Ambition with prudence?- poppycock!!!

[Tumbleweed 106]

Just reading the Pink''Un article on NCFC finances sent a shiver down my spine. So we are supposed to have a Board who claim prudent financial administration and balance the finances, planning meticulously and carefully for future growth?

Well it seems to me that theory has just been blown out of the water. Here they are spending a higher percentage of turnover on wages than Chelsea!! Now we all want them to invest in the team, but it seems to me like they took one massive massive gamble here- virtually of Leeds proportions (as far as its impact on a much smaller club) and had it gone wrong we could well be in serious financial trouble now. I''m very pleased that we got promoted and had a year in the Prem, but I just don''t know what to make of the Board after this.

Are they really prudent or just disguised gamblers??

[Temp the Revelator 0]

In fairness to them though, they did say at the time that they were taking a calculated risk - and that if it failed we would have had to sell players to pay it off.  No-one seemed to mind about that then, I recall........

[DumbleDelia is Magic 0]

The 87% of turnover spent on wages was for the 2003/04 season when we got promoted.  As we finished the season with a £20M golden handshake from sky it doesn''t matter.  We certainly wouldn''t have spent 87% of our turnover last season on wages.  We may have taken a gamble but it payed off substantially.  We bought Hucks, Leon etc who spearheaded our way to the Premiership, where we made a shed load of cash for a season and are on for a nice healthy profit!  Don''t panic!  As a club who hasn''t got that sky bonus year after year we need to take a risk.  As it payed off, I for one am congratulating the board

[BedsCanary 0]

What amazes me is that people still manage to slag the board off for not spending enough money!

[Evil Monkey 52]

Here here DD, well said.

We all knew the risks when we bought Hucks outright, and rather than calling it "poppycock" back then we applauded and cheered the board. Let''s not turn our back on them now, they''ve served us so well.

What is it with NCFC fans at the moment, anyway?! One season in the prem followed by relegation and suddenly:

1) Our players aren''t loyal enough

2) Worthy is a useless manager, and

3) The board doesn''t know what its doing

Compare that to the spirit a year ago when everything was rosey and it just goes to prove how fickle football fans are.........

I may be overly optimistic and positive, but its the only way I know to be as a fan! I jeered those walking out at 4-1 down in the Boro game, sang my heart out moments later, and lost my voice singing "4-1 and you f''d it up" at my Boro supporting housemate (who, in his defence, missed most of the game as he was standing at the away bar getting leathered).

I love Norwich and I''m happy to support them no matter what happens...

City till I die......

[First Wizard 0]

[quote]The 87% of turnover spent on wages was for the 2003/04 season when we got promoted. As we finished the season with a £20M golden handshake from sky it doesn''t matter. We certainly wouldn''t have sp...[/quote]

It also confirms what us pro Hucks campaigners kept going on about DD.

Getting him was a risk, but as we pointed out, time and time again, it was a risk worth taking.

I have a list of you lot who criticised us back then, you know who you are!.

Maybe you''ll think twice before you rubbish us again.......but I doubt it!.  

[DumbleDelia is Magic 0]

[quote]It also confirms what us pro Hucks campaigners kept going on about DD. Getting him was a risk, but as we pointed out, time and time again, it was a risk worth taking. I have a list of you lot wh...[/quote]

I was very much a pro Hucks campaigner Wiz!  IMO bringing him here was one of the most important transfers this club has ever made

[Putney Canary 0]

I''m surprised at how big the gamble was, I didn''t think the board would make such a seemingly big ''calculated risk''. With so many clubs experiencing financial melt down, many having also taken ''calculated risks'', this should be a point of some concern by all. However, we don''t know exactly how big the risk was (we don''t know enough of the detail) so its difficult to know how worried we should be! Does anyone have £400 spare to buy the full report?

My personal feelings are that I place financial stability above league status, the existence of NCFC should never be gambled with.

The board has done a tremendous job in increasing revenues, they should definately be applauded for that. But I would like to know exactly what the consequences of failing to get promoted that season would have been, would it have undone a lot of the good work and turned us from a buying club back into a selling club, and if so for how many seasons?

[First Wizard 0]

[quote]I was very much a pro Hucks campaigner Wiz! IMO bringing him here was one of the most important transfers this club has ever made[/quote]

Thats why I replied to you DD, and used the word us!, you were of course, very pro Hucks, I wonder if the doubters will have the nerve to say they were wrong?.

