Mikeonlythebestwilldo
Player Valuation: £20m
Good read and brilliant information Esk looks like the club have finally turned a page for the better in so many ways
Homepage Update: Why watching Everton in a new stadium need not be any more expensive than Goodison Park.
- Thread starter The Esk
- Start date
- Status
bizzaro
LOVE GOT JUST THE WAY IT IS #ALWNV
Why watching Everton in a new stadium need not be any more expensive than Goodison Park., by the esk
One of the fears for the bulk of fans when moving to a new stadium is the threat and usually the reality of increases in ticket prices.
This may seem particularly relevant in the case of Everton, partially because of the economic demographic of the fan base, but also as you will see below the comparison of match day revenues generated per spectator per season.
So, I started by looking at the average amount of match day income each of the peers’ group generate per fan per season (based on match day income/average attendance – 2014/15 season).
Club Average matchday income per spectator (2014/15)
Chelsea £1709
Arsenal £1667
Liverpool £1276
Manchester United £1155
Tottenham Hotspur £1147
Manchester City £947
Everton £495
On the face of it quite shocking, and immediately alarm bells might ring that with such a gap to be made up, significant price increases may be necessary.
Now there’s a huge number of contributory factors for the above including but not limited to the currently small executive/premium seating capacity, high percentage of season tickets v overall capacity, season ticket discount schemes and numbers of concessionary spectators.
Everton have done a good job over recent years of making Goodison Park as much an affordable experience as they realistically can, especially for our younger and more senior season ticket holders. However the cost to this policy is obviously in the revenues generated for the club.
I believe it’s extremely important though that we continue to attract children and young adults to the game (to refresh the fan base for future years) but also, especially given our history and our standing in the community, make the game affordable to the more senior spectators, many on fixed incomes who frankly could not afford price increases of any form.
Whilst we need to look for new supporters and regular visitors to fill the stadium each week, I think retention of our existing support is vital, and right – especially if we can enter the winner’s circle once more.
So how can the income per spectator be improved without making the match day experience so unaffordable as to take the club out of the financial reach of current fans?
- Large increase in executive and premium seating
- Reduction in % of season ticket holders v stadium capacity
- Attracting more “walk up” and non-regular fans to the stadium
I’ve taken a leap into the dark and made the following assumptions:
- We build a 52,500 seat stadium with 5,000 executive/premium seats and 20 additional boxes
- Season ticket prices remain the same, executive/premium seats cost an average of £200 per game, other tickets average £50 per game and executive boxes cost £75,000 per season – all inclusive of VAT
- The model uses the existing ratio of junior, under 22’s and seniors amongst our season ticket.
- Assumes we would sell out each game and have 35,000 season ticket holders.
- Assumes 2,500 away supporters at each game paying £30 a head.
- 10,000 non season ticketholders and “turn up” supporters at each game.
- No consideration of cup games/European games for ease of calculation
- No consideration of merchandising income
The above model would produce income as follows:
Income generated ex VAT
Season ticket holders £10,260,000
Executive boxes £1,250,000
Exec/premium seating £13,854,000
Away supporters £1,197,000
Non season ticket sales £7,917,000
Total £34,478,000
From the above, the average match day income per spectator rises from £495 to £657, still a long way behind our peer group but achieved without an increase in cost to the majority of our core support.
How does the income stack up against the costs of building and financing a stadium and what does that mean for cash flow going forward?
I’m going to look at debt levels of £100 and £150 million repayable over 30 years at 6%, and the resulting cash flow. For the purposes of this article the cost of the stadium and the capital contribution are put to one side. The assumption being this is met from a capital raise in the form of equity by Moshiri.
Amount of debt Annual cost Cash flow (revenues = £34.5m approx)
£100 million £7,200,000 £27.3 million
£150 million £10,800,000 £23.7 million
£200 million £14,400,000 £20.1 million
What is clear from the above is that a new stadium can be cash generative, yet cost no more for the core support. However it is conditional on two main factors.
Firstly we have to sell out each game to achieve these figures. How is that achieved? Well with an attractive team, consistently in the hunt for trophies and competing in Europe – requires investment in the team and the right manager, something we believe is being addressed by Moshiri at present.
Secondly and most importantly it requires a sales, marketing and events team that can sell 20 executive boxes and (in the examples above) sell 5,000 premium seats for every home match. Is that possible? Well an iconic stadium, a high profile manager and potentially successful team will go along way to achieving that, but ultimately it’s down to the complete experience and the effectiveness of marketing it.
