Clubs in the English Football League (EFL) could be facing a fight for survival as tightened coronavirus restrictions ended any hope of getting paying supporters through turnstiles in the near future.
The new measures announced yesterday by UK Prime Minister Boris Johnson put paid to the test events that have seen limited numbers of fans return to stadiums in recent weeks and given hope to lower league clubs that their main income stream was returning. Now, it may be as long as six months before supporters can attend matches.
Johnson addressed the nation yesterday to warn of the dangers of the virus spreading exponentially after a sustained rise in cases in England over the last few weeks. The country is now in something of a halfway house between the full lockdown of the spring and the relatively relaxed regulations of the late summer: pubs and restaurants are still open, but will be subject to a 10pm curfew, while mixing between households has been effectively ended except for under certain circumstances.
While there is no serious talk of halting play again in the Championship, League One and League Two, clubs at those levels have been dealt a serious setback as hopes of welcoming fans back were effectively halted until at least Christmas.
Rochdale, based on the outskirts of Manchester, are one such club. Last season, they managed to sell a youth player, Luke Matheson, to Wolves for a reported £1 million, which has insulated them a little against the worst of the COVID-19 financial scares so far. However, they do not need to look far to see the potential problems facing them: Bury, their near neighbors and greatest rivals, went bust pre-COVID and were expelled from the Football League, while Macclesfield Town, also near Manchester, were wound up at the High Court last week after 146 years.
“It was going to be a severe impact under the regulations that had been set out anyway,” said David Bottomley, CEO of Rochdale. “Under the regulations that we had been working towards for the last eight weeks, which have already cost us money to implement, we were looking at a loss of income from hospitality and reduced crowds of around £2m for a club that turns over between £6 and 7 million. That’s a third of our income.”
The lack of fans goes far further than just tickets and pies, says Bottomley. “With no crowds at all, particularly with hospitality, you’re looking at a vast part of our income being wiped out because everything relies on us playing football in front of crowds: all the sponsorship, all the advertising boards around the pitch. It’s almost academic that our gate receipts are only 15% of turnover, in terms of purely people coming through turnstiles. Even with restricted numbers it was going to be bad, but it’s horrific without any numbers at all. On Saturday, we made about £15,000 from iFollow (the Football League’s streaming service) but we would have normally taken over £100,000 for a game against Portsmouth.”
Given these new restrictions, all financial plans are out of the window. “You can’t budget at all,” says Bottomley. “We’re only surviving at all because of the fact that, for 113 years, Rochdale have been solvent and we’re coming off a financial year up to 2020 that should show a profit of around £1.5m. A couple of fortuitous things have happened on the transfer front in the calendar year 2020: one is the sale of Luke Matheson to Wolves, another is a deal that was done 12 months ago on a former player, Craig Dawson, going from West Brom to Watford (which incurred sell-on fees as Rochdale developed the player). That all helps, because there’s around £300,000 going out each month in wages and overheads.”
Bottomley is clear that collective action and assistance from the government is needed to stave off widespread financial issues in English football. “In common with every member of the EFL, including the Championship, we can’t survive unless some fundamental things happen,” he said. “The football industry cannot continue without crowds. The Premier League might be able to in the short term because of the TV deal, but if the economic situation worsens, it means that people cancel Sky TV subscriptions which means that Sky will reduce the monies that are going to the Premier League.”
“A lot of our sponsors have also faced tough times like everyone else, and Rochdale isn’t exactly the wealthiest town in the UK. Lots of clubs in Leagues One and Two face the same issues. There’s a huge elephant in the room, which is player salaries, and players have not taken pay cuts during the pandemic: even when they were furloughed, we were topping up massively. We had to put an announcement out to our fans, because many of them thought that our players were furloughed and that the furlough scheme was covering their salaries: it was absolutely not. In the period from March to July, we added nearly £700,000 on top of the government’s furlough scheme to top up wages.”
A longer term problem may also be a severance in the tradition of going to watch local football clubs, especially for clubs like Rochdale that sit in the shadows of clubs like Manchester United and Manchester City. “For our TV product, you’re relying entirely on goodwill from supporters,” says David Bottomley. “Rochdale v Fleetwood next Saturday is not a game that can be marketed like Manchester United v Brighton can be marketed by Sky. You’re not going to get many people outside of Rochdale and Fleetwood fans subscribing in to watch our game on TV. I think that a lot of people will get out of that habit of matchgoing, especially our older generation.”
“If I’m being brutally honest, that was one of the issues that was facing the club anyway. A lot of our white, male, over-70-years old fans will probably not come back to football. We’re already seeing that in season ticket renewals, as many of the 65+ age group have not renewed season tickets because they were concerned anyhow (about the pandemic). In the long term, it’s interesting because my goal is to make us a family club and the best family club at whatever level of football we’re playing at, but for now, I think a lot of people will have got out of the habit.”