Doubtful!.

[Saint Canary 0]

I think considering we were at the top-end of the table when we signed Leon, Svensson then Hux permanently it was a risk worth taking.  It was not a particulary high quality league that year and I''m sure Worthy stressed to the board that this was a brilliant chance for promotion.  He may well have even guaranteed that if we signed Hux, City would be up!

[Evil Monkey 52]

[quote]I think considering we were at the top-end of the table when we signed Leon, Svensson then Hux permanently it was a risk worth taking. It was not a particulary high quality league that year and I''m s...[/quote]

And I think he would have been right too... I''m not saying our season was a one-man show, because everyone gave their all for the cause, but Hucks'' appearance and subsequent signature seemed to lift everyone else that extra level required, and the confidence it gave the players was, and still is, immeasurable...

[Tumbleweed 106]

Perhaps Putney canary has explained my thinking more accurately than I was able. I was simply surprised that they had taken so large a gamble. Great- it paid off that time, but many others have taken a similar route and failed with severe consequences. We are continually being told that the Board believes in financial prudence, but the scale of that investment is remarkable.

Bedscanary- yes, its been an eye opener so hopefully an end to complaints of lack of guts/balls/money.

How about a new mantra for City supporters: Please Board, will you spend LESS money. Now that may well be a first!!

[Temp the Revelator 0]

Ok Wiz, I believe I spent a lot of time getting splinters out of my butt during the ''sign hux'' period, as I spent so much time sat on the fence..........but I will admit that I was wrong to doubt the impact of signing Hucks in such a gamble - history has proved that.

However, I do think the extent of the gamble has proved me right to have doubted the wisdom of the move - had Hux got injured in his first couple of games and we had blown promotion, it would be a very different story we were looking at right now........

[USAcanary 0]

This whole thread proves that we have a great club who knows exactly how to look after the finances.

I am amazed by the comments of Tumbleweed who obviously had not thought this through.

Delloites comments were taken out of context of our obvious promotion game plan.

Lets do the math.

We are comparing the ratio of wages to turnover of Fizzy to Prem.

Well duh... You get an extra 20 million a year in the prem, even with an increase in wages one would think (?!) that the ratio would go down somewhat.

How risky was it when the reward of prem/para payments was put against increased wages plus the fact that any shortfall would be met by selling players if we were

not promoted. Delloites comments were based on long term strategy not including sellling players, Our board had all the bases covered thats obvious from the comments. 

In retrospect our strategy may have been a little conservative (but not as much as people think). Others spent more than us in the prem and went down with us.

Personally I think Worthy and the board got it spot on in the players they bought/kept and money spent. Its just unfortunate that some of the players did not perform as well as they could have done.

Worthy and the board learned a lot on this campaign, they will be much stronger going forward and much better prepared when we get promoted again.

[Tumbleweed 106]

But USAcanary there is never any guarantee of promotion. Lets face it we have a great history of blowing great footballing positions- remember relegation in 95 when we were 7th in the old Fisrt Div?

Its not a gamble if you can say with certainty that you will get promotion. But we cannot say that, this is why the figures surprise me.

Also, the argument about selling players doesn''t wash because its premised on the fact that we then sell the players to offset our overspending. Well, we would then have to replace those players. And we would presumably replace them with inferior ones because they would be cheaper. So if we failed to get promotion thatyear with the better, more expensive players, how can inferior players stand any more chance? Thus we slide a bit further down the league.

I never thought I would have any issue about player investments. I am not complaining now as things worked out OK, but am genuinely taken aback at the extent of the money spent.

[chicken 0]

What amazes me is that all this time people exactly like Tumbleweed have slagged off Worthy (allthough he doesnt decide how much money he is going to get) and the board for not taking enough risks.

Now when the truth comes out that they have been taking risks thats not right!

I think these people are now in a deep hole and deserve to be quiet for a while because they have proven to be nothing more than premiership class whingers.

Some of us like DD, Wiz and I have been accused of having yellow tinted vision, the truth is we just have a lot more faith in the club in front of us. Maybe thats because we remember the times when this club had a grey cloud cast over it?!!

In any case I am quite fed up with the people who keep coming on here and slagging the whole club off left right and centre and then refusing to come back and admit that they are wrong when statements like this are released.

