A-League must learn how to run a successful business

By q / Roar Rookie

In light of the recent news surrounding the Newcastle Jets’ demise, the football community is calling for the heads of both Clive Palmer and Nathan Tinkler.

But are this pair really at fault, or is the A-League to blame?

To paraphrase some of the comments I’ve read about Palmer and Tinkler, their reputations have been tarnished within the Australian football community.

But let’s calm down for a moment and consider their positions.

Who wants to give a pile of their own hard-earned money for the sole purpose of pouring petrol over it and tossing a lit match on?

This is exactly why Palmer and Tinkler don’t want their money invested in A-League clubs; they’re losing money. Lots of money.

You hear people talk about these guys having a lack of love for the game and that they have no loyalty to the institution that is football.

So does that mean that it’s OK for our clubs’ investors to lose masses of money for the sake of the game?

Maybe for a short while, yes. But if we think about the long-term state of the game, we need the A-League to keep making money for its franchise owners.

This is not taking the football for granted; this is being realistic about the viability of a world-class football league.

So how does the FFA solve this?

Perhaps they could start by giving the owners a better picture of where their money is going?

It seems that one of the consistent complaints that the clubs have is that the money that they are pumping in is being siphoned off by the FFA.

They spend it as they see fit, possibly without proper consultation with the clubs. This is not an ownership model that is common in sports (or business in general for that matter).

Most professional sports leagues are managed through a setup (commonly called a commission) which consults the owners of clubs on all issues.

Whether it be expansion, scheduling or sponsorship, the owners have a say on how to better the league that they have invested so much in.

Their money is at stake, and they want to have a say in how it is spent.

Perhaps the Joint A-League Strategic Committee (JALSC) is a move in the right direction, but perhaps it could go even further?

Remember, these owners are businessmen who know how to be successful.

Let them control their own destiny and ply their trade in promoting their own clubs as well as the league, negotiating with sponsors and broadcasters and seeing how profitable football in Australia can really be.

If they can get to this point, the Palmers and the Tinklers will return. They would love to invest in a sustainable, profitable business.

The Crowd Says:

2012-04-16T04:15:18+00:00

PeterK

Guest


jbinnie, my own belief is that the common thread is one of feeling "strung along". The Canberra consortium I believe have recently used the very same words. Whether that be true or false, it seems it is the perception. It might also explain why those who have not suffered it don't seem to be able to understand what the problems are. I passionately want the A-League (and the FFA) to succeed, but as I've suggested elsewhere, those who claim all is well have their heads in the sand just as much as those who claim the sky is falling in. There are some problems, and they must be fixed.

2012-04-15T03:04:35+00:00

jbinnie

Guest


Dave - The concerning factor about the HAL shenanigans is that all are entirely different in the content of the objections made by the FFA. In GCU's case the problems facing FFA have been entirely different from the problems they have faced at the other "failed" franchises.GCU were a club that were reportedly paying all it's bills,owed the FFA nothing,had a team that was performing reasonably well on the field, but had a HUGE problem attracting people to a stadium that they were instructed to use by the FFA,under the excuse that they ,the FFA,wanted to portray an image to the TV audience Australia wide.Using a business yardstick the club had to be costing the proverbial "bomb" The Fury problem has been widely documented. Despite the due diligence done by the FFA into the possible future "health" of the identity,and despite drawing bigger crowds than GCU, the Fury got the chop with the FFA excuse being that one partner had got into financial trouble and the other could not sustain the costs on his own,resulting in the FFA having to put money in as they had to do at many other clubs Then we come to Newcastle and again we find a disparity in excuses for removing their licence.The Jets have increased their average watching audience by over 4000 this year,and are reported as having increased their memberships to over 10,000, so I think it can safely be said that the HSG must have been doing something right, and yet the owner saw fit to walk away from his promise,potentially a hugely costly course of action. Now if these 3 occurrences have anything in common it is that on every occasion there has been innuendo stated by the owners that they were not satisfied with the managing capability of the FFA. Has anybody cared to find out why.? Surely in these days of mass ,almost instant, communication it would not be hard to isolate 3 individuals and ask just what their dissatisfaction consisted of,for there is an old adage that should never be ignored,"Where there is smoke there is usually fire" jb

2012-04-14T04:00:13+00:00

super G

Guest


Ja das stimmt, Herr Fussball!

2012-04-13T03:52:32+00:00

dangerousdave

Guest


A lot of clubs that make losses do so because of the massive salaries that they have to pay players, not because they are poor investments. This is one reason for the salary cap, as the biggest expenditure a team makes (the salaries of the players) is controlled and predictable. I'd suggest a better model for the A-League would be some the US major sports leagues (NFL, NBA, NHL, MLS,not MLB though as it has not salary cap). In these situations the TV contract (negotiated by the league) basically covers the salary cap for all teams, leaving plenty of other revenue to be made through sponsorship, tickets, merch etc. This can leave the club with a healthy profit, which would usually be reinvested back into the league.

2012-04-13T03:43:49+00:00

dangerousdave

Guest


Private ownership can, and does work in a number of other leagues. A problem arises however when those owners are viewed as league management as simply people to fund the league rather than have a say in it's management. I'm not trying to defend the actions of Palmer and Tinkler, but rather suggest ways to avoid similar situations in the future.

2012-04-13T03:35:13+00:00

dangerousdave

Guest


All that you say is true. My point is more that if you give more control to those who invested the money, they will be less likely to become disgruntled when they are powerless to prevent others from (real or perceived) mismanagement of the cash.

2012-04-13T03:32:35+00:00

dangerousdave

Guest


I agree that their attitudes and way of doing things wasn't very good. However, if you handed over quite a large sum of money, wouldn't you like to have a say in how it was spent? Keep in mind that I'm not talking about these guys in particular, rather about how the FFA should approach this in the future.

