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Football Finance & the Inevitable Championship Graveyard

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The Championship isn't sustainable, here's why.

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As I write this, Sports Shield are in the midst of a dramatic take over of our beloved club; just another chapter in a story that wouldn't look out of place in a Hollywood script.

The takeover has been shrouded in mystery and many Bolton fans, myself included, remain skeptical about the mysterious investors' intentions. Let's face it, the consortium is not a group of wealthy lifelong Bolton fans who are appearing on the horizon over Winter Hill in shiny armor to save the club they love.

There's probably an ulterior motive, driven by financial gain.

In football, fans are always the lifeblood of a club and demand transparency from the boardroom. I understand why that's neither practical nor realistic, although I'm in favour of a fan-elected board member representing the fans in the board room.

What I don't understand is why anyone would invest in any football club, let alone Bolton wanderers in its current predicament.

The way I see it, to run a football club in a way that makes sense financially, you have two options:

  1. Run the club at a profit and return dividends to shareholders
  2. Chase success by investing in player transfers and wages but run at a loss

In scenario one, the fans (customers) feel like their loyally spent money is going nowhere with the club showing no ambition and being merely a vehicle for lining the shareholders pockets. A club that has money to spend but chooses to give it to shareholders rather than invest in the playing squad soon finds its supporters protesting and demanding ambition (see: Arsenal).

In scenario two, the fans get to see new players and potentially short to mid term improvement in the first teams fortunes but at what cost? As Bolton fans know all too well, the tap will eventually run dry and the investment is a complete gamble with no guarantees. Players get injured, referees make bad decisions and your fate is ultimately out of your own hands, no matter how much money you have to throw at it.

In the Championship, where success equates to promotion to the Premier League and the ballooning fame and fortune that comes with it, the stakes are raised even more. We've seen several clubs disregard the new FFP rules, hoping that if they throw enough money at the problem, they'll be promoted by the time anyone finds out, and will have the money to buy their way out of any sanctions.

To use a Poker analogy, clubs like Nottingham Forest are going "all-in" with a 2 and a 3 before the flop. It's not sustainable and will claim many victims before anyone cares enough to drive genuine change to the system. Indeed, the Portsmouth trust members who attended the BWFCST meeting in January predicted that the Championship is a graveyard in waiting with no sustainability and no end in sight.

And so I go back to scratching my head about what Sports Shield see as their role in Bolton Wanderers Football Club. As investors they have to have one eye on their exit options and return under each scenario before they even consider doing the deal.

Using my methodology above, there are only two ways SSC make money out of Bolton, and that's either by converting us to a self-sustaining model and taking tiny amounts of profit out each year as we trundle along in the football league; or by investing more and effectively sticking all their money on black, with the aim that we make it to the big time and they can sell before the money runs out.

The Supporters' Trust (albeit prematurely, for my personal liking) posed some valid questions to SSC that I fear Bolton fans will never find out the answers to. With the club now doomed for League One football next season, the investment required and timescales for achieving whatever they want to achieve are even less attractive than when they first launched a takeover bid.

Indeed, in the most recent court hearing, it emerged that one of the SSC investors has pulled out of the deal, which could possibly be linked to recent results making it nigh on impossible to avoid the drop. In my view, it's essential that we have people at the top who are willing to roll their sleeves up and are prepared for a tough fight to gain promotion from League One as soon as possible.

Promotion back to the Championship is anything but a given and we need the "investors" to be aligned to that.

Sadly, the days of football clubs existing to serve the local community are long gone and the loyal support that used to be cherished as a 12th man is now merely a revenue stream (see: Leeds United and Liverpool ticket prices). The Financial Fair Play rules are a step in the right direction, but long overdue and not the proper fix that's required.

What a state of affairs the sport has found itself in.