I was for Huckerby being signed, but can also remember a lot of people saying that the board were not adventurous enough etc etc etc. They kept saying the same thing even after we signed him. It also supports what I have suggested is the long term financial solution the board may have and reflects the reasons for little prem spending money during last season.

I for one welcome the new era of this club - the future is bright, the future is yellow and green!

[Tumbleweed 106]

What a lot of self righteous nonsense chicken. You obviously have not noticed that 1st Wizard constantly slags off the Board, are you simply trying to curry favour?

I asume you were not surprised at the level of the investment, but I would have expected more from you than this.

[CambridgeCanary 0]

There were risks taken, of that there is no doubt  but the risks were such that if they failed, retrenchment not disaster loomed.  In business terms it was a calculated risk showing a good balance between investment and success.

If promotion had not been obtained then most players would have stayed, some would have been superseded such as Iwan and Malky and perhaps youth rather than purchases would have filled the gaps.  No Helveg or even Ashton but no panic sales no administration and no disasters either.

Even with hindsight, the board seem to me to have got it about right then.  Whether they should have spent more to stay in the Prem is another matter and we can debate that in a year''s time.  In the meantime, my verdict - job well done!

 

Helveg Must Stay !!

[bobfleck 0]

I''m sure Tumbleweed is big enough and ugly enough to look after himself, but I would like to post in his defence anyhoo. When I saw the wages/income stats the other day, I was utterly amazed that a board constantly peddling the ''prudence with ambition'' mantra could take such a ''calculated risk.'' Alright, so it paid off handsomely, but as someone else in the thread rightly pointed out, what would have been the consequences had this ''gamble'' - er, I mean ''calculated risk'' - not come up trumps?

Regardless of the rights and wrongs of what the board did, who can''t say that they weren''t even a teensy bit surprised at that report?

Lets imagine for a moment that the board had approached the fans with their plan - sign Huckerby and, yep, we have a cracking chance of getting promoted, but should we not, then financial meltdown awaits. It''s a no brainer. I''d rather have a football club.

I thought when we signed Huckerby we could actually afford to do so - but perhaps we couldn''t? Or maybe we could? Matron, my medicine please....

 

[USAcanary 0]

This whole thread misses the point

The article was comparing Prem clubs and fizzy clubs, apples and oranges.

If the prem clubs did not get the extra 20 milion plus they get by being in the prem, their income/wages ratio would also be high.

Duh!

Its not the fact that these clubs are more prudent than us, its that they have more income.

Anyone wanna bet our income/wage level this past prem season was a lot lower than our promotion season.

With 20 million extra coming in I would bet my house on it even including the increase in wages this year.

 

 

 

[USAcanary 0]

[quote]There were risks taken, of that there is no doubt but the risks were such that if they failed, retrenchment not disaster loomed. In business terms it was a calculated risk showing a good balance bet...[/quote]

 

There were risks taken, of that there is no doubt  but the risks were such that if they failed, retrenchment not disaster loomed.  In business terms it was a calculated risk showing a good balance between investment and success.

If promotion had not been obtained then most players would have stayed, some would have been superseded such as Iwan and Malky and perhaps youth rather than purchases would have filled the gaps.  No Helveg or even Ashton but no panic sales no administration and no disasters either.

Even with hindsight, the board seem to me to have got it about right then.  Whether they should have spent more to stay in the Prem is another matter and we can debate that in a year''s time.  In the meantime, my verdict - job well done!

 

Helveg Must Stay !!

 

Exactly, spot on.

Thats why its called risk/reward, how often does anybody in business get any reward without risk. Its almost never heard of.

It was calculated, just as their prem campaign was. Worthy and the board admitted had we stayed up our shopping list would have been very different.

They had already planned for both outcomes. Sounds like we have people who live in the real world running our club.

I am very proud of where the club is at today. 

The thing that people don`t understand is that to have a "prudent image" is helpful in two ways.

When you buy players, clubs will not try and overcharge you, players wont rape you on wages.

When you sell players, they know you are not "desperate to sell"

The promotion plan was a nice balance and well calculated. It was either going to advance the club greatly to the prem or put us back a little.

Nice risk/reward ratio . Norwich is now in far better shape than in our promotion season.

