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    Assumptions about the investment

    I don't want to come over as a pessimist but why are most people assuming that we will go out and buy several expensive additions to the playing staff?

    I was thinking about the possible investors and considering why they would buy the club - for financial or prestige reasons, or as a plaything?

    If its financial they want a return on investment and how do you generate more income - three ways I see.
    1) More prize money. Each place in the Prem is directly worth about £1M (I think) so moving from third to first is no great shakes. In cup competitions it's a lottery and an an expensive squad doesn't mean you will win any of them (although it helps I know) - so getting into say the last 8 is as good as you can assume, and while we often do that now, perhaps another 1 or 2 class players would make this more certain. Note though, that's a hell of an expense with little direct reward.
    2) Direct income from match days. An increase in ticket prices would be unpopular (but perhaps inevitable) but the new stadium would bring in much more money - but the pay back on the stadium will be say 10 years (depending on ticket prices and gates I know). Still the Stadium is the best way to guarantee income.
    3) Merchandising. To increase merchandising you need more fans. It seems natural that being owned by DIC would bring more middle eastern fans (irrespective of increasing the success above what we have now). Additional fans numbers based on success would be fair weather fans like Chelsea's and that market will ebb and flow. Additional fan spending based on success is surely the biggest potential market and this (probably) depends on cup success - as I said earlier a lottery.

    Now success obviously does bring income but on a purely financial basis spending like Chelsea's is unjustifiable on commercial grounds and ManU's is only possible because of how there fan base grew as the Premiership's grew.

    If the investment is for prestige then it is a bit more hopeful that DIC will invest in the team.
    I wonder how they will see the obvious lesson from Chelsea - buying big makes you unpopular with everyone but your own supporters. I hope that doesn't happen to Liverpool.
    I suspect that more prestige will come to the club if it continues to be financially prudent and tries to fund success through it's own income. If DIC agree with this then (the obvious) spending on players will be more gradual and not so excessive. Yes, plug one or two holes initially but then take a back seat.
    Certainly for prestige we may expect another genuinely world class player for profile reasons but where, and at what price? Chelsea with their profligate spending still have holes in their team and can't get hold of some of the players who fit the description 'world class'.

    If the club is to be a plaything (and I don't for one moment think it will be) expect loads of money to be spent, ex-chav supporters to join our ranks and many true supporters to go very quiet.

    One other thought, perhaps it is in the nature of DIC to invest in the future which would mean more young talent at the club rather than experienced players. Young players who will need time to settle and won't give success immediately. I suspect this approach is more in keeping with what has been happening over the last couple of years and is perhaps more in keeping with Rafa's current thinking.

    To anyone who has made it this far, whatever happens I just hope that we don't turn into massive spenders, do develop our own players, are not a 'win at all costs' club but go on to more success with dignity.
    Luck - the only substitute for skill

    #2
    You forgot TV revenue.

    I can see in the future each team negiotiating their own tv deals like the italians.

    Thats why so many foreign people are investng in premiership clubs now imo.
    In Rafa I Trust

    Comment


      #3
      no great shakes


      We can certainly make more money from a new ground and merchandising (that is certainly crap at the moment), but I don't think Rafa, even if he was given the freest of reigns would automatically splash the cash.

      Over the longer term, at a successful club, money can be made. I hope that's what they're after.

      Comment


        #4
        Even if TV revenue in the UK is not negotiated seperately, there is a huge market out there for TV and Internet rights across the world. AnfieldTV would be an obvious move too. There has to be a vast potential in marketing improvements too, since the club is horrible at that, both selling stuff and using players images to advertise around the world.

        I did hear a financial guy on the Today programme this morning saying that offering the Bluenoses a groundshare would bring in a lot of revenue, but I do hope not.

        Comment


          #5
          I know that it has been stated that the new ground beeing built is part of the takeover deal, but I find it suprising that coming from a country that is expanding at a rapid speed that they would build a stadium of such a design in an area that will not allow for future growth.

          Comment


            #6
            Originally posted by Angry Dan View Post
            I know that it has been stated that the new ground beeing built is part of the takeover deal, but I find it suprising that coming from a country that is expanding at a rapid speed that they would build a stadium of such a design in an area that will not allow for future growth.
            It to do with transportation links.

            But i agree it is a bit pointless building a new stadium that will not allow for future growth.
            In Rafa I Trust

            Comment


              #7
              Originally posted by hertsred View Post
              Even if TV revenue in the UK is not negotiated seperately, there is a huge market out there for TV and Internet rights across the world. AnfieldTV would be an obvious move too. There has to be a vast potential in marketing improvements too, since the club is horrible at that, both selling stuff and using players images to advertise around the world.
              I remember reading on another board that Manures TV channel looses money each year (and although I don't know if that is true the posters discussing it seemed to be confident of their facts). Other than SG which players do we have who's image we could make the most of? JAR in Norway (tiny market), Agger in Denmark (even smaller), Xabi and Luis in Spain (OK that's true). This kind of merchandising/marketing we could do better now without a take-over.

