Club Finances

[Mooro]

The squad budget is now pretty much a fixed cost in all this, as it will be pretty close to £900k. However, that is still larger than any other club in the division so we need to be able to use that to our advantage. To my mind, I agree with others on here 5 x £30k players will serve us better than 3 x £50k players.

One encouraging element is the age of the people we are now getting in, in that they are more likely to be on more reasonable wages, are far less find age catches up with them before their contract runs out, have the opportunity to develop during their time with us to the extent that we may be able to get a fee for some of them when they move on.

Who is to say that any of the following under 24s - Corcoran, Day, Anaclet. Foster, Ledgister, Yemi, Twigg - could not come on great guns over the next two years and get picked up by a bigger club for a fee, which in itself would help the bottom line??
If we can find room for a couple of our own youngsters each year (who will probably be on even lower wages) as well, then even better...

[neilw]

&quotI agree with others on here 5 x £30k players will serve us better than 3 x £50k players.&quot ......................

Personally, I'm not that knowledgeable about the market rate for professional footballers in the Oxford area and wouldn't be able to make a sweeping statement about what you get for what you pay.

However, in general employment terms, I can't imagine that many trained, specialist professionals would wish to relocate to an expensive area for £30k p.a, for a short term / 2 year contract.

[GodalmingYellow]

&quotI didn't say budgets weren't useful. Like most things, they are useful if done properly. They are completely pointless where an end result is pre-determined and the detail is set to fit the desired end result.&quot .................

Isn't a budget a financial plan of how to get to where you realistically want to be? Otherwise what purpose does it serve?

Yes they are, but its about how you identify the detail.

It is a statement of what you want to achieve. It is also a set of intended limits on expenditure, and a set of intended targets on income.

The way good budgets are formed is by reviewing each area of the business and determining how much income you want to (and can realistically) achieve, setting the acceptable limits on expenditure given known and predicted costs, allowing a level of margin for error, and the end result looks after itself.

If the end result does not match what you wish to achieve, then you have to re-consider whether your desired achievements are realistic.

If you do it the other way around and start with the bottom line and work backwards, then you end up with unrelastic budgets which aren't met and you get in a financial mess.

A simple example:

The good way:
I can make 1 football per week and the most I can sell it for is £10. Therefore the maximum income I can generate is £520.
It costs £3 to make each football, therefore my budgeted costs are £156.
10% contingency £16
Therefore my budgeted profit is £828.
If I want to achieve more profit, I need more labour, more materials, and more sales, or cheaper materials.

The bad way:
I want to achieve £1000 profit
I can make £7 profit per football, therefore I will budget to make and sell 143 footballs, irrelevant of whether that is achieveable or not.

[GodalmingYellow]

&quotI agree with others on here 5 x £30k players will serve us better than 3 x £50k players.&quot ......................

Personally, I'm not that knowledgeable about the market rate for professional footballers in the Oxford area and wouldn't be able to make a sweeping statement about what you get for what you pay.

However, in general employment terms, I can't imagine that many trained, specialist professionals would wish to relocate to an expensive area for £30k p.a, for a short term / 2 year contract.

Depends on what level of training they have had, and what standard they have achieved. For the Conference, I think £30k is a good average wage, and that amkes sense when you consider that our top earners are on £50k, and younger pros get say £15k.

[neilw]

Thanks for that lesson GY. I will circulate your guidance to all, here at work, right away, requesting your principles are adopted forthwith.

[GodalmingYellow]

Thanks for that lesson GY. I will circulate your guidance to all, here at work, right away, requesting your principles are adopted forthwith.

??????

Just trying to be helpful for what seemed like a genuine question. Some are obviously more genuine than others. Thanks for your civility. I'll forward your reply to the diplomatic corp, I'm sure they'll find a use for it.

[A-Ro]

Budgets!!

Rule No. 1

Never ask for less than you asked for last year.

Rule No. 2

Never ask for less than you asked for last year.

[Mally]

Budgets!!

Rule No. 1

Never ask for less than you asked for last year.

Rule No. 2

Never ask for less than you asked for last year.

Even when last year you had a pre-season game against Man Utd immediately after a World Cup? It was completely ridiculous to expect to increase pre-season revenues this year when there was no chance of getting a top 4 Premiership side due to their global pre-season commitments.

The bigger concern is that if this budgetted prediction was so wide of the mark what about all of the other ambitious plans for the season ahead?