So to conclude – we can it appears, have our cake and eat it. It’s possible to build a stadium – and a very good stadium at that, even when partially funded by debt, and produce positive cash flow to assist the club’s activities on the field without causing price increases for our core support.
I hope that fan groups take note, and the board take the same view
The post Why watching Everton in a new stadium need not be any more expensive than Goodison Park. appeared first on GrandOldTeam.
@The Esk 52500 is not big enough esk.
- Large increase in executive and premium seating
- Reduction in % of season ticket holders v stadium capacity
- Attracting more “walk up” and non-regular fans to the stadium
bizzaro
LOVE GOT JUST THE WAY IT IS #ALWNV
He's one person on the internet who's posts/articles I like to read.
This is essentially the premise of the post yesterday comparing Randy Lerner to Everton's needs.
We need to ensure commercial revenues are improved. Its essential. No more Robert Elstone 'cannot compare to other clubs' arguments which is just a smokescreen for poor performance commercially.
Dario Terracotta
Player Valuation: £70m
Why watching Everton in a new stadium need not be any more expensive than Goodison Park., by the esk
One of the fears for the bulk of fans when moving to a new stadium is the threat and usually the reality of increases in ticket prices.
This may seem particularly relevant in the case of Everton, partially because of the economic demographic of the fan base, but also as you will see below the comparison of match day revenues generated per spectator per season.
So, I started by looking at the average amount of match day income each of the peers’ group generate per fan per season (based on match day income/average attendance – 2014/15 season).
Club Average matchday income per spectator (2014/15)
Chelsea £1709
Arsenal £1667
Liverpool £1276
Manchester United £1155
Tottenham Hotspur £1147
Manchester City £947
Everton £495
On the face of it quite shocking, and immediately alarm bells might ring that with such a gap to be made up, significant price increases may be necessary.
Now there’s a huge number of contributory factors for the above including but not limited to the currently small executive/premium seating capacity, high percentage of season tickets v overall capacity, season ticket discount schemes and numbers of concessionary spectators.
Everton have done a good job over recent years of making Goodison Park as much an affordable experience as they realistically can, especially for our younger and more senior season ticket holders. However the cost to this policy is obviously in the revenues generated for the club.
I believe it’s extremely important though that we continue to attract children and young adults to the game (to refresh the fan base for future years) but also, especially given our history and our standing in the community, make the game affordable to the more senior spectators, many on fixed incomes who frankly could not afford price increases of any form.
Whilst we need to look for new supporters and regular visitors to fill the stadium each week, I think retention of our existing support is vital, and right – especially if we can enter the winner’s circle once more.
So how can the income per spectator be improved without making the match day experience so unaffordable as to take the club out of the financial reach of current fans?
- Large increase in executive and premium seating
- Reduction in % of season ticket holders v stadium capacity
- Attracting more “walk up” and non-regular fans to the stadium
I’ve taken a leap into the dark and made the following assumptions:
- We build a 52,500 seat stadium with 5,000 executive/premium seats and 20 additional boxes
- Season ticket prices remain the same, executive/premium seats cost an average of £200 per game, other tickets average £50 per game and executive boxes cost £75,000 per season – all inclusive of VAT
- The model uses the existing ratio of junior, under 22’s and seniors amongst our season ticket.
- Assumes we would sell out each game and have 35,000 season ticket holders.
- Assumes 2,500 away supporters at each game paying £30 a head.
- 10,000 non season ticketholders and “turn up” supporters at each game.
- No consideration of cup games/European games for ease of calculation
- No consideration of merchandising income
The above model would produce income as follows:
Income generated ex VAT
Season ticket holders £10,260,000
Executive boxes £1,250,000
Exec/premium seating £13,854,000
Away supporters £1,197,000
Non season ticket sales £7,917,000
Total £34,478,000
From the above, the average match day income per spectator rises from £495 to £657, still a long way behind our peer group but achieved without an increase in cost to the majority of our core support.
How does the income stack up against the costs of building and financing a stadium and what does that mean for cash flow going forward?
I’m going to look at debt levels of £100 and £150 million repayable over 30 years at 6%, and the resulting cash flow. For the purposes of this article the cost of the stadium and the capital contribution are put to one side. The assumption being this is met from a capital raise in the form of equity by Moshiri.
