Money, money, money

During Nigel Clough’s post-match interview on Radio Derby, he was pressed by Colin Gibson about Derby’s transfer kitty. Like a dog with a bone, Gibbo refused to accept Clough’s diplomatic answers and kept pressing on, comparing our spending to how much Forest and Leicester were spending. It’s a common complaint amongst some fans and Radio Derby seem to beat the drum on this one; pre-Millwall they also discussed “should a club like Derby be able to afford a £2m player?”.

Gibson is a massive Rams fan and a knowledgeable bloke, so I was surprised with his line of attack. It’s been well documented that Forest have been subsidised to the tune of £5m a year for the last decade (£12m last year), whilst Leicester’s budget has seen them employ one of the world’s most famous managers and pay a rumoured £35k a week for Yakubu. Derby’s current owners have never promised to do that.

Another line is always “we get the biggest crowds in the league”. Okay, lets look at the top 3 crowd-pullers in the division: Leeds; us; then Norwich. Leeds have recently signed George McCartney on loan from Sunderland, saying that the FA Cup money has allowed them to do this. Norwich’s last signing was a 31 year-old from MK Dons (although the chairman is talking of a calculated gamble on promotion – just in case they spend a load soon!) Having a few thousand extra fans doesn’t mean you can spend millions on players. The only thing that does is someone simply giving you cash, as with Forest, Leicester and Hull.

Stories of Bristol City, Watford and Sheffield United all posting losses of over £10m shows that you don’t have to go crazy to rack up huge debts. The concept of “investment” in football is a bit of a myth as it’s difficult to ever take the money back. You may be lucky and sell the club on (e.g. Madaric or Shinawatra)  or you might just have to write off all or part of your investment (Liverpool, West Ham, Chelsea, Middlesbrough, Newcastle…very long list).

What you need is someone to actually give you money a la Lionel Pickering. The crazy thing is that fans (of all clubs, not just Derby) actually expect someone to routinely come along and do this. The penny is starting to drop for many clubs and we’ve had several emails at ramspace from people saying that the Rams are two years ahead of most clubs on this. The problem is, just like the economy, its more fun when you’re throwing money around (not a sign of political approval by the way, I’m being shafted by the Con-Dem-Nation).

If the board left tomorrow, they would probably be the first owners in my living memory not to have left a financial car-crash behind them. The GSE ownership is slightly different as we are not any one individuals plaything or vanity project. We are being run like a business with all the constraints of a business not wanting to lose money. It probably sounds like I’m preaching on behalf of the board here – I’m not. It would be great if they decided to boost the transfer kitty and it hurts to see Forest throwing cash around. We’re metaphorically having to stay in on a Saturday night, whilst the Red Dog’s are maxing-out someone else’s credit card. It’s not fair but that’s life. Maybe you have a few million spare Gibson? Thought not.

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Posted on January 23, 2011, in Uncategorized and tagged , , , . Bookmark the permalink. 6 Comments.

  1. Pretty much in agreement with everything you’ve said, but to put things into perspective financially, if we paid £350k for Ben Davies then HALF of that money was covered by the 4000+ Forest fans who paid over £30 a ticket on saturday..

    OK so that’s a rough calculation but you get my drift. If Leicester bring a similar amount then that’s effectively our ONE permanent signing in the window funded by away fans gate receipts, not investors

    • I think your point makes me realise that a couple of Cup fixtures wouldn’t have gone amiss this season. 20-30,000 paying punters (instead of season tickets) plus prize money and maybe TV cash (Notts Co are getting £350k for being on against Man City).
      As for Bamba, Sven must have clocked him during his Ivory Coast stint. Having googled him, I was met with “I’m pregnant by Hibs star Sol Bamba says lapdancer” and “Hibs star goes AWOL”! Clough has said there’s value to be had in Scotland so maybe time to pull one out the bag.

  2. See also Leicester – £250k for defender Sol Bamba from Hibs – 3 goals in 4 games!

  3. However frustrating it may be at the moment (and it is – and I also feel those frustrations) the fact is that we are now in a much healthier financial position than we were two years ago (our wage bill for example has reduced from £23millioons to £9 millions) and in a much better position than most other teams. At a time when the majority of Premier clubs appear to be trading in deficit or VERY small surpluses, encumbered by massive debts (some related to the ambitions of owners who used this debt to leverage ownership of the club) and when the majority of Championship clubs are similarly afflicted with very high debt burdens and very low profitability, this is something we need to be permanently mindful of.

    I know GSE is an investment vehicle and they have to show a return, but this does not necessarily mean they are bad for the club. The strategy is one of gradual development and in Nigel they have the manager who will pursue this line. I know that this is frustrating, and that the current playing staff appears only marginally improved upon what we had this time last year, but, as you build, you sometimes experience backwards steps – improvement isn’t always linear I’m afraid!

    My only concern is that they may be a little too risk-averse – sometimes you also have to accept that expenditure-control can be obsessive for an organisation, and some carefully judged relaxation is necessary at times – I believe that we are at such a moment, but the overall financial strategy must not be jeopardised.

  4. Got to agree with the points made, you’ve got to be careful spending extra gate receipts on transfer fees if you’ve not got the cash to cover the wages. As long as Clough continues to frustrate Gibson he is well worth sticking with, what a moaner, if Carlsberg did jobs…

  5. You may not appreciate a Forest fan contributing here but I have a lot of respect for at least the concept of getting the club living within its means – assuming that this is the genuine intention as part of a development strategy for the club. I do not know your owners well enough to say whether that is the case or not.
    With clubs threatened with closure on a weekly basis at the moment and fans of Plymouth and Kidderminster starting “Save our Club” campaigns in the last couple of weeks there has to come a time when fans and football authorities wake up to the financial mess within the game.
    It is isn’t nice to watch the team suffer on the pitch whilst doing these laudable things off it but it does have merits. I wrote about it on my blog at the link below if you’re interested at all at in a view from down the road.

    http://mistrollingin.wordpress.com/2011/01/28/forest-derby-the-cloughs-and-me/

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