http://www.thescratchingshed.com/2012/01/kens-tight-ship-sadly-sailing-towards-iceberg/
So it's January again, and as in July the Ken Bates pre-packed clichés are already flowing. We won't `break the bank' in the transfer market, or risk the clubs financial stability now we can spend some money on players. We'll also hear about those clubs who foolishly spent money in the summer on players, not performing as well as we are (Leicester, Notts Forest etc) conversely we'll also hear how our players need to buck their ideas up, perform better and get us promoted - or else, ditto the incumbent manager. Finally as certain key players reach the end of the current contracts we'll hear how unreasonable they are in their demands - asking for pay rises, add-ons contracts for more than 2 years, and so it's gone for the past three seasons with Bates. Core to all of this is that Bates is running a tight ship, on sound business principles, and that while we as `morons' simply want him to spend some of his multi-million pound fortune, he will not be swayed - I forgot he may also mention something repulsive about intercourse or foreplay at this point, to really repel anyone still interested in the detail of what hes saying.. apologies, just threw up a bit. So it's blame the manager, blame the players - even blame the fans, but never blame Ken Bates or Shaun Harvey for us being in the second division, the business model's rock solid, we must never criticise it.. is it? Let's break it down. Firstly why the model is strong Positives & Potential 1. A loyal and numerous client and customer base On average over 20,000 fans turning up to any home game - even in Division Three - and prepared to pay Premier League ticket prices to watch the likes of Yeovil, Brighton & Walsall. 2. A worldwide historic brand A fan base which the likes of West Brom, Fulham and Bolton would kill for, and achievements in living memory like winning the last first division title and the oft discussed champions league semi. Sky can sell ours and probably only West Hams games around the world in the Championship. Movies are made about Leeds United and best selling books sold. 3. A profitable business for the past 3 years (into the millions) A rarity in football, full stop. And this a business which was in administration no more than 4 years ago (but see points 1 &2) 4. A manager who can find decent players for low fees and sell for much more Part of the above, we have very little in the debit column when it comes to fees or salaries as a proportion of our revenue (as per the football league). Our manager and our scouts do seem to be able to find them (Gradel, Somma, Beckford) - and like Arsenal - sell them well, (generally). Since relegation note a few of our key 'outs' - Gradel (£2M), Schmeicel (£1M), Delph (£6M), Lennon (£4M), Milner (£5M). 5. A strong production line of home-grown talent How much do we think the likes of Howson, Lees, White would go for? More recently look at the likes of Garbutt, Kebbie, Taiwo, Woods - who were coveted even before an appearance was made in a white shirt. Much of our potential financially comes from this; moreover many of our match winning players are home-grown. We seem to excel here, with not enough investment it seems. 6. Large potential catchment area As per point one, in League One, and Championship regular attendances over 20k, are in stark contrast to over 30-35,000 while in the top flight. Leeds were big then, and they could be again. Its often trotted out that we're a one club city (apologies to Farsley Celtic). 7. Readymade facilities for purchase at below market price The club could buy back Elland Road and Thorp Arch for under £30M. The facilities are already purpose built for the training and development of soccer players, and for the playing of football (no one said good football.) 8. Support of Local Council The council, even in these rarefied times offered to loan Bates & Harvey, a loan to buy the ground (despite us having turned a profit for the last 3 years) because they see it as critical to the success of the city that the club has that security. But for the intractable issue of who exactly FSF were Leeds would have secured that loan. Any property developer will tell you such support is like Rocking Horse Poo from a city council, moreover that it is vital if you have ideas about building casinos, hotels, shopping centres and erm. a football team maybe Ken? So just like Craig David. (I could think of no other), Leeds are 'Born to do it' - so why aren't we? Well here's the rub - his name's Ken Bates, and his business model stinks like Boxing Day Stilton left next to the oven overnight. Key blockers and disadvantages (or Ken as we know him) 1. Minimal investment in core business Why do people (including the non-moronic businessmen) turn up to LS11 every other Saturday? To watch football, at best they used to get their business contacts down to see the best football in Europe - and it followed that the better the offering - the more investors you got, the more tv money you got, and the more profits you made. So you need to win games right? To get out of the dead zone Leeds occupy? To be the best you can? How do you do that? - You get the best players you can afford. Here's where it breaks. Despite receiving transfer fees, generally up front (according to Bates & Harvey) Gradel £2M, Schmeicel £1M, slashing the wages of Johnson, Kilkenny, Beckford in the last 2 years from the wage bill, Did we go for the best players available? Did we even replace the ones we sold? No we didn't, and we won't. A club of Leeds' financial stature should compete with a Leicester, a Southampton, even a Barnsley, but we simply won't spend transfer fees to give us a competitive edge. Ken's right, the fees are exorbitant, and perhaps banks won't lend 'speculatively' but we do have cash in the bank, and a turnover to support a promotion campaign - which should be after all what we need to do to get to the next level? Were i involved in credit and lending decisions, and I do have some professional expertise in this area, i wouldn't call Leeds a bad bet at all. Nothing wrong with bargain hunting, but man cannot live by the bargain bin alone, the odd bit of quality needs recruiting. 