Amount of debt Annual cost Cash flow (revenues = £34.5m approx)
£100 million £7,200,000 £27.3 million
£150 million £10,800,000 £23.7 million
£200 million £14,400,000 £20.1 million
What is clear from the above is that a new stadium can be cash generative, yet cost no more for the core support. However it is conditional on two main factors.
Firstly we have to sell out each game to achieve these figures. How is that achieved? Well with an attractive team, consistently in the hunt for trophies and competing in Europe – requires investment in the team and the right manager, something we believe is being addressed by Moshiri at present.
Secondly and most importantly it requires a sales, marketing and events team that can sell 20 executive boxes and (in the examples above) sell 5,000 premium seats for every home match. Is that possible? Well an iconic stadium, a high profile manager and potentially successful team will go along way to achieving that, but ultimately it’s down to the complete experience and the effectiveness of marketing it.
So to conclude – we can it appears, have our cake and eat it. It’s possible to build a stadium – and a very good stadium at that, even when partially funded by debt, and produce positive cash flow to assist the club’s activities on the field without causing price increases for our core support.
I hope that fan groups take note, and the board take the same view
The post Why watching Everton in a new stadium need not be any more expensive than Goodison Park. appeared first on GrandOldTeam.
Cheers Esk,as informative as ever mate,looks like happy days all round,however all that concerns me though is the Chang,Warm Chang,no unnecessary price hikes please Mosh
The Esk
Player Valuation: £70m
I knew I should have sent it to compliance first
Actually I wrote the article on a plane last night long-hand and made some calculations along the way, so there's no spread sheet. However, I'll give you the assumptions I used:
Season tickets:
Assumed current sales of 30,000 with 4,000 children sales @£99, 3,000 senior sales @£299, 6,500 U-22 sales @£299 and the remaining 16,500 sales at an average of £550.
I then used the same ratios for my predicted 35,000 season ticket sales in a new stadium.
20 Executive boxes @£75,000
5,000 Executive/premium seating average @ £200 per seat
2,500 away supporters @ £30 per seat
10,000 non season ticket or walk up sales average @ £50 (I'm of the view that there should be less discounts available for non season ticket sales, and very limited discounts for walk up sales unless we are way short of capacity).
All of the above should produce the figures quoted in the article - there's some rounding in the final figures.
I think the point though is most important - it is not necessary to increase ticket prices following the build of a new stadium if the balance between premium pricing and regular pricing is achieved.
I take the view that a football stadium should be like a commercial plane, if you can sell out 1st class and business seating you will make a profit and can be competitive in economy. The key is in pricing and selling of the premium seats.
The Esk
Player Valuation: £70m
I think I've just proved a 52,500 seat stadium with no price increases for the bulk of the support is big enough mate.
The Esk
Player Valuation: £70m
royalblue66
Player Valuation: £70m
Nice.the warm Chang will be chilled by the breeze off the Mersey mate
52k is more than enough, for now, we would struggle to fill that for more than 3-4 games a season and thats being very kind.
Granted as we moved forward that number would change when the Reals and Bayerns come to town, but thats not for now.
Granted as we moved forward that number would change when the Reals and Bayerns come to town, but thats not for now.
bizzaro
LOVE GOT JUST THE WAY IT IS #ALWNV
Not really, its not 'future proofed'.
Given the massive capital expenditures involved its not something that the club wants to be revisiting once every 5 years or even every decade.
Sapie88
Hi @Donald Twain
Mate I love reading your work but my brain hurts now.Why watching Everton in a new stadium need not be any more expensive than Goodison Park., by the esk
One of the fears for the bulk of fans when moving to a new stadium is the threat and usually the reality of increases in ticket prices.
This may seem particularly relevant in the case of Everton, partially because of the economic demographic of the fan base, but also as you will see below the comparison of match day revenues generated per spectator per season.
So, I started by looking at the average amount of match day income each of the peers’ group generate per fan per season (based on match day income/average attendance – 2014/15 season).
Club Average matchday income per spectator (2014/15)
Chelsea £1709
Arsenal £1667
Liverpool £1276
Manchester United £1155
Tottenham Hotspur £1147
Manchester City £947
Everton £495
On the face of it quite shocking, and immediately alarm bells might ring that with such a gap to be made up, significant price increases may be necessary.
