CREATING a profit-generating football club takes as much hard work from the administrative team as it takes for the players and coaching staff to win on a weekly basis.
CREATING a profit-generating football club takes as much hard work from the administrative team as it takes for the players and coaching staff to win on a weekly basis.
According to the West Australian Football Commission, which owns the West Coast Eagles and the Fremantle Football Club, the future of football in WA is much brighter than it was 18 months ago, due to both on and off-field success, which has included the payment of some hefty bills.
WAFC’s major bugbear is a $34 million debt owing on Subiaco Oval. WAFC chief executive Wayne Bradshaw said the commission wanted to halve that figure in the next five years.
“The State Government pays $1.5 million a year and we are paying in principle the interest, which is about $2.8 million,” he said.
“We are working on reducing that debt at the moment and that is where naming rights come into it. We want to reduce the debt by half in the next five years.
“Crazy John’s is no longer interested and we are now looking for new sponsors. The council was an impediment but we are in discussions and we are looking to proceed.”
Mr Bradshaw believes a naming sponsor will be secured within 12 months.
The naming rights issue is one of five key areas of the WAFC financial management plan drawn up last year. Just two of the five remain to be ticked off.
The WAFC’s other four goals were: to undertake a debt restructure; improve the performance of the FFC; obtain fixed royalty payments; and increase AFL funding.
A debt restructure has reduced interest payments and the FFC will post a profit of about $500,000 this year (it lost $4.5 million in the past two years). The WAFC has gained an extra $350,000 from the AFL, taking the 2003 tally to $1.3 million.
The WAFC is currently in discussions with the West Coast Eagles and the Fremantle Dockers to arrange a new royalty payment system.
Currently the WCE pays 80 per cent of its profits to the WAFC, with the FFC expected to start paying 80 per cent of its profits to the WAFC in 2005.
It’s a system WCE chief executive Trevor Nisbett is keen to change.
“If we have a surplus of $2.7 million, about $2 million of that goes to the commission. Plus we pay rent, which is in excess of $2.5 million a year,” he said.
“We will only keep $700,000 this year and we try to accumulate that. It is a difficult task, particularly if you want to spend a lot of money on infrastructure.
“We would like a sum we could pay on an annual basis that includes rent and that would lower the amount we have to pay. By having a fixed cost it gives us an incentive to make money for the club.
“It is important to us because if you’re competing with 15 other clubs such as Collingwood, which has a capacity to make $2 million, and Essendon with $2 million a year, they can buy the best coaches and they can go to Queensland for a four-day training stint.”
FFC chief executive Cameron Schwab was undecided on what structure would best suit the club.
“Once we have a better understanding of the profitability of the football club we will be able to decide that,” he said.
“It is very early days for us yet and we don’t know how far profits could go.”
The 2003 season has proved a defining one for the Fremantle Dockers, with the club reaching its first finals campaign, a feat that is matched by an anticipated first-ever profit for the club.
Mr Schwab said the success this year was largely due to the previous year’s restructure.
“If we’d gone into 2003 with more of 2001 it would have been very difficult for us. We had our biggest loss in 2001 ($2.5 million),” he said.
“In 2002 we built up the hope and expectations. We got aggressive with our recruiting and we won nine games.
“We’ll make a profit this year of about $500,000.”
In 2002 the FFC formulated a three-year strategic plan that contained the following four priorities: to be financially viable; to win a premiership; build a brand ethos; and to be a successful decision-making organisation.
The club hoped to win a premiership in the next seven years, according to FFC chairman Rick Hart.
“It’s a great challenge because we have to build a football team based on a selection of young footballers,” Mr Hart said.
“We’ve had the advantage of being on the bottom in previous years, which has allowed us to get good draft choices.
“What the coaching staff would want to do is keep those players in the system for seven to eight years. You grow a 20-year-old up and they peak.
“Eventually you need to be competitive and be in finals. The most successful clubs have won multiple premierships.
“In the next seven years the club will be a serious contender and we will hopefully win a premiership; then the 10-year cycle starts again.”
Both the Dockers and the Eagles believe that on-field success drives up member numbers, which fuels its business.
To foster membership growth both clubs and the WAFC are keen to grow participation and interest among school children.
Mr Bradshaw said encouraging school teachers to see the benefits of football in terms of building confidence and physical activity was a priority.
“The focus now is on the development of football in the State and our catchcry is to grow the game,” he said.
“We’re restructuring the junior development system and directing resources to the area in particular participation and getting football back into the schools.”
Mr Bradshaw is aware that the battleground with other codes is in the hearts and minds of young people, and he has taken particular interest in the growing popularity of soccer.
“Soccer is making inroad,” he said.
“We are looking at educating parents that footy is not a dangerous sport.
“The media has a lot to do with that. We need to let them know that images of James Hird’s face gushing with blood is not the norm.”
And the battle against other codes also plays out on a sponsorship level, according to Mr Nisbett.
“We are in competition with other codes and obviously the Rugby World Cup [in October] will have an effect,” Mr Nisbett said.
“A lot of companies only have so many dollars to spend on corporate hospitality and if they decide to spend that on the Rugby World Cup they might not have money to spend next year.
