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55 percent of Europe's footb
clubs spend more than
they earn
by Steve Menary
At Soccerex 2011, UEFA’s head of club licensing
Andrea Traverso revealed that the annual review
of Europe’s top clubs was expected to show
losses of 1.6 billion euros in 2010 – up from 1.2
billion euros in 2009.
Speaking at Play the Game, UEFA’s benchmarking
manager, Sefton Perry, did not confirm
that figure but admitted that the 2010 losses will
be “worse again”, and he revealed that accounts
for one in 10 clubs produced comments from
their auditors that the club was a “going concern”.
Perry also revealed that of the 650 clubs in the
annual report, 230 suffered a drop in attendances
of five percent or more, and although 130 clubs
saw a rise in attendances, the overall picture was
“slightly negative”.
Clubs continued to drive revenue up with
2010 expected to show an increase in turnover
of between five and 10 percent. However, only 45
percent of the clubs in the annual review broke
even. The remaining 55 percent posted a loss.
“Incomes have tripled over the last 13 years
but it’s not about income, it’s about controlling
costs,” said Perry. “Financial Fair Play (FFP) is not
an answer to all these problems but we think it
will help.”
31 clubs already excluded
UEFA has already written to a number of major
clubs about the introduction of FFP, which will
not cover clubs with an annual turnover of less
than 5 million euros.
According to Perry, 31 clubs from places including
Bulgaria, Greece and Spain have already been excluded
from the Champions League or Europa League for failing
to meet the current UEFA club licensing criteria, and
he said that the European body would confront clubs
trying to evade the introduction of FFP.
“We are not scared of the legal ramifications, nothing
difficult is easy,” he added.
Stefan Szymanski, Professor of Sport Management
from the University of Michigan and the co-author of
‘Soccernomics’, responded by claiming that football remains
a resilient business with 68 insolvencies at clubs
in the top four divisions in England since 1982. Only two
clubs had been killed off: Aldershot and Maidstone.
“Football is a far more stable business than any other
UEFA revealed fresh details on
Game ahead of the introduction of
www.playthegame.org
Professor Stefan Szymanski (left) believes football clubs to be stable busin
and Tourism at Coventry University, J
on earth,” claimed Szymanski. “This is because when a
club goes under, the creditors don’t want the club to
fail.”
He went on to brand this as “immoral” and said that
the owners of failing clubs who took advantage of creditors’
affection for a club were effectively “stealing”.
Football serially unstable
John Beech, Head of Sport and Tourism at Coventry
University, challenged Szymanski’s claim that football
was stable, showing that 58 clubs have been involved in
71 insolvency events since 1991 with some clubs insolvent
on three occasions.
“Football is serially unstable,” said Beech, who also