Now there’s a huge number of contributory factors for the above including but not limited to the currently small executive/premium seating capacity, high percentage of season tickets v overall capacity, season ticket discount schemes and numbers of concessionary spectators.
Everton have done a good job over recent years of making Goodison Park as much an affordable experience as they realistically can, especially for our younger and more senior season ticket holders. However the cost to this policy is obviously in the revenues generated for the club.
I believe it’s extremely important though that we continue to attract children and young adults to the game (to refresh the fan base for future years) but also, especially given our history and our standing in the community, make the game affordable to the more senior spectators, many on fixed incomes who frankly could not afford price increases of any form.
Whilst we need to look for new supporters and regular visitors to fill the stadium each week, I think retention of our existing support is vital, and right – especially if we can enter the winner’s circle once more.
So how can the income per spectator be improved without making the match day experience so unaffordable as to take the club out of the financial reach of current fans?
- Large increase in executive and premium seating
- Reduction in % of season ticket holders v stadium capacity
- Attracting more “walk up” and non-regular fans to the stadium
I’ve taken a leap into the dark and made the following assumptions:
- We build a 52,500 seat stadium with 5,000 executive/premium seats and 20 additional boxes
- Season ticket prices remain the same, executive/premium seats cost an average of £200 per game, other tickets average £50 per game and executive boxes cost £75,000 per season – all inclusive of VAT
- The model uses the existing ratio of junior, under 22’s and seniors amongst our season ticket.
- Assumes we would sell out each game and have 35,000 season ticket holders.
- Assumes 2,500 away supporters at each game paying £30 a head.
- 10,000 non season ticketholders and “turn up” supporters at each game.
- No consideration of cup games/European games for ease of calculation
- No consideration of merchandising income
The above model would produce income as follows:
Income generated ex VAT
Season ticket holders £10,260,000
Executive boxes £1,250,000
Exec/premium seating £13,854,000
Away supporters £1,197,000
Non season ticket sales £7,917,000
Total £34,478,000
From the above, the average match day income per spectator rises from £495 to £657, still a long way behind our peer group but achieved without an increase in cost to the majority of our core support.
How does the income stack up against the costs of building and financing a stadium and what does that mean for cash flow going forward?
I’m going to look at debt levels of £100 and £150 million repayable over 30 years at 6%, and the resulting cash flow. For the purposes of this article the cost of the stadium and the capital contribution are put to one side. The assumption being this is met from a capital raise in the form of equity by Moshiri.
Amount of debt Annual cost Cash flow (revenues = £34.5m approx)
£100 million £7,200,000 £27.3 million
£150 million £10,800,000 £23.7 million
£200 million £14,400,000 £20.1 million
What is clear from the above is that a new stadium can be cash generative, yet cost no more for the core support. However it is conditional on two main factors.
Firstly we have to sell out each game to achieve these figures. How is that achieved? Well with an attractive team, consistently in the hunt for trophies and competing in Europe – requires investment in the team and the right manager, something we believe is being addressed by Moshiri at present.
Secondly and most importantly it requires a sales, marketing and events team that can sell 20 executive boxes and (in the examples above) sell 5,000 premium seats for every home match. Is that possible? Well an iconic stadium, a high profile manager and potentially successful team will go along way to achieving that, but ultimately it’s down to the complete experience and the effectiveness of marketing it.
So to conclude – we can it appears, have our cake and eat it. It’s possible to build a stadium – and a very good stadium at that, even when partially funded by debt, and produce positive cash flow to assist the club’s activities on the field without causing price increases for our core support.
I hope that fan groups take note, and the board take the same view
The post Why watching Everton in a new stadium need not be any more expensive than Goodison Park. appeared first on GrandOldTeam.
Currently only 3 teams in the league average above 52k.
City Arsenal and United.
Our current average is 38,124 from 39,598.
52k is fine.
http://www.soccerstats.com/attendance.asp?league=england
*sees financial post*
*check it's not written by damo*
*read*
Great article esk, and not one mention of a tier 1 stadium.
*check it's not written by damo*
*read*
Great article esk, and not one mention of a tier 1 stadium.
bizzaro
LOVE GOT JUST THE WAY IT IS #ALWNV
Thats the 'mediocrity' accepting thinking with no real inclination to push to be the best.
Instead people want a midling stadium.
- Status