2012-04-13T01:10:46+00:00

Raghu

Guest


Frank Lowy is the largest shareholder in Westfiled is still the Non Executive chairman. His son are the Executive Chairmans now. He many not me involved in day to day afairs but big decisions still has to go through the board which he chairs.

2012-04-13T00:48:00+00:00

Qantas supports Australian Football

Guest


Frank Lowy is not attached to Westfield corporation anymore...The Gold Coast Premier league (Park and grass roots football) is still being funded by Clive Palmer. I'm not saying Frank Lowy doesn't love football but for a man of his wealth he has let others carry the can more than he is personally prepared to do himself.. 1970? I presume you are referring to Sydney City (Hakoah) but that was funded by the Hakoah social club not by him.

2012-04-13T00:31:02+00:00

raghu

Guest


The W-league is sponsored by west field. Without it our girls wouldn't have a professional league to play in.

2012-04-13T00:06:24+00:00

Chris

Guest


I think the fundamental point of the article is correct - much more attention needs to be paid towards running professional sporting competitions and the clubs within the comps. In some ways the A-League had probably loosened the reins a little too much in letting the clubs spend beyond their means. And in my opinion this is the basic problem the world over - most clubs can't be trusted to run themselves in a financially responsible way - the desire to win a comp trumps fiscal responsibility sooner or later. But I still hold that Tinkler should be help accountable for the contract he signed. That's a separate issue.

2012-04-13T00:02:24+00:00

Dillan

Guest


Yep, I wouldn't think any sports team in Australia make a healthy profit. Ideally any profits would go back into the club...

2012-04-12T23:58:36+00:00

Dillan

Guest


Don't forget all the Westfields signage at A-League games and isn't it the Wesfields womens national team...

2012-04-12T23:56:49+00:00

Mr Celery

Guest


The first questions FFA should ask any perspective new Club owner is: "Are you looking to make a profit from football, and are you getting involved for the love of the game?" If the answer is anything other than "No." to the first, and "Yes." to the second, there should be serious doubts about the ownership model proposed and the sanity of the prospective owner. Unless you are Manchester United, and maybe a few others, I understand that all premier Clubs worldwide are loss-making ventures. To think you can make big bucks from owning a football club is naive in the extreme. Don't blame Lowy or FFA if there are naive 'business people' willing to contribute funds to football in the hope of a financial reward. The two recent high profile failures Palmer and Tinkler are Rugby League lovers foremost. So biff and barge and lack of common sense would be in their genes. (Anyone with a love for Rugby League, the simpletons game, has to have a faulty gene!) You would expect them to miss the bleeding obvious - that sports are a loss making enterprise, just like gambling. Tinkler, with his penchant for a day at the races, should understand that very well.

2012-04-12T23:37:24+00:00

Titus

Guest


He has also been putting in money since the 1970's. I doubt he made any money on it. Frank is in it for the long haul, Clive isn't. Don't get me wrong, I think the time is soon coming that Frank should pass on the reigns to some new blood, but to criticise Franks commitment to the game, both financial and "blood, sweat and tears" is wrong. To compare Franks commitment to Clives is laughable.

2012-04-12T23:33:30+00:00

Fussball ist unser leben

Roar Guru


1. I have no connection to the FFA - apart from paying registration fees when I was playing football in my youth. 2. I do not consider myself a fan of Schalke but I enjoy watching them play since Raul has joined the team. To be honest, I enjoy watching Bundesliga more than any other o/s pro-football league. I think it's got the best technical & tactical teams across the whole league. Currently, BVB is the team that grabs my attention since former MVFC player, Mitch Langerak is reserve GK and, next season, CCM youngster Mustafa Amini will join the club. And, with Matthew Leckie at Gladbach & Rukavytsya at Berlin, I find myself checking Bundesliga results before I check EPL results. 3. My only experience in Western Sydney was a trip to the Blue Mountains circa 1996. PS: I'm not German and, since this is an English-language website, I find it odd for you to post in German. My nom de plume is drawn from the name of a football song made famous by the World Cup Winning, 1974 German National Team

2012-04-12T23:25:46+00:00

Pete #205

Guest


Yes, that's right... Because nobody here speaks German... or has access to Google translate. Quick! Pull out the Enigma machine! He's speaking in code!

2012-04-12T23:23:43+00:00

Qantas supports Australian Football

Guest


Well put a figure on it.. I read that SFC's first year debt was $7m and that was shared with other board members. Also I read somewhere he was not willing to contribute to the HAL out of his own personal wealth.

2012-04-12T23:17:10+00:00

Michael Wilson

Guest


Durch Ihre Nachforschungen über meine Vergangenheit auf der Webseite bin ich auf Sie aufmerksam geworden. Nachdem ich Ihre Fragen beantwortet habe, und nachdem ich sehe, dass Sie an zahlreichen Gesprächen teilnehmen, aber Ihren richtigen Namen nicht verraten, würde ich nun etwas Info in der anderen Richtung schätzen. Können Sie mir sagen: 1) Stehen Sie mit der FFA in Verbindung? Wenn ja, wäre das für uns möglicherweise sehr von Nutzen.2) ) Sind Sie ein FC Schalke 04 Fan? 3) Haben Sie irgendwelche Geschäftserfahrungen, die fürs Geschäft mit Western Sydney relevant wären, und die meine Kollegen nutzen könnten?

2012-04-12T23:14:15+00:00

Titus

Guest


I'm willing to bet that Frank Lowy has put more money into Football than Clive Palmer, and he did so because he loves the game.

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