Manchester United case Essay

The UEFA FFP Regulations is about improving the financial health of European football club (UEFA, 2014). The regulation was implemented at the end of 2012 season where all clubs had to abide to the rules and regulations to obtain the license to play in the UEFA Champions League (UEFA, 2010). Deloitte (2014a, p. 2) refers the FFP break-even requirement as ‘a change potentially as profound as that brought about by the Bosman ruling.’

As the problem rise by the decreasing in the number of applicants, the questions rise is the manager is doing a successful job and does he have a marketing plan to keep the club going forward. The managerial skills compared to other competing clubs wasn't in a good rank, they were in

Financial – money coming into the Club, via player sales, sales of match tickets and programmes, club merchandise, subscriptions to SAFC TV (the club’s own on-line TV) and from use of the Stadium as a Conference Venue and for staging Rock Concerts.

We first examined Real Madrid’s revenue streams and found that from their inception through the 1970s their business model was based almost entirely on their ticket sales. After the 1970s up until 2003 they had some media rights, a small merchandising department, and some other negligible streams of income. It was in 2003 that team President Florintino Perez decided to make Real Madrid into a

The role of Manchester United in attracting businesses is very significant. The club can attract businesses itself but can only do this for businesses that benefit from the actual matches taking place, such as pubs and hotels. On the other hand, the club functions as a publicity channel for the region. It draws attention, and is always a good way to start a conversation. In this way, the club has indirectly made a large contribution to bring businesses and investments to the region. The brand name is known all over the world and puts

Player transfers assume a focal part in professional football. Each season clubs attempt to build their squads by keeping their best players, exchanging and/or signing others with a definitive point of building a superior team and improving performances on the pitch. Since the Bosman ruling in 1996, the significance of transfers has expanded and has turned into a key part of each club 's core business. Today, it is exceptionally hard to envision the modern form of the sport without them.

The elite Spanish and English Football clubs have enjoyed the global football explosion over the last two decades. For example, Barcelona and Real Madrid have used revenue generated from Champions League and the Spanish League to buy the best players in the world at very high prices (Markus 45). This has made the teams become the centre of investment for billionaires who are keen to have a share of the teams. It is from this perspective that the professional soccer teams end up overspending in the name of getting hold of the best players in the world. Moreover, some teams such as Manchester United have been reported to be overstretching their budgets by paying massive interests to its players. This results in losses which might lead to bankruptcy and fall of the football team. By analyzing such trends, professional clubs may end up being in unhealthy financial positions, which throated their survival and the stability of football as a global sport (Homewood para. 10). Based on these concerns, there is a need to regulate the spending of football clubs so as to guarantee that there is a level ground for all top division soccer teams in Europe (Dijk 45). This paper analyzes Financial Fair Play regulations and their effects on professional soccer clubs in Europe as well as their prospective effects on the economy.

Tottenham is part of a stable industry where the demand is inelastic due to enormous fan following and is the number one sport followed all over the U.K. People either go to stadiums or watch the matches on the television.

Manchester united, on the other hand, manufactures and sells their products to fans of the football club as this

The ultimate solution for preventing the health of the club’s financial health is to assign

Ever since Glazer loaded the club with £525million debt, over £680million has gone towards servicing the debt, including interest fees, bank charges, and debt repayment as of May 2014. On the other hand, the club’s spending on acquisition of players during the same period was £382.9million while its rivals Manchester City has spent £693.7million, Chelsea £600.2million, Tottenham £448.2million, and Liverpool have splashed out a total of £443.75million. In other words, Man Utd spent more on servicing Glazer’s debt than it did on strengthening its squad. Although Man Utd won five Premier League titles, three league cups, and a Champions League under Glazer’s ownership, underinvestment eventually led to aging squad and failure to find suitable replacements. As a result, in 2013/2014 season, Man Utd finished the season in 7th place, failing to qualify for the Champions League for the first time since 1990/1991 season while its neighbor, Manchester City, won the title. While Man Utd was suffering from severely deteriorated financial situation, Man City, under the ownership of an Arabian prince, Sheikh Mansour, invested heavily not only to acquiring top players, but also to building a new stadium, training facilities, and even to the community by subway construction and new homes. Despite the fact that Man Utd spent £152.3million in the transfer market this season, the investment does not seem to be paying off yet as the team ranks fourth in the league as of

As noted by Lang et al. (2011) ‘sugar daddy’ investments makes big clubs even more dominant within their league. This is because such clubs have more financial capabilities to attract and hire the best talent (Lang et al., 2011) available on rather inelastic marketplace (Madden, 2012). Franck & Lang (2012) decided to analyse the strategic decisions undertaken by ‘sugar daddy’ owned clubs and concluded that these clubs choose riskier investments strategies as compared to clubs without benefactor owners. However they built very limied theoretical framework, whereas they created only ‘one-club-model’ which enabled them to analyse very narrow scope of potetial incentives and implications within broader industry settings. Nonetheless they found that these riskier investments usually take form of overspending on transfer fees and players remuneration. Franck & Lang (2012) also identified existance of ‘too-big-to-fail’ phenomenon which assumes that ‘suggar daddies’ have to inject money to keep the club from bankruptcy only if it acquired sufficiently large market share, otherwsie it is easy to quit and leave the club as a bankrupt. Another interesting issue researched by acadmics was related to the motivation behind acquiring a football club. According to Franck (2010) individuals may seek for positive spillover and higher recognition of their core businesses; they also may seek for political and social acceptability after acquiring their

Real Madrid’s business model has shifted a lot throughout the years. Their main sources of revenue are gate receipts, sponsorships, merchandising, and television rights. One last source of revenue that should not be left out is the offering of public shares of the soccer club. Real Madrid itself is not public, but there are numerous of other top clubs that have attracted investors and are now listed on the stock exchanges.

Despite win percentage variability, Swansea was profitable in all four seasons to such an extent overall as to exceed expectations, but only when considering management’s contribution in the fourth season. Seasons one to three, on the other hand, incurred more modest outcomes. Starting with ten million in capital, the team eventually expanded its net worth to over sixty-seven million. So, even without managerial oversight in the first three seasons, Swansea City remained modestly profitable. This was primarily due to start-up talent levels. Their initial talent level of four was projected to generate a profit of two to eleven million per season, depending on the ATL of division three competitors. In terms of actual results, these projections eventuated to average profits of 9.7 million – which, despite a degree of seasonal variability as seen in Chart C, was in line with expectations overall.

Further to your questions and advice you require about your football club facing currently. This is a common practice in the United Kingdom that football clubs face financial problems due to their debts exceeding their current assets. In recent years, many football clubs went into liquidation, administration process. This situation arises where football clubs are unable to pay their debts because they could not control their massive expenditures. Therefore, they went insolvent or in to liquidation. To sum up this process, the company shareholders passed the special resolution to put the company in to liquidation or administration or Creditors take the matter to court and get the court orders against potential debtors. All processes are done under the common law and statutes such as Insolvency Act 1986 , the Bankruptcy and Diligence etc. (Scotland) Act 2007 and the Debt Arrangement Scheme (Scotland) regulations 2011 and the Company Act 2006. The creditors may arrest your company assets through the process of diligence.