Fighting for survival? The financial management of football clubs outside the ‘top flight’ in England

Abstract

There has been an increasing interest in the ‘business’ of professional football in recent years, with a number of refereed journal articles and edited and single-authored texts addressing the subject. However, almost all of this activity, which is largely UK based, has focused on the ‘elite’ end of the business: namely, the FA Premier League. This paper addresses the very different business and financial management issues faced by those professional clubs outside of the ‘top flight’ in England. It does this by examining the range of potential and actual management responses of clubs to financial pressures, prior to an analysis of a lead case study of Lincoln City FC, which has emerged relatively successfully from a period in administration, supplemented by perspectives from other clubs that have entered administration in the last ten years. In conclusion, the paper discusses some of the barriers facing clubs in adopting sustainable financial management strategies, and discusses the potentially central role that the Supporters Trust movement can play in ensuring financial prudence.

Notes

1. This research was conducted while Ross Emery was at the Institute of Sport and Leisure Policy at Loughborough University. It is in no way associated with, nor necessarily endorsed by, KPMG.

2. The Football League (i.e., those divisions outside the Premier League/Premiership) has undergone a number of name changes as a result of changes in sponsor over the last few years. Most recently, as a result of Coca-Cola's sponsorship, the former Divisions 1, 2 and 3 of the Football League have been renamed the Championship, League One and League Two. For simplicity and consistency, for the remainder of this paper the term ‘the Football League’ will be used to refer collectively to these three divisions, whilst the current terminology of ‘the Championship’, ‘League One’ and ‘League Two’ will be used to refer to the individual divisions, regardless of their name at the time being discussed.

3. We are grateful to, and acknowledge the contribution of, Mathew Everett, who collected the data from Hull City, Oxford United and Wrexham as part of his undergraduate dissertation in the School of Sport and Exercise Sciences at Loughborough University—see Everett (2005) in the reference list.

4. A Creditors Voluntary Agreement (CVA) is an arrangement drawn up by the administrators, the business and the creditors regarding the settlement of outstanding debt. Once agreed to it can become legally binding for all parties and this can act as a means for a club to exit administration.

Additional information

Notes on contributors

Ross Emery

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