Why English Football Is Growing Financially
Every product needs to provide value to its customers which will make them come back for more. For the English premier league, their customers are the over 750 million people watching the most bankable league in the world in over 200 countries.
How did they get away from posing operating losses ten years ago, to have every team in the premier raising operating profit in 2018?
Football finance is managed judiciously by professionals who understand the market of balancing wages and revenue. For the first time in a long while, the wage/revenue ratio dropped to 55 percent as the premier league recorded a £4.5 billion income in the just-concluded season.
According to Deloitte, the five big leagues in Europe which are; France, England, Spain, Italy, and Germany are all worth £12.5 billion in the market. The English premier league made more money than the rest of the big five by posting 86% increase over its nearest rivals La Liga.
The European football market is worth €25 billion, but it didn’t just happen. After several years of marketing European leagues at home and across the world, experts have found a leading theory and fact why the English league is growing financially from strength to strength.
According to Deloitte, the five big leagues in Europe which are; France, England, Spain, Italy, and Germany are all worth £12.5 billion in the market.
UEFA fair play rule
The financial fair play rules adopted by UEFA in 2010 have gone a long way in making sure football clubs don’t accumulate debt. Going by the statue of the same body, it recognizes that clubs have a primary duty to their employees, other clubs, tax and creditors of the club.
For that reason, clubs have tried in the 7-8 years of its implementation, to balance their books. Failure to do so might result in a punishment like deduction of points, ban on transfer activity for a specified period, withholding of revenue for the team in Uefa competitions and many more.
Fair play measures have made clubs more financially disciplined, and this had impacted the English premier league.
Increase in broadcasting rights
The open bidding currently been expressed in the premier league have caused the broadcasting rights for premier league matches to cost more than other leagues.
Skysport, Bt sports, and some other media companies that indicated interest made the 2019 deal signed much lesser than what was approved in 2015. It means that currently, premier league teams earn more from the TV right deal in 2015 that was said to be ‘overpriced’ than what it will receive in 2019.
It has all contributed to why premier league teams are growing in operating profit than other places in Europe.
English clubs are known for their substantial sponsorship deals with brands both in and around the UK. As an international brand, it’s no surprise why Chevrolet an American company pays £40 million for the shirt sponsorship of Manchester United. The same amount can almost be seen for the Liverpool deal, as well as Yokohama a Japanese company sponsoring Chelsea football club of London jerseys.
If we combine that amount with the amount of money coming from ticket sales and memorabilia, it no surprise why football in the UK is bankable and Cashfloat gives loan to the people who require money in a career of football.