In the aftermath of the defeat at Hampden, there has been a highly entertaining outpouring of quintessentially British anger from the Ibrox klanbase.
Although they have grasped that they are currently simply the second best in Glasgow, they’ve not yet worked out why that is the case.
The poor dears.
Their kulturally driven default setting is to lash out blindly.
So far, the dignified analysis is that if only Messrs Bisgrove, Robertson and Wilson would do their respective jobs better, then all would be well.
It goes something like this:
- Wilson should buy better players and sell for higher.
- Robertson and Bisgrove should be bringing in more money.
- The brethren in the Blue Room should, somehow, be financing their dreams.
Dear reader, that isn’t even close to the facts on the ground.
Consider this:
Three critical fundamentals will be challenging to change and not in the short term.
- Celtic’s near 10k capacity advantage (9594) translates into around £5m revenue advantage on season books alone.
- Assuming each club plays the same number of home fixtures and has the same proportion of fans attending relative to capacity, this translates to an additional £5m in match day income based on 25 home games each.
- Celtic has contracts in place that in 21/22 generated £31.9m compared to £20.4m at Sevco.
Some might say the outlook for Commercial revenue improvements at Ibrox could be tricky. They often end up in court with just about every company they are in partnership with. Reputation counts a lot in the football commercial village.
As it stands, at the start of every season, Celtic have a £20m revenue advantage over their neighbours—each and every season.
To counteract that, Sevco could:
- Perform wonderfully in Europe every campaign.
- Sell players for vast sums every year.
- Negotiate better commercial deals continually.
- Indulge in dodgy tax scams with imperfectly registered players to give them a concealed financial advantage over their rivals.
Ok, probably not the last one on that list…
The problem for the Ibrox klanbase is that they follow follow a financially smaller football club than the other mob.
Don’t believe me?
Well, compare and contrast these figures from the excellent Swiss Ramble.
Unless the Sevco High Command accepts that they currently run a significantly smaller business than Celtic, any move they make will make their situation worse.
In chess, they have a word for it:
Zugzwang.
Several commentators here have raised the issue of expanding and upgrading the crumbledome as a way of playing financial catch-up. I really do not see that this will be remotely possible unless they’re taken over by some oil-rich sheikh or oligarch.
The cost of such an undertaking would likely run to £100m minimum. They simply couldn’t, as things stand, come close to funding that kind of expenditure.
They are a perennial loss-making business. They couldn’t even begin to pay the interest on the money that they would undoubtedly have to borrow, IF they could find a lender, to make such a project a reality.
They would have to close massive parts of the ground while work was in progress, further reducing income, or do what Celtic did and decant to Hampden, with the associated costs involved in that.
I just don’t see how they could possibly do it.
Hi there. Yes, I mentioned this. I think the way I put it is that this WAS an option open to them. Had they committed towards doing this from the establishment of the company in 2012, they could have done it. I agree that it is not an option for them NOW, without the kind of Angel Investors you suggest.
They decided to spend the money they had (and more) on the playing squad. They bought into the ten in a row hype (as we did, stupidly, in my view – and we must not do so again; make good operational football decisions and don’t be swayed by petty short term goals) and did what they needed to to stop it. They did. But that wasn’t a terribly sustainable investment. It was only underwritten by King’s ‘pack/house of cards’ theory. That’s a poor theory either way (for either club: I don’t think reckoning that Celtic or Rangers fans will permanently desert their respective clubs is a sound assumption).
If they get CL group stage football for a second year running, that could change the outlook a little. But, they did incredibly well to pull that off this season (credit where it’s due; that wasn’t easy). Their playing squad does not look better than (or as good as) it did then, and no longer has the muscle memory of the impressive European run from last season.
The selling high might not be as easy as they think. Clubs might be reluctant to pay them big money for players that flatter to deceive in the Scottish game, but are hardly setting the English (Paterson, Aribo) or the Dutch (Bassey) leagues on fire with their play or lack thereof.
Seems to be bourne out by https://www.dailyrecord.co.uk/sport/football/football-news/wesley-sneijder-veiled-rangers-jibe-29415153
A relatively small time question, since I often use this argument myself: does the difference in season ticket revenue account for the fact that Rangers tend to charge more for a season ticket than Celtic do? Is the difference based on an average season ticket cost (i.e. averaging out full price, concessions, hospitality etc.) or is it based on full price adult fees? Are there published records of average matchday income atbthe two grounds? Do they overlap with the season ticket revenue?
Small beer relatively speaking. The overall thesis is obviously spot on, regardless of the answers to the above.
Another option that WAS open to them over the last decade was to spend the good money they had on upgrading and expanding the stadium, rather than on dead end player acquisitions. That would have given them some hope of reversing this trend in a meaningful way within a decade or so.
Rangers fans do not appreciate the fact that we are currently about 20% better than them and this % is growing annually. What will happen when we trounce them again at Celtic park? Will they finally realise they are only second best due to shonky penalties and the MIB. There is not a single Rangers player who would be good enough for Celtic. We are past a tipping point.
I have enjoyed re-using the tag “best of the rest” to my friends of the blue persuasion lately. They visible shrink, as those with common sense understand my point and open up to thos reality.
Looking at those figures, the gate money seems to be little different for Sevco and Celtic. I’m not sure the bigger stadium is making that much difference. The difference in spending looks to be only 5-6m a year, so maybe 7% of the operating costs. It’s not huge. The big differences look to be the commercial contracts and the player sales. But for all that, Sevco’s debt is small and Celtic’s cash balances are not much use unless they are used to increase performance.
