Q&A with Mark Palios

[Rockford's Love Child]

I went to the TROSC AGM tonight which featured a Q&A with the Chairman.

A number of topics were discussed, but the most interesting was the prospect of a new stadium. There are no solid plans as yet, but Palios essentially said that if the club wants to be sustainable in the Championship in future, we would have to move to a new ground to maximise our off the field income.

For the current season we have a playing budget of £2.56 million which the owners hope to increase to £4 million by 2022 by maximising and expanding existing revenue streams, which they believe will make us a stable, competitive League One club in the medium term. However, they do not believe it is possible to make the step to the next level without the ability to raise far greater income form the stadium on non-matchdays.

MP showed a graph of Championship playing budgets from the 2017-18 season: the lowest spenders were Burton on £10 million, the highest Aston Villa with a budget of £73 million per year. MP estimates that, at Prenton Park and with no major expansion of off the field activities, we would have a wage budget of £9 million at that level. If we managed to fill Prenton Park to its 14,000 capacity every game, we would have a budget of £12 million, still at the very low end of Championship wage budgets. If we filled PP every match and expanded our off the field activities to their absolute maximum, we would achieve a budget of £15 million, still in the bottom third in that division and likely to end in relegation after a couple of seasons.

To be sustainable in the Championship MP believes we would need a higher budget than those quoted above, which would not be achievable at the current site, without the backing of an Arab sheik or a US hedge fund (God forbid).

The potential site that has been earmaked for the stadium is Bidston Moss. The development would go hand-in-hand with the wider regeneration of the dock area, and any new stadium would incorporate other facilities such as conferencing suites, leisure facilities and potentially a hotel. The site is considered attractive because of its good transport links, close to rail stations and the M53, and its easy access to Liverpool city centre. The stadium would theoretically have an initial capacity of 15,000 with the potential to expand further, and would be modelled loosely on Rotherham's new ground.

MP emphasised that substantial additional investment would be required for the development, but that further investment is likely to arrive in the next few years. The club are talking to other potential investors, in addition to the Indonesians, while the Indonesian party have the option of purchasing another 15% stake in the club in the months ahead if both sides are happy to proceed.

In short, it is likely that we will receive additional foreign investment in the years to come and the supporters (who would be consulted ahead of any stadium move) will probably have to decide whether they are happy to stay at PP as a sustainable League One club, or be willing to move to a new gorund to set their sights a little higher.

 

[aldoes mustache]

thanks RLC . its interesting to hear this . sorta guessed . that the investments would be needed to move rovers forward . we the fans need to get the park filled they are getting there . its scary thinking that Burton had a 10m budget on 5k crowds

 

[ONIGP]

thanks RLC . its interesting to hear this . sorta guessed . that the investments would be needed to move rovers forward . we the fans need to get the park filled they are getting there . its scary thinking that Burton had a 10m budget on 5k crowds

It sounds like a very focused and well thought out plan. That level of planning against a backdrop of a game played 11 v 11 with a ridiculous amount of variables every match, every week, every season is bloody scary, though. With 3/4 promoted and 3/4 relegated every season which are increasingly revenue affecting due to TV money there always needs to be a Plan B … and C. You're right AM it is pretty mind-blowing to think Burton had that playing budget. Mind you, I wonder what Bournemouth's budget is on 10k crowds!

 

[Rockford's Love Child]

Bournemouth's average player salary last season was £38,000 per week.....

 

[drwhoman]

TV money keeps the likes of Bournemouth alive plus a very good Manager. An excellent report in the finances RLC. Thanks!

 

[bring back the cowshed!]

Thanks for a great report, RLC. I had not realised what a glass ceiling there was between League One and the Championship. It explains why so few "small" clubs survive up there very long.
Moving to a new stadium would be a big financial risk as well as a huge emotional upheaval for the fans. I'm glad Mark is taking us on board as he deliberates.
Meanwhile, League One survival is our aim and presumably we actually cannot afford another promotion yet!

 

[ADD]

Very interesting RLC - thanks for the report!!

Interesting to hear the Indonesian investment could go to 30% and yet the Palioses are wanting more investment - would that make them minority shareholders???

My take on this is I don't see that we can justify Championship spending as our crowds just do not warrant it. All the rest sounds interesting but to what point?? Why sacrifice our soul to try and get Championship football? We would then be dwarfed by the parachute clubs and struggle to stay up no matter what we do.

Another factor if we moved to Bidston Moss would we get the same or more/ less fans? I struggle to believe when we are in a soulless stadium which people have to drive to/ use public transport that we would get many more and we may get less?

For me a budget of £15m (way more than now) if we maximise PP is great - gives us yes a chance of promotion to Championship but even if we go up and then down again we should be very much top half L1 every season with the prospect of being strong enough for some FA Cup runs and so games against Premiership sides to top up the finances further.