[Baboo]

[The bigger concern is that if this budgetted prediction was so wide of the mark what about all of the other ambitious plans for the season ahead?

And a very big concern it is.
Which individual is responsible for these predictions?

[Mooro]

Budgets!!

Rule No. 1

Never ask for less than you asked for last year.

Rule No. 2

Never ask for less than you asked for last year.

Even when last year you had a pre-season game against Man Utd immediately after a World Cup? It was completely ridiculous to expect to increase pre-season revenues this year when there was no chance of getting a top 4 Premiership side due to their global pre-season commitments.

The bigger concern is that if this budgetted prediction was so wide of the mark what about all of the other ambitious plans for the season ahead?

Ridiculous possibly, unusual not so..

One company I've worked for had a very simple premise for budgeting - last year || 10% - even when that year included a one-off contract (similar in impact to the Man Utd friendly) which was never going to be repeated, therefore leaving us starting the year trying to squeeze something like an 18% uptake...funnily enough the panic started after three months...

[Mally]

&quotI didn't say budgets weren't useful. Like most things, they are useful if done properly. They are completely pointless where an end result is pre-determined and the detail is set to fit the desired end result.&quot .................

Isn't a budget a financial plan of how to get to where you realistically want to be? Otherwise what purpose does it serve?

Yes they are, but its about how you identify the detail.

It is a statement of what you want to achieve. It is also a set of intended limits on expenditure, and a set of intended targets on income.

The way good budgets are formed is by reviewing each area of the business and determining how much income you want to (and can realistically) achieve, setting the acceptable limits on expenditure given known and predicted costs, allowing a level of margin for error, and the end result looks after itself.

If the end result does not match what you wish to achieve, then you have to re-consider whether your desired achievements are realistic.

If you do it the other way around and start with the bottom line and work backwards, then you end up with unrelastic budgets which aren't met and you get in a financial mess.

A simple example:

The good way:
I can make 1 football per week and the most I can sell it for is £10. Therefore the maximum income I can generate is £520.
It costs £3 to make each football, therefore my budgeted costs are £156.
10% contingency £16
Therefore my budgeted profit is £828.
If I want to achieve more profit, I need more labour, more materials, and more sales, or cheaper materials.

The bad way:
I want to achieve £1000 profit
I can make £7 profit per football, therefore I will budget to make and sell 143 footballs, irrelevant of whether that is achieveable or not.

Can't take the credit for spotting this but it has been pointed out to me that making £828 profit from a turnover of just £520 is a pretty neat trick.

GY - Did Lenagan ask you to put the club's budget together for this year?

[GodalmingYellow]

&quotI didn't say budgets weren't useful. Like most things, they are useful if done properly. They are completely pointless where an end result is pre-determined and the detail is set to fit the desired end result.&quot .................

Isn't a budget a financial plan of how to get to where you realistically want to be? Otherwise what purpose does it serve?

Yes they are, but its about how you identify the detail.

It is a statement of what you want to achieve. It is also a set of intended limits on expenditure, and a set of intended targets on income.

The way good budgets are formed is by reviewing each area of the business and determining how much income you want to (and can realistically) achieve, setting the acceptable limits on expenditure given known and predicted costs, allowing a level of margin for error, and the end result looks after itself.

If the end result does not match what you wish to achieve, then you have to re-consider whether your desired achievements are realistic.

If you do it the other way around and start with the bottom line and work backwards, then you end up with unrelastic budgets which aren't met and you get in a financial mess.

A simple example:

The good way:
I can make 1 football per week and the most I can sell it for is £10. Therefore the maximum income I can generate is £520.
It costs £3 to make each football, therefore my budgeted costs are £156.
10% contingency £16
Therefore my budgeted profit is £828.
If I want to achieve more profit, I need more labour, more materials, and more sales, or cheaper materials.

The bad way:
I want to achieve £1000 profit
I can make £7 profit per football, therefore I will budget to make and sell 143 footballs, irrelevant of whether that is achieveable or not.

Can't take the credit for spotting this but it has been pointed out to me that making £828 profit from a turnover of just £520 is a pretty neat trick.

GY - Did Lenagan ask you to put the club's budget together for this year?

I wondered who would spot the deliberate mistake.
Obviously the profit in example 1 should be £348.00

I'm going to hide in a very dark corner where no-one can see my embarassment...