              Originally posted by Angry Dan View Post
              I know that it has been stated that the new ground beeing built is part of the takeover deal, but I find it suprising that coming from a country that is expanding at a rapid speed that they would build a stadium of such a design in an area that will not allow for future growth.
              Really good point - does the planning permission that the club now has mean that it would take too long to change anything - I suspect so?
              Someone else suggested that development could happen near the ground - like Anfield Plaza
              Luck - the only substitute for skill

              Comment


                #8
                Some thoughts on your three points:

                1) There isn`t much difference finishing as no. 2 or 3 in money from the FA, but it makes a big differnce in what you get from CL.

                2) `With a new stadium comes new "possiblities". Like in the company I work for (in Norway) there was a competition. The first price was a trip to see the Scum, in a lounge. i`ve also see this price other places over here. I`ve never seen watching LFC being a price. So when it comes to things like this we`re a long way behind the Scum.

                3) I think the fanbase is there, the club just isn`t capitalising on it. Didn`t we just recently open first out-of town shop, in Chester? You can find Scum stuff everywhere.

                The potential is there for the club, but we need competent personell running this part of the club as well.
                Blank

                Comment


                  #9
                  Originally posted by Resu View Post
                  1) There isn`t much difference finishing as no. 2 or 3 in money from the FA, but it makes a big differnce in what you get from CL.
                  Yeah but the CL is a cup and both Porto and Liverpool will tell you that expensive squads don't guarentee success

                  Originally posted by Resu View Post
                  The potential is there for the club, but we need competent personell running this part of the club as well.
                  Perhaps thats where DIC will make some of their most important changes in respect to the clubs finances - I hope so
                  Luck - the only substitute for skill

                  Comment


                    #10
                    Real Madrid got over £600m for their latest Tv deal. I can imagine that the big clubs in the PL won't agree a new TV deal because of the kind of money they will miss out on.
                    Just believe and you never know what will happen.

                    According to Benitez it's important not simply to go out to win but to go out prepared to win, which means players have to put in the same level of work on a daily basis. Anything else is unacceptable.

                    Comment


                      #11
                      [QUOTE=OldManRed;185791]Yeah but the CL is a cup and both Porto and Liverpool will tell you that expensive squads don't guarentee success


                      But if you get into the CL group stage you`re guaranteed a certain amount of money, and the amount of money is tied to your league position.
                      After that it`s a cup, and you get money depending on how far you get.
                      Blank

                      Comment


                        #12
                        I think a lot of people have missed the point that it is not possible to make a profit in football, the exception being - buying a club at price A, then selling at price B (higher than A). For example Ken Bates bought Chelsea for £1 in the 80s, and sold it to Abramovich for millions.

                        The reason it is not possible to make money from football is that all money generated by clubs is reinvested in the squad (or sometimes training / stadium facilities, but this is usually borrowed).

                        The more money a club make, means the more they spend on transfer fees and wages. If they don't do that, they will decline. Fans would also see this as being unaccaptable.

                        The next TV deal will be worth significantly more than ever, and the whole lot will be blown on transfers and wages. We'll see how many clubs would have made a profit for their owners.
                        Oh I don't know.

                        Comment


                          #13
                          Originally posted by dom9 View Post
                          I think a lot of people have missed the point that it is not possible to make a profit in football, the exception being - buying a club at price A, then selling at price B (higher than A). For example Ken Bates bought Chelsea for £1 in the 80s, and sold it to Abramovich for millions.

                          The reason it is not possible to make money from football is that all money generated by clubs is reinvested in the squad (or sometimes training / stadium facilities, but this is usually borrowed).

                          The more money a club make, means the more they spend on transfer fees and wages. If they don't do that, they will decline. Fans would also see this as being unacceptable.

                          The next TV deal will be worth significantly more than ever, and the whole lot will be blown on transfers and wages. We'll see how many clubs would have made a profit for their owners.
                          I'm sorry, but I don't agree with you on that.

                          For example, Manchester United (before Glazers) made a nice healthy profit year after year, even though their wage budget would have been the highest in the land, and they spent large sums of money in the transfer market and on the stadium. How did they generate a profit?

                          Having a sold out stadium, game in game out, having a corporate entertaining section the envy of other clubs, and importantly having a shrewd and expansive merchandising/commercial structure that generated millions a year.

                          Most clubs will struggle to make money - but there is no reason why LFC shouldn't start making money if the stadium and commercial aspects are expanded.
                          James Philip Milner Fanclub #1

                          Curtis Julian Jones Fanclub #1

                          Comment


                            #14
                            The 'profit' united generated was reinvested in the club, be it the squad, stadium or training ground.

                            The fact they were able spend so much money was because of the 'profit' the club made.
                            Oh I don't know.

                            Comment


                              #15
                              So why would DIC invest in the club - money, prestige or as a play thing?

                              I think I'm coming down on the side of prestige and I hope this means restraint.
                              Luck - the only substitute for skill

                              Comment

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