I hope that does not seem like lacking in ambition but is Championship a realistic objective when against Burton we had only 6,500? I am doubtful and would prefer my club to be solid and safe without risking financial meltdown if we push for the unattainable or if the overseas investors bail out in the future? Thoughts?

 

[Ian]

Thanks RLC, very interesting.
I'd be up for a move away if it meant we could compete with championship clubs.

Rotherham's stadium was excellent with room for expansion. If you don't move with the times you get left behind. We need a budget that can compete in whatever division we are in. Already you can see the struggle we are going to have this season as we haven't had the budget to bring better quality in.

 

[Ian]

I hope that does not seem like lacking in ambition but is Championship a realistic objective when against Burton we had only 6,500?

Interesting point but I think we'd be able to pull in 12k+ a game if we were in the Championship.

 

[MancunianWhite]

Thanks for the update RLC interesting reading ..

For me i would focus on trying to fill PP every week and what will be will be, it wasn`t that long ago (a decade) we were struggling to get attendances of over 4k!

I look at Brentford, Wigan, Luton who are either surviving or survived for a period in the Championship with average attendances of 11k

 

[Ian]

You have to remember some of these are long term plans. I'd imagine a ground move to be some way in the distance and that's well after establishing ourselves as a div one club never mind a championship one.

 

[Rockford's Love Child]

You have to remember some of these are long term plans. I'd imagine a ground move to be some way in the distance and that's well after establishing ourselves as a div one club never mind a championship one.

Indeed. I think Palios is just testing the water at the moment and it is very much a long term project.

 

[Rockford's Love Child]

My take on this is I don't see that we can justify Championship spending as our crowds just do not warrant it. All the rest sounds interesting but to what point?? Why sacrifice our soul to try and get Championship football? We would then be dwarfed by the parachute clubs and struggle to stay up no matter what we do.

I think that is why Palios is putting these ideas out there. He wants to gauge supporter opinion before we firmly commit to anything, as a stadium move certainly would not be universally popular.

I think we would only ever achieve income of £15 million at Prenton Park if we were in the Championship, not League One. Even then, it would be highly unlikely as in reality we would not fill the ground every week.

In the event that we don't move it seems we would be a 'yo-yo' club at best, bouncing between League One and the Championship. To be honest, I would be quite happy with that situation, provided we were financially stable.

 

[bigmart]

The playing budget is a little higher than I thought this season, I wonder if it is a bit higher now because of the recent additional investment as I would think there is still money to add to the squad when the January window opens.

Some interesting points raised, first thing first we need to establish ourselves in league 1 and then look to kick on from there

 

[Boz]

Thanks for the informative report, RLC.

I'm not entirely convinced of the need for a move, based mainly on the need to generate more non-footballing income to support the football side. There is an emotional attachment to Prenton Park, it's also fairly easy to get to by public transport. At one point, there was talk of re-developing Prenton Park, presumably that has been rejected by the Palioi now? I also recall in the early days of their takeover, that either Mark or Nicola indicated that financially the sale of PP for housing wouldn't generate the funds for a new stadium, wonder if it's value has increased or the new funding coming into the club is a factor. Personally, I would be more sympathetic to the idea of a move, if it was to central Birkenhead or the waterfront area as was mooted a few years ago. Bidston Moss has the feel of an out of town, rather souless location, with poor public transport links and a stadium there would be akin to the Shrewsbury new ground or the Deva.

Like bigmart, I'm a little surprised that our playing budget is at that level. It makes you wonder about other team's budget's, given reports of our inability to recruit players who've ended up at other L1 or L2 clubs.

 

[Rockford's Love Child]

Like bigmart, I'm a little surprised that our playing budget is at that level. It makes you wonder about other team's budget's, given reports of our inability to recruit players who've ended up at other L1 or L2 clubs.

I think the average in League One is about £4 million so ours still is not great, certainly towards the bottom end. As stated above, we don't expect to reach that level for another three or four years, which demonstrates that we are up against it a bit financially.

 

[Rockford's Love Child]

Personally, I would be more sympathetic to the idea of a move, if it was to central Birkenhead or the waterfront area as was mooted a few years ago. Bidston Moss has the feel of an out of town, rather souless location, with poor public transport links and a stadium there would be akin to the Shrewsbury new ground or the Deva.

Yes, I agree. I don't know how feasible a town centre site would be, but I would love it. A ground in central Birkenhead would also do far more to revive the local community than a stadium stuck out on a limb.

Bidston Moss has good motorway links but is pretty characterless and is not strictly in Birkenhead either. I think there would be a danger of losing touch with the core of our support at that site. That is what happened to Colchester when they moved out of town to a stadium next to a motorway; their attendances actually fell and the ground is generally unpopular with the locals.