Guest Post from DannyUK.com
There was a recent tweet doing the rounds which detailed why a football club in Germany had such low season ticket prices. The tweet was a quote from Uli Hoeness who is president of Bayern Munich – a German team that can rightfully call itself one of the biggest and best in Europe.
Talking about the low cost of their season ticket prices – in particular for a standing season ticket (which we don’t have available in the UK) costing just £104 behind the goal, Hoeness said…
“We could charge more than £104, let’s say we charged £300. We would get £2m more in income but what is £2m to us? In a transfer discussion you argue about that sum for five minutes but the difference between £104 and £300 is huge for the fan. We don’t think that the fans are like cows who you milk. Football has got to be for everybody and that is the biggest difference between us and England.”
The quote has got the UK football community talking, and it made me think how it would affect my own club, West Ham. West Ham are – as they will tell everyone and anyone at any given opportunity – a club in debt. The present owners took over a few years ago and vowed to get £100m worth of debt (well, £100m give or take a few million) down over the next few years. To their credit, they have started doing this successfully, while still breaking the club transfer record more than once. In the 2013 accounts the net debt figure for the end of the year was quoted at £77.4m. I should note that all figures hereon in are taken from the same accounts which can be found online here.
However, let’s do some maths here. The lowest price Season Ticket at Upton Park is £640. The highest, £910. Obviously we are only talking about adult ticket prices here.
The ground currently holds 36,000 supporters, and is generally a sell out for the majority of games.
West Ham have mentioned in the past that they have 20,000 season ticket holders However the official 2013 accounts show “season ticket and other receipts in advance” brought in £8.5m, which is the figure I will work on.
This season the lowest price season ticket at Upton Park will cost £640, and the highest £910.
My initial thought was that if the cost of these tickets were halved, it would mean that the season tickets would cost between £320 and £455 each – An absolutely vast saving. Naturally this would result in a loss of revenue for the club of around £4.25m.
The club’s response to this would be no doubt to restate how much in debt the club currently are. It’s interesting to point out that the shareholders (of whom David Sullivan is the sole majority shareholder, and David Gold holds the second highest amount) currently receive £2.3m per year on interest payable from loans.
Now I’m not denying the good that the two Davids have done for the club. I am firmly in the “they are good for West Ham” camp, which I know is the opposite to many fans. I’d be inclined to suggest that if they are in it for the love of the club though – which is another oft-spoken line – are they not able to provide the loans interest free?
I appreciate that the value of the loans (£45.7m) is huge, and that they would be able to make a profit elsewhere had they invested the money wisely. My issue is that they keep saying they aren’t in it for the money. That £2.3m per year – if knocked off the price of season ticket prices – could reduce prices down to £397 for the lowest and £565 for the highest.
Although that’s not the half-price that I initially thought about, it still makes the season tickets much more affordable to fans. This in turn grows the fan base and protects the long term future of the club.
If you want to look elsewhere for savings, consider that the directors are receiving almost £2m per year, which isn’t part of a total of £49.2m paid out in wages and salary. A further £1.36m went towards Olympic Stadium project costs, which you can argue will either not be ongoing, or will be swallowed up by the increase in revenue of taking over the stadium.
This is without touching on the massive Sky sponsorship that comes in. £51.8m was the figure quoted under “Broadcast and central sponsorship deals” – a figure that is set to rise when the new round of Sky sponsorship begins.
I know that this article may come across as a little bit of board-bashing, but it’s really not meant to. As I’ve already said, Gold and Sullivan took the club on when we were extremely down on our luck, and have done extremely well to keep us alive, much less begin to turn the tide.
I’d love to see them turn around and write off interest on loans, and reinvest that money into reduced season ticket costs. I dare say that they could afford to do that whereas the average fan will struggle to pay out the high costs of the tickets.
However, I would much rather see the money diverted away from players and agents to be put towards ticket prices. This would involve a massive undertaking by all professional clubs and the FA. No one club could choose to restrict the wages they offer without running the risk of losing out on players to a team that hasn’t taken up that remit.
Financial Fair Play offers a step in the right direction, though already people are questioning how well that will succeed.
In the meantime I’ll use this as an open letter to the board. I apologise if my sums are wrong or my assumptions are incorrect. I’m not an accountant and there will be hundreds if not thousands of people far better qualified to look through the accounts and come up with suggestions.
But even if my calculations are out. Even if they are completely and wildly wide of the mark, the sentiment remains. Bringing down the cost of season tickets is – must be! – somehow viable. Doing so would strengthen relationships between fans and board members, encourage people to come along to the ground more often and build our future by doing so.
Until such time that safe standing becomes a real option in the UK, which should see a natural reduction in ticket prices for those areas, the price of tickets needs to be looked at. Season Tickets seem the ideal place to start.
Visit Danny’s site at dannyuk.com