 

[shropshire canary 0]

There are 2 points to consider/remember regarding this "gamble".

1. It was very calculated and actually controlled - it began with a 3 month loan spell for Messrs Crouch, Huckerby and Harper. If this had not left as within spitting distance of the top of the league then the "gamble" would have been over, and no purchases of Hucks, Svensson and Mackenzie proportions occured.

As it was we were in that position so a second calculated "gamble" could and did take place.

2. Remember also that we went through 3/4''s of that season without a South Stand - a reasonable impact on turnover against which these percentage based calculations have been worked out. Put the costs of that same "gamble" against a more reasonable turnover expectation given this and it won''t have lokoed half as dramatic as it does.

All in all it gives me continued confidence that the balance seems to be about right in the Boardroom decision making at the moment.

[sxcanaree 0]

As has been said often "there are lies damn lies and statistics".

Deloitte''s review is nothing new - All of us who invested in the club in 2003 have had this data in our possession since the publication of the Annual report in December.

From this august tome it can be seen that of the £12m spent on Staff Costs, the Loan Players accounted for £700K and promotion bonuses were £1.65m - giving a figure if promotion had not been achieved of £8.6m from a turnover of just under £14m. i.e. an underlying ratio of a very prudent 61.6%. if we had not been promoted. - In fact this figure was actually down from 2002/3 where the ratio was £8.8m part of £13m (67%).

The player part of this is actually shown in the report - with promotion bonuses 52% without 42% - less than half of Deloitte''s "lazy" 97% - perhaps next time instead of compiling statistics from the accounts only they will read the annual report as well.

The Loan signings were the only gamble but the impact of those players was immense (and this is not including Hux).

I am gald that Shropshire Canary has pointed out the lack of the South Stand for 3/4 of the Season - this will have had a substantial impact on the turnover - I think it was only about 400 away fans for 2/3 of the Season as opposed to 4000 the Season before. This year we too have averaged sell outs of a much larger stadium - approx 95% on average this will have increased the revenue for 04/05.

Yes the Board can be very proud of their Ambition with Prudence motto....and stick two fingers up at Deloittes report.

OTBC.

[Tumbleweed 106]

Maybe I should draw a line under this thread by thanking everyone for their contributions and perhaps the final point does go to Shropshire who rightly points out the low attendance  because of the South stand redevlopment having an adverse effect on turnover.

A thought provoking debate and something different from much of the usual transfer speculation drivel. It will be an interesting summer........

[USAcanary 0]

Agree 100% with the last 2 posts by Shropshire and sxcanaree

I think its worth saying that if this is the worst thing that some fans can complain about we are in very good shape as a club.

We could always swap places with Leeds Utd or Notts Forrest, then we really would have something to moan about.

 

 

[Putney Canary 0]

All very interesting! For some reason I can''t see posters names against each post, so I don''t know who has said what, but;

- very good point about the south stand development and subsequent lower capacity at CR. It would have been madness to lower expenditure on players, thus decreasing quality of the ''product'', the year before increasing capacity and needing to attract more customers. So for that year we should only expect to see an increased % of turnover spent on wages. Thanks!

- The person quoting the annual report - if I understand you correctly, you are saying that the 87% figure drops to 61.6% if we remove promotion bonuses? I couldn''t quite follow your maths (not my strong point). If correct it answers the original question on this thread positively and is exactly the sort of info Deloittes should be talking into account. Thanks for the detailed response!

- the persons saying ''duh'' and saying we shouldn''t slag off the board - reread the thread! I don''t see any slagging off on this thread, only valid questions being asked which seem to have been answered. Any team (regardless of division, this a % figure we are talking about!) that regularly spends 87% of turnover will end up in financial trouble. Tumbleweed and I showed surprise at the extent of the spending that year, based on the headlines from the Deloitte report vs previous comments about ''prudence with ambition''; which the figures above show the Deloitte report to be misleading. I for one am happy again; the board does seem to have made an excellent decision which showed an immediate return, they didn''t take an overly large gamble with our club''s future, I can remove my surprise and go back to feeling very proud of our club, board and management, and trying not to think about summer transfers again!

[blacko 0]

Well done Shropshire, I was reading all the messages thinking everyone had missed the point, ie our capacity and therefore turnover were down and blow me just at the end, up pops the reason it looks foolish.