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Chester in big trouble

Knutsfordian said:
This isn't just about poor budgeting and financial mismanagement. What it shows is that progression to higher levels brings a vicious increase in costs that can't be met via crowd funding alone. There comes a point at which progress inflicts so much financial damage that the club is no longer sustainable - but would the fans accept a voluntary relegation back to (say) Evostick South to play at a sustainable level? A poor season at any level can wipe out any balances and reserves (which it seems Chester had in place) but the higher the level the more severe and speedier the impact. I think every non league club without a millionaire backer runs this particular risk.
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They went full time trying to compete without the money to back it up.

They're spending £450k PA on wages!!!!!
 
Why!!??
Why on earth would you commit to such an outlay knowing your projected income falls well short!
Surely they must have known what the outcome would be.
In all honesty I have no pity for them, if you are going to go at the league your in, in such a way, then they deserve exactly what they are getting.
Its not as if they have been unlucky in any way. Its all been planned as such!!
 
Do they still see themselves as a League club & feel they need to try & get back at any cost?
 
Edge said:
Do they still see themselves as a League club & feel they need to try & get back at any cost?
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But could that cost be another reformed version playing much further down the leagues!!??
 
They'll probably find the cash to survive., rebuild within their means over the summer but struggle in Conf North.
 
josh89 said:
Hopefully winning the vase would give us a nice few quid, is there any Tele money available to clubs in the final considering its on bt sport?
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Check the prize money list; not quite the pot of gold other competitions bring. I don’t think the Tv money would be especially generous either. An appearance at Wembley would be more about another note in our club history and a great day out (nothing wrong with that) - still many more hurdles to negotiate before we can dream of Twin Towers. I’m digressing from the discussion point of the thread too :D
 
I think your probably right Edge, but my point is that whether you accept a promotion or relegation to the league above, or below, it doesn't necessarily mean that you are in, or stay in, full control of your finances. There are too many variables.

Lets take just one example. Gates are budgeted on a regular gate of 250 with home games fortnightly. Over the winter period the weather turns bad and no home games for say 2 months (extreme I know) and the postponed fixtures get rearranged so that you end up with 3 games a week in the last month of the season. So immediate issue is cash flow with expenses and costs still being incurred and income taking a dive. If you can bridge the cash flow problem you then face the issue of 3 games a week when attendances are likely to be less than they would have been if they were played as they fell due and hey presto the budget is blown and at best reserves are eaten into. At various points in this scenario the Committee/Board would have to take decisions. Do you off load players at the first sign of trouble? That could leave a weakened team and failing to fulfil fixtures and maybe relegation?

I suspect the Board at Chester aren't as naive or daft as some may think - just that the risks of hitting debt go up as you go up the leagues.

So is it stick or twist?
 
That's a fair point about games being called off, but has that happened to Chester this season?

It seems they budgeted for £10k a game income & only get around £7k but that doesn't explain the huge losses.
The £9k a week wage bill is more of an issue.
They also had £100k rainy day fund but that's been blown as well.

More reading here -> https://alloutfootball.co.uk/50k-or-bust-a-sorry-state-of-affairs-at-chester-fc/
 
I don't know the absolute details at Chester - I was just giving an example and perhaps should have added "hypothetically speaking" to the beginning of the first sentence in the second paragraph to make this clear.

The article you reference is obviously written by a fan, angry about what has happened but obviously committed to the cause. In the second to last paragraph he/she notes "Once we are out of this predicament, it’s time to change paths and use this wake up call to get investment into the club. I would suggest a 50-50 or 51-49 split between City Fans United and said investor. Simply the best of both worlds" To me that's a tacit admission that's its almost impossible to have a fans owned club, without major investors, playing in the top echelons of non league football.

Don't misunderstand me, I am not having a dig at 1874 or any other fan owned club. I am just trying to make the point that even with the best of intentions and directors who have previously run a steady ship, the spectre of debt always looms and can be realised a lot sooner than anyone might realise.
 
Indeed. Cue reference to German model of 50%+1 fan ownership at the higher levels.
 
@Knutsfordian Didn't see it as a dig at all.

We're lucky that the majority of our fans know at least 1 or 2 board members & we're a family. Chester appears to have a them & us situation with little or no knowledge of how the club is run and who is running it..
 
I’ve little sympathy with Chester. To my mind they became lazy and didn’t build on their early success. They have made poor decisions like sacking managers too quickly, giving Jon McCarthy a contract extension too early and then sacking him, installing Wi-fi in the stadium, giving 30 game extension clauses to players they can’t afford, offering a flexible 10 game season ticket with only 11 home games left, offering two year contracts they can’t afford.......the list goes on.

Fans own does work if you have willing and capable volunteers plus learn to live within your means. Just look a few miles from Chester and there is a non league club 3rd in the national league, who are trading in the black, have raised over £60k through fans donations to buy players and got 8500 at their last game.

I really hope Chester survive but they need to sort out this mess themselves rather than ask others to help.
 
Knutsfordian said:
Mmm - but wrexham made some significant losses in the past as a fans owned club
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Wrexham didn’t make losses under the fans owned model but cleared off the debts of previous owners. About £800k i think. The point is they sorted it out themselves and are in good shape. Chester started with no debt and have got into a mess.

My point is fans owned works 100% with the right people running the club and the fans backing it.
 
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Green Dragon said:
My point is fans owned works 100% with the right people running the club and the fans backing it.
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Agreed, GD. It's about the way a club is run and the support it has, whether it's fan-owned or not. There is nothing wrong with the fan-owned model, as I have seen some people suggest on the National League Facebook page.

Ultimately, I have very little sympathy for Chester. I would never wish any club to go under but in their case, it would appear that they haven't learnt from the mistakes of the past. They should get themselves out of their mess, not rely on the goodwill of others.

It's not like they didn't have a head start over us either with their own ground, a solid 2k fan base and even getting to start in Evo Stik One North rather than at our level. Appreciate that costs go up as you go up the leagues but then they should have been aware of that and cut their cloth accordingly.
 
Don't suppose anybody has a copy of their accounts to see what they pay for the ground they use.
 
pdw said:
Don't suppose anybody has a copy of their accounts to see what they pay for the ground they use.
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Phil. I have previously posted that they were paying CWAC something in the region of £25,000 per annum (a ludicrously small sum) for the use of the whole of the Deva Stadium about 4/5 years ago. This was the figure from the then Chief Exec. Mike Jones obtained under the Freedom of Information Act. It may be more now, but it seems unlikely that CWAC's Officers would be seeking a more realistic sum from them in view of their bias towards Chester FC and their perceived lack of support for football in the East of the region.
 
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