Economic Carnage and what it entails for Rangers

[buster. 5,194]

I see the transfer thread has been bumped with rumours of multi-million pound signings.

I think we need to get real and start to focus on the economic reality given the potential timescales on government restrictions being mentioned by some of the high Heid yins.

 

We´ve been posting significant losses despite large ST numbers and good revenue from European football..

Mechandise revenue is severly hampered by costly ongoing and longterm litigation against someone who wants us to suffer.

Commercial revenue is under threat because most business out there will have to recalibrate.

Broadcast money, or the contract as currently is, must be under threat if there is no football and post Covid19, will the league be downsized (eg. some part-time clubs in top tier).

Wage deferrals (rather than cuts) means more pain further down the road and less available for future budgets

 

The budgets of most fans will change as disposible cash gets more scarce and priority for most won´t be football.

Shareholders have been ploughing millions into the club for a number of years. How will their own business be affected by the economic carnage and could they not only continue but increase the amount of money essentially given to the football club?

Same goes for any share issue. How does the new reality impact investment plans.

 

As far as I know, Scottish football doesn´t have a League or Cup sponser and trying to find one now will mean lowering the number.

If other provincial clubs suffer and some go part-time, will ambitious footballers want to play in Scotland.

 

Nearly every sector of the economy in most parts of the world will be ripped apart as a pandemic lingers. Football isn´t going to get much sympathy.

 

 

I´m no economist (and would be interested for the views of those whose expertise is relevant to this) but it seems to me as if the very best outcome would be severe downsizing in the short to medium term. 

 

Perhaps a good time for youth players getting an opportunity.

 

Edited April 21, 2020 by buster.

[ranger_syntax 4,322]

Probably best if we start off by spending 5 million pounds on Ianis Hagi. 

 

I'm not sure how to spend the rest of the war chest.  How about the rest of you?

[Gonzo79 15,294]

I suppose we'll have to wait and see what's going to happen with this season ending, next season starting and season ticket purchases before getting too analytical about the economic impact on Rangers FC.

 

If Gerrard decides to keep playing Hagi wide, I think he'd be a bit of a waste of money.  His ability to pick a cutting pass is exactly what we've been missing behind the striker(s).

 

 

[buster. 5,194]

45 minutes ago, Gonzo79 said:

I suppose we'll have to wait and see what's going to happen with this season ending, next season starting and season ticket purchases before getting too analytical about the economic impact on Rangers FC.

 

If Gerrard decides to keep playing Hagi wide, I think he'd be a bit of a waste of money.  His ability to pick a cutting pass is exactly what we've been missing behind the striker(s).

 

 

For us, yes, we can speculate like we do for the football side but ultimately of course, it´s wait and see.

However, the boardroom and club financial planners can´t. I´d be interested to see what the finance experts amongst us have to say on this. @Bluedell @Bill @craig  (the BBC!!).

 

Ann Budge came in for a lot of criticism when she moved quickly to cut costs but IMO whilst her calls on the football side have occasionally been dubious, she was right to take immediate measures on this.

 

We´ve already had a debate of sorts regards Deferrals v Cuts....but that initial decision has already been taken and the revised numbers could be fed into any future analysis.

 

As for Hagi, I don´t think it would be wise to commit the 4 or 5 million sterling at this point in time.

You could say, sell X and Y, raise the money and spend but transfer values have just been diluted and it appears the proposed fee for Hagi is fixed.

 

Good time to get Saudi owners in (I doubt the price of oil will stay where it currently is).

Could we use Auchenhowie to store millions of barrels of crude to sell at a later date ?

 

 

 

Edited April 21, 2020 by buster.

[Gaffer 1,665]

If this lockdown continues for another month, our economy will not recover for at least six years.  Lets face it, the way the government is talking, this will not lift any time soon so we do need to brace ourselves for a very hard few years.

 

We won't see the full impact of this for another 12-18 months though so it may be that businesses get back to some degree of normality for a while, but as the capital in companies dries up, and as the job losses begin, there will be the usual snowball effect you get in a depression.

 

I've made no secret of the fact that I am in disbelief and horror at the approach the government is taking with this lockdown (and I know they're not alone), so they will carry the responsibility of killing businesses, lives and sport.