Did the two teams play the same number of games? Rangers’ European run gave them an unexpected financial boost which may not be repeated. You are therefore comparing a good Rangers season (financially) with an average Celtic one.
That’s what I was thinking with my earlier question. Rangers charge more for a season ticket than Celtic, year on year. I’m unsure what difference that makes.
Celtic are in better shape granted. The complicating factor in all of this is the fact that Beales Sevco can easily beat the third best team in the SPL and below (though they had some good fortune at Pittodrie). They only need to win. We might win 4 or 5-0 giving us superior goal difference (+1 point). Then it comes down to the 4 head to head games. The fact that the rest of the SPL is absolutely dire will make things closer than they should be.
I don’t think the argument is that Rangers will never win the league. As you say, in a league where second is miles ahead of third, in a season where second is in relatively good shape and first is off it / in transition / whatever, there will be seasons where the second richest team comes through.
A lot of (perhaps most) domestic leagues in Europe are like this. Holland has a big three (in the sense that all three are far wealthier than the rest). But one is much bigger than two or three. Ajax is by far the single dominant club. But every few seasons, the squad will rotate and there will be a rebuild, during which time PSV or Feyenoord will often take the title.
Indeed, this is a pretty good model for Celtic. Arguably, proper long term planning will factor in the possibility of Rangers winning the league every few seasons (chasing the ten for the sake of it would be a ridiculous thing to do; who cares?).
But, I think the overall argument is about dominance. Zagreb dominates Croatian football. That Rijeka (often second) took a title a few years back doesn’t change that.
Rangers should make expanding their stadium their absolute priority if they want to change the overall pattern. But by committing money to that, they would be accepting that the financial deficit between them and Celtic would inevitably be still larger in the short to medium term.
I partly agree with this, with them a horrific 25 points ahead of Hearts, which is likely to grow to 30+ by season end.
The caveat for this, is that at some stage, our relentlessness is likely to demoralise them and see them dropping points against others, not many but enough to grow the gap but not enough for a 20+ margin.
This is what happened with our man Gio, who despite a Euro Final and CL qualification, started to feel the effects domestically to our domination, after less than a year.
If we were to beat them in our upcoming game, this would stretch the lead to 12 points, assuming both win other games, then this is likely to kick in, with every subsequent game being a pressurised one to delay our title win.
Spot on. And when dodgy officiating is taken into account, ie decisions going for them or against us, things could be closer still. There will also be rebuild seasons. They will win titles, but going forward, we will win more. As long as our financial is properly and wisely used.
We’ve got them down. We need to keep our foot on their neck. They would do it if things were reversed.
I think the word to use here is fucked, not zugzwang. After all, Sevco supporters are too thick to understand German or chess.
The important thing to note from the two spreadsheets is Sevco made an operating loss of £11.4m last year despite raking in ~£25m from the Champions League. Player sales helped Tribute Act Rangers get close to break even. That isn’t sustainable.
Sevco won’t get CL money this year. Which means they’re facing a projected loss of over £30m for the current financial year.
You are forgetting to factor in the money for Calvin Bassey which is in the current accounting year.
Fair enough. I’d overlooked that. So I suppose the dosh for Bassey means Sevco are only looking at a loss for this year of £29,999,999.99 instead of £30m. 🙂 FWIW I am aware how much he was reportedly sold for.
My point remains. And it’s one you’ve made a few times. Sevco relies on CL money and/or player sales to plug the black hole in their finances. That’s not sustainable or a viable business model. It’s not going to end well.
I am positive that a good few years ago…their man Robertson said that they would be relying on European income for their survival…I remember thinking…WTF…!!
Gary Kasparov: your chess opinion cannot be questioned.
But, I did hear that Ange likened the Ibrox position to an “Arabian Mate”.
The bonus being that having dropped Club1690, King was now ‘trapped in a corner’. 🙂
In these accounts, they earned from their Europa League run not through the Champions League.
This year’s account will include Champions League and although no knock-out ties, this is likely to be similar and perhaps more than last year’s Euro millions.
This year’s will also include, I think, Aribo & Bassey transfer money (last year’s included Patterson).
Overall, the accounts should be similar, showing a small loss or perhaps even a profit.
Next year, they need similar Euro and transfer turnover or severe austerity, otherwise they’ll be back to big losses.
Initially confusing to see positive figure (Net Funds) in brackets and in red on Celtic data. Usually brackets and/or red mean bad news on accounts.
Thankfully a closer look confirms we are in a good place, as expected.
What about rooked?! 🙂
No money, huge losses, UEFA on their case…
Seems like sevco just has to copy the Benfica model to develop young players and sell for big money/
The bears might not wait 10 years though.
Interesting that Celtic’s Wage to turn over percentage in 2022 was 67% compared to Sevco’s 63%… Why are Sevco being chased under the FFP rules and not us? I know that the wage to turn over ratio is not the only criteria but it is interesting nonetheless….
The figures are averaged over a number of years rather than a single year.
You’ve also got to factor in that 2022 was an exceptionally good financial year for them albeit probably to be repeated this one too. They still made a loss (albeit small) and the underlying picture is poor (frequent share issues/directors loans, numerous litigations etc), all classic examples of a distressed company.
Whereas in our Covid annus horribilis we only made a modest loss comparable to their “brilliant” year last year, then its easy to see why the fundamentals are strikingly different.