping the amounts off the club's official salary books. 2. Benefits in kind: Players may have received substantial benefits beyond their stated salaries, such as luxury cars, expensive housing, or other perks. These benefits were not accurately reflected in the club's salary cap calculations. 3. Image rights payments: Players may have received significant payments for their image rights through entities associated with the club, further inflating their overall compensation. These methods allowed the club to field a highly competitive team while technically staying within the letter of the salary cap rules. However, they ultimately led to the club's downfall when the breaches were uncovered. Up Munster!

Am I alone in seeing some uncanny parallels here? A CEO for whom pay and bonus are far more important than the job that he was hired to do; the organisation that he is in charge of being a complete basket case while on his watch; a fatally flawed LTIP (long term incentive plan) with targets that seemingly have no relationship with the performance of the company; payment out of a huge bonus notwithstanding the organisation being on its knees; loyal servants of the organisation made redundant or treated like second class citizens. I bet you think I'm talking about Nick 'Bonusgate' Read, the soon to depart CEO of Post Office Ltd who is quitting, and inexplicably as a 'good leaver' Stuart G. Nick Gould Ben Clover Lee Castleton Dr. Jason Price. But no - the subject of The Guardian article below is Bill Sweeney, the overpaid, underperforming, and massively unpopular CEO of the Rugby Football Union. Like Read, I think his goose is also well and truly cooked. So what's the connection here between two unrelated organisations led by these hapless and hopeless individuals? My view is that in order to flourish, any organisation needs a courageous leader who puts the interests of employees, other stakeholders, and the interests of the business before their own bank balance. In other words, exactly the opposite of these two so-called leaders. Would you agree Holly Cope and Helen Pamely?

🌟 𝗜𝗽𝘀𝘄𝗶𝗰𝗵 𝗧𝗼𝘄𝗻'𝘀 𝗣𝗿𝗲𝗺𝗶𝗲𝗿 𝗟𝗲𝗮𝗴𝘂𝗲 𝗣𝗿𝗼𝗺𝗼𝘁𝗶𝗼𝗻: 𝗔 𝗙𝗶𝗻𝗮𝗻𝗰𝗶𝗮𝗹 𝗚𝗮𝗺𝗲 𝗖𝗵𝗮𝗻𝗴𝗲𝗿! 🌟 After 22 years since they last played in the top flight league in the UK, Ipswich Town FC has now been officially promoted to The Premier League for the 2024/25 season. Here's a glimpse into the financial implications: 📺 𝗕𝗿𝗼𝗮𝗱𝗰𝗮𝘀𝘁𝗶𝗻𝗴 𝗿𝗲𝘃𝗲𝗻𝘂𝗲: TV Income forms a major chuck of the total revenue for a football club. TV Income for clubs playing in the Championship is approx. £10 million while last placed Southampton Football Club in the 2022/23 Premier League season earned £108 million from TV income. 🤝 𝗖𝗼𝗺𝗺𝗲𝗿𝗰𝗶𝗮𝗹 𝗜𝗻𝗰𝗼𝗺𝗲: Playing in the premier league may help the club with securing lucrative deals for the kit sponsorship. Average front of shirt sponsorship deal for a mid tier club in the Championship is £ 500k while that in the Premier League is £ 6-7 million. 🏟 𝗠𝗮𝘁𝗰𝗵𝗱𝗮𝘆 𝗥𝗲𝘃𝗲𝗻𝘂𝗲: Although the number of games played in the Premier League(38) are less than in the Championship (46), Ipswich Town can earn higher in Gate receipts mainly impacted by revenue share in the away games played in the Premier League. 💷 𝗣𝗹𝗮𝘆𝗲𝗿 𝗰𝗼𝘀𝘁: There will be a significant increase in the wage bill of the club. Players have clauses in the contract enabling them to earn higher wages in an event of a Premier League qualification. Moreover, in order to be competitive in the Premier League, the club will have to invest in top quality players leading to an increase in the wage bill. Average salary in Championship is £12-14,000 a week while that in the Premier League it’s £ 70-80,000 a week. This momentous return to the Premier League isn't just about football; it's a golden opportunity for Ipswich Town and the entire community. With strategic planning and prudent investment, this promotion can serve as a catalyst for long-term success, both on and off the pitch. Source: ITV News Kieran Maguire Picture Credit: Sky News #PremierLeague #Championship #Football #FinanceinFootball #SportsBiz #Promotion

Yesterday during our Business of a FIFA Football Agent module on the Football Transfer Market we discussed the impact of FFP now and in the future. An interesting question came up questioning why salary caps have never worked in professional football. Sports BE look into the demise of two notable salary cap experiments in football, discussing why they may not be the answer for the game. Read the full article here and join the conversation! https://lnkd.in/eBd2qiNe #FootballBusiness #SportsRegulation #FinancialFairPlay #FIFAAgents #FootballEnthusiasts #SportsBE #SportsBusinessEducation #FIFAAgentExam #FFAR

Premier League Looks To Be Closing In On Salary Cap: On Monday, the majority of premier league sides voted to finalise proposals for for a definitive spending limit for wages and transfers that would be linked to the revenue of the league’s poorest club. This system, known as anchoring, will be presented to clubs in June along with a full economic and legal analysis, where a formal vote to approve the plans could also take place. With growing numbers of investors now involved in the sport and weakening demand for live TV right, the game’s organisers have been exploring ways to end the cycle of overspending. UEFA have already introduced new rules barring clubs from spending more than 90% of their revenue on the playing squad, dropping to 80% next season and settling at 70% the season after. Whilst the Professional Footballer’s Association remain ardently against the plan, growing pressures from a multitude of angles perhaps make some form of cap inevitable. #premierleague #costcap #sportsbusiness #sportsfinance #football #sportfinance #footballfinance #uefa #pfa

Final call 📣 It's your last chance to enter this week's competition. You have until midday today to predict your score on the first match of the championship. How to enter: ⚽ Like this post ⚽ Comment your score prediction ⚽ Follow The Cinch Group #ItsComingHome #Euro2024 #football #summer #competition #GermanyvsScotland #scoreprediction #umbrellacompany #payroll #cis #construction #CinchtheWin