 

I hope the club is working on plans to cut costs deeply if required.  The next few years are about survival rather than anything else.  I can't see the board being in a position to keep funding the club when their own businesses are coming under heavy pressure too.  If ever we should be relieved to have an accountant like Robertson at the helm, it's now.  I just hope he is a magician too though because we need more than one rabbit to be pulled out of the hat.  One major thing we need to be working on is how to ensure that the club gets all the available funding from our own fans rather than allowing it to be diluted across the other clubs.  Many of the other clubs will go out of business anyway so there's no point in the SPFL, SFA or governments stepping in to help them.  It's just delaying the inevitable.

 

 

[buster. 5,194]

19 minutes ago, Gaffer said:

If this lockdown continues for another month, our economy will not recover for at least six years.  Lets face it, the way the government is talking, this will not lift any time soon so we do need to brace ourselves for a very hard few years.

 

We won't see the full impact of this for another 12-18 months though so it may be that businesses get back to some degree of normality for a while, but as the capital in companies dries up, and as the job losses begin, there will be the usual snowball effect you get in a depression.

 

I've made no secret of the fact that I am in disbelief and horror at the approach the government is taking with this lockdown (and I know they're not alone), so they will carry the responsibility of killing businesses, lives and sport.

 

I hope the club is working on plans to cut costs deeply if required.  The next few years are about survival rather than anything else.  I can't see the board being in a position to keep funding the club when their own businesses are coming under heavy pressure too.  If ever we should be relieved to have an accountant like Robertson at the helm, it's now.  I just hope he is a magician too though because we need more than one rabbit to be pulled out of the hat.  One major thing we need to be working on is how to ensure that the club gets all the available funding from our own fans rather than allowing it to be diluted across the other clubs.  Many of the other clubs will go out of business anyway so there's no point in the SPFL, SFA or governments stepping in to help them.  It's just delaying the inevitable.

 

 

Interesting and a somewhat scary post, Gaffer !

You point to delayed effects (12-18 months) but for football, what state are Scottish football clubs in 8 months, if there is little revenue ? And specifically, us ?

 

I guess one of the main difficulties for economists interested in an objective assessment is that there is no historical  precedent to use for comparison or model on. It´s increasingly looking like new and genuinely scary territory.

 

 

[Bluedell 5,625]

When will football be back up and running?

Will there be social distancing within the stadium, which will have a major impact on crowds and season ticket sales?

 

2 unknowns and a difficult situation for the club. 

 

I'd be stunned if the club do buy Hagi. Surely we don't have the cash for that.

 

The current crisis is a game changer and we will have to watch every penny, particularly as we have little cash coming in but over £1m/month flowing out and then a big bump in July when we have to pay the deferred salaries.

 

As you say, Buster, it's a scary time.

 

[Gonzo79 15,294]

27 minutes ago, buster. said:

what state are Scottish football clubs in 8 months, if there is little revenue ?

After 2012 and the recent vote, I must say I care far less than I would've a decade ago.

[buster. 5,194]

20 minutes ago, Bluedell said:

When will football be back up and running?

Will there be social distancing within the stadium, which will have a major impact on crowds and season ticket sales?

 

2 unknowns and a difficult situation for the club. 

 

I'd be stunned if the club do buy Hagi. Surely we don't have the cash for that.

 

The current crisis is a game changer and we will have to watch every penny, particularly as we have little cash coming in but over £1m/month flowing out and then a big bump in July when we have to pay the deferred salaries.

 

As you say, Buster, it's a scary time.

 

Given my location, I haven´t been to Ibrox for a while but would you or anyone say the demographics within our support point to a fair proportion of retired gentlemen attending ? Surely they will be considering the risks involved with anything other than social distancing until a real solution is found.

 

That said, I guess OAP tickets/ST´s represent a lower revenue number/potential loss.

 

Whilst on demographics, I wonder how the younger generation react to this.

We have supporters not far from leaving school age who haven´t seen us lift a trophy. If Scottish football heavily downsizes, it´ll be a challenge to keep a hold of them all, at least as future fans who actually attend and invest, so to speak.

Edited April 21, 2020 by buster.

[compo 7,042]

If it was up to me there wouldn't be a single minute of football played in this country as long as there is a single  case of this virus as for transfers I think clubs will be making lots of short term loan deals and as for Hagi it's to big a risk at this moment in time , not unless we can sell the club to some richer than rich Arab lot like the magpies.