2. Major investment into peripheral areas So we dont have the money to do that eh? Well what about the £7m of investment in corporate boxes. We morons love to roll that one out, and Ken doesn't think we understand that even though hes got a lease, that most business property is on a long lease and alterations and investments on leased property is often worthwhile if it enhances your business profile and profit margins. It pays for itself right? However whilst we dont have top flight football it's immaterial. The differentials between Premier League and Championship corporate revenues are staggering. It begs the question - has Ken got his priorities wrong? It's often insinuated he owns the ground already - who knows? But even if he did this investment is the wrong way round - why build a fantastic theatre, but then fail to arrange any shows? Or to extend that further, why then arrange shows with anything other than the worst hams, luvvies, and burn outs on the stage? Ken has taken his eye off the prize. Why not; if property is so important buy it outright now? £7m would be sufficient for a deposit (over 20% of the total purchase price) and mortgage the ground for 30 years? Then spend your money; the whole thing looks a mess. 3. Lack of clarity to customers as to direction of business- We're a successful profitable business, yet we dont spend money on transfer fees for players, we dont compete with the best - even in our current league, and we dont hold on to our best players and tie them to decent contracts. So are we profitable or not? What is this dreadful `foreplay' in which we're engaging and what is the desired long term outcome? We just dont know - and it smacks of total disrespect to the fans (who are the clubs major financial backers) It also speaks volumes to the business community. Our ownership structure remains opaque at best, and exactly where do the transfer fees, the inflated ticket prices, sponsorship money, tv cash etc go? Where and how does it get spent? 4. Visible dislike of key client/customer base How can we forget being called 'morons?' It ranks with Ratners faux pas about selling 'crap' - you just dont slag off your loyal customers, some of them may even be investors. Ken Bates comes across as a malodorous, repulsive despot, of the worst kind. A misanthrope, who wants to bleed the club dry with little regard for the fans. Many fans have begun to vote with their feet, he just doesn't seem to care, or want to change his ways - there are no olive branches offered, and no `plan B' to get us promoted. 5. Failure to attract serious investors and business partners No Matthew Harding, certainly no Roman Abramovich, apparently no one wants to invest in this climate. erm. apart from Marcus Liebherr at Southampton less than 12 months ago, the Thai backers of Leicester City, Hull's backers (whoever they are? Birds Eye I suppose?) These all of course in the Championship, let's not forget the major investment into Man City, Paris St Germain, Liverpool. Football clubs that are profitable, that have a large fanbase are the plum ones to buy - mysteriously apart from us. Wonder why that is? Would you lend Ken £10? I wouldn't. Would you buy a used car from him? So why might you give him £70M lets say, to buy a football club, the phrase `magic beans' would be running through your mind as an investor as you handed the unkindly old gent that cash - would you own the club? The ground, the players contracts? Credibility is everything in business and Ken exudes a disingenuous and antagonistic air, he is a dreadful ambassador for the club. Litigious, cantankerous and out of touch. Just ask fans of Aston Villa about Doug Ellis, they felt then as we do now - like no one will ever buy their team while hes around. Ken Bates is the man who demanded to see 'proof of funds' from Roman Abramovich - bjesus. Who called the recently deceased Matthew Harding 'evil' - really? 6. Open criticism of internal management and staff from the top In what business is it acceptable to openly slate individual members of your staff and management? Ken Bates has opinions about individual players and their efforts. McCartney, Kilkenny, Johnson, Beckford have all felt the rough edge of his tongue, and with the exception of Kilkenny have all gone on to play for successful teams, generally at a higher level. Sour Grapes doesn't do it justice. Moreover Ken slags off his manager's capability. Whether this is reverse psychology, garnering support from the fans, or just that hes a grumpy old man is moot. You just don't wash your dirty laundry in public - not in any business. And you don't demotivate your employees. But hey if customers are fair game - what do you expect? A parting thought Perhaps this is extremely biased, well it is, and it's only one fans opinion. Is Ken Bates totally to blame for where we are? Well not entirely of course - we're not a very good team, so that limits our chances of promotion. But he's the man with the plan - as it were. And that plan seems totally devoid of creativity, belief or credibility. When we look at that underperforming team, and at the bench for hope at 2-0 down - remember we can only deploy the resources we are afforded by the chairman - we don't have access to the full profits we make, or the leverage of our reputation, and notions of where we ought to be as a team. That is something the businessman in charge is paid handsomely to achieve. If the club really were in such a bad state - would he really have stuck around as long as he has? Written by Matthew Brown-Bolton © 2012, The Scratching Shed. All rights reserved. _______________________________________________ Leedslist mailing list Info and options: http://mailman.greennet.org.uk/mailman/listinfo/leedslist To unsubscribe, email [email protected] PETE CASS (1962 - 2011) Rest In Peace Mate
