Is there an ideal business model for NRL clubs?

I couldn't think of anything less speculative than property. Surely if investing in property is speculative then relying on memberships is just as speculative.

I am obviously biased on the matter,but to have a membership based club,with a flourishing leagues club and ongoing rental income from attached retail developments,not only retains the independent "my club" ownership status but at the same time,ensures long term financial stability and ability.Throw in owning one's own ground is an added bonus. Despite all the dramas through past management incompetence,swirling around the Sharks ATM,that is the plan,and that plan will have its genesis in July this year. Private ownership can be at the whims of the owners,as they can come and go.The Broncos with the benefit of a one team rugby league town, do however reap the benefits. Manly's situation,with ownership issues shows the part private ownership model,has some inbuilt problems.It gnaws at their fans and sponsors,and creates instability. As long as owners and members are pulling in the same direction,and they keep costs under control.maximise memberships and sponsors,underpin the local grassroots,make the fans part of the club, all models have a strong chance of a long life.The days of depending solely on poker machine revenue as the backbone, are fast drawing to a close.Society in the main has dictated thus.

One key issue for both the major football codes in Australia is they are operating on a model that more or less assumes that the hyperinflation we have seen in media rights over the last twenty years will contimue and every new media deal will come in well over the CPI for the interim period. I am no expert in this area I don't have either the skills or the resources to value what the NRL is really worth but there is little doubt for decades it was selling itself well below it's value... but chances are it is getting closer to "what the market will bare" and the rapid media rights inflation of the last twenty years may be coming to an end. So it will have to start looking at controlling costs just in case future media deals don't replicate the hyperinflation of the past twenty years (and my gut feeling is they maybe have one big jump left and then will dribble along in line with the CPI) Most clubs most years lose money on their football operations and the aim of the NRL should be to reverse that and have most clubs most years make money from football alone.Relying on something as speculative as property development is not a sound business model . One area the NRL need to be very careful with is calls to pump huge money into the so called grass roots... there is a big potential for these minor Rugby League bureaucracies to burn loads of money for little return. They will also have to look long and hard before they leap into introducing new teams and player salary inflation needs to be controlled - if that means losing the odd player to Rugby so be it.Also with the ARU in financial trouble I suspect high profile Rugby conversions will be pretty rare.

So you think property is more likely to be sensitive to population growth than say a mass media ratings driven income stream?

There is probably a reason the model is now pretty much banned by the NFL.

to which I give you three words model-now-banned

Interesting read Greg. Do the Clubs that are privately owned have an expiry date on their licence? I find it interesting how both the Tigers and Dragons are merged clubs and have both been recently bailed out by the NRL.Tigers $4 Mill Dragons $2 Mill and both clubs have been mentioned as wooden spoon contenders.Something or everything must be amiss.Does success,both commercial and on the paddock start and finish with a capable board?

Interesting, a 25% share will no doubt provide some influence and may block some decisions without the approval of the 25%, there may be some pre-emptive provisions which could entitle them to increase their interest.

Property is only any good while the population increases & unemployment remains low. It remains to be seen if property will be a good investment in future. Especially in Victoria, with manufacturing job losses. The ecconomy is changing, and high exposure to property isn't a sure thing. Especially when everyone is trying to ride that wave

St George Illawarra are 1/4 private owned. Illawarra flogged off some assets (mostly plant items) and half their share of the Dragons to the billionare owner of WIN tv station to pay off a multi-million dollar debt to St George Dragons. He can only sell his 1/4 share back to Illawarra though.

How so?

As Queensland's Joh Bjelke-Petersen the then Premier of Queensland would say news conferences are essential because you have to take time to "feed the chooks".

I don't think we have any true member owned clubs in the NRL. People sometimes equate Leagues club with Football club memberships, but they are different entities. From memory the Bulldogs have approx 900 voting members of the football club, and something like 30K + Leagues club members. Only the football club members can vote for the football club board. I think most NRL clubs operate in a similar fashion to the Bulldogs who use this model. For me this is one of those things that need to change.

You are right, Walter. There is plenty of propaganda and all the clubs have their stooges in the media who limply write whatever BS they're told. Regards the Raiders. I wonder whether Eels fans realise than when they shop at Bunnings Seven Hills, they are actually giving money to Canberra Raiders whose parent company own it.

Some interesting thoughts, but I wonder how really representative the Club owned teams are, or are they in fact controlled by well entrenched committees with limited ability for the average members to influence the Club. Also information is king and the Clubs are rather tight on what information is available to members to make their own assessment and the Club websites are little more than propaganda sites encouraging no real debate among members and fans.

The best model is what the Raiders are doing. They have a number of registered clubs which have formed the Raiders Group. The Group is accruing commercial real estate, the rentals from which are used to fund the football club. By last year the Group had acquired $33 million in real estate, reaping over $3 million for the football side of things. Eventually it will be self-sufficient. The Raiders are sleeping giants, as is the Panthers Group which is on the same path with its real estate. Compare this to, say, Parramatta and Souths. They have sold real estate to fund annual losses. So much so at Souths that the leagues club building was sold as were 11 home units. This was the same building and units that Souths promised in 2006 would sustain them into the future from rentals. Yet by 2012, all of that property was sold, not to retire debt, but to fund its annual losses, which they then pretended were actual profits. The Eels did similar with the leagues club selling $9 million in residential units. Raiders and Panthers built on bricks and mortar.

Which is nice, but I guarantee the 31 other owners have done more to make the money that the NFL gets that make a team like the Packers able to exist.

I know the Bulldogs have been looking to become self sufficient on the football club side of things, still a ways off to ensure you have the money to do that and remain competitive at the same time, but it's also nice to have an awesome Leagues club to fall back on which has ensure it diversified it's income streams enough. Only thing I would like is that people who sign up for club membership also after a few years are able to join the football club voting side of things. Currently you need another football club memeber to vouch for you, and then wait few years for voting rights.

3 words -Green Bay Packers

Good summation Greg.