Why are my club in debt?

[NEO-BAHAMUT-]

Can anyone help me? I'm in my third season managing Hemel Hempstead in the Vanarama National League South, since joining i've drastically dropped the wage budget due to it being 2k over for 6 months or so. This season I was given a wage budget on 10k, which was 3k less than last season. 10 games in they have now dropped it to 5k. When looking in to my finances - the past couple of years have been horrific and i've no idea why. We are 500k in debt and no matter what I do we are losing money every month.

I've even been to the board and downgraded all my facilities. I've finished in the playoffs twice and currently 3rd halfway through this season. Can anyone see or help as to why we are losing money as a club?

 

 

[Thebaker]

your wages are still too high both player and staff. In a good month you seem to be 5k short and in the summer months probably 20k short of a profit. The best bet is to get more fans into matches or a very good FA cup run to improve the finances.

The further into debt you go the more interest you will pay making it worse, its why you have paid nearly twice as much interest this season verses last season.  You have been spending money you didn't have on wages the last 2 years, the fact that the board gave you that figure didn't mean that the club could afford it.

[NEO-BAHAMUT-]

I could be in this position for a while then. I've just started doing friendlies to earn 2k per game but only when i've got a week between league games. Its hard to get out of this league but i dont think there will be much difference in money / crows in the National League?

In regards to player wages, i dont think i can go any lower. Im trying to keep the team i've got and most of them aren't signing contracts :(...

Edited November 13, 2021 by NEO-BAHAMUT-

[isignedupfornorealreason]

Oof, some mismanagement going on with those wages.

 

A star player on an appropriate £275 but then an Important player is on £525, which £225 over the advised maximum allocated. And then a Squad player on £300! That's mad.

Always ideal to follow that wage structure and stay in the wages budget (you're what, almost £1k over?), it'll help.

[Thebaker]

6 minutes ago, NEO-BAHAMUT- said:

I could be in this position for a while then. I've just started doing friendlies to earn 2k per game but only when i've got a week between league games. Its hard to get out of this league but i dont think there will be much difference in money / crows in the National League?

In regards to player wages, i dont think i can go any lower. Im trying to keep the team i've got and most of them aren't signing contracts :(...

you will likely get bigger crowds adn with some teams a lot bigger from away fans so it can make a difference, also there you would be nearer to later rounds of the fa cup and more money.

[Prepper_Jack]

Well, you've done a pretty good job of trimming. I might say that killing off youth recruitment/coaching wasn't probably necessary, as it was already a very small portion of your budget, but overall you've taken it from a loss of nearly 400k a year to down around 75k. Great improvement on controlling player wages. Main problem is that VAT tax and loan interest. In other countries, you'd have income tax, not sales tax, avoid the hit and make a profit.

You'll probably get some investment at some point come in, or maybe even a takeover. You might be able to turn it around by increasing income. Schedule lots of friendlies against larger sides at home whenever it's suitable should definitely help. I'd hope you be able to gain more than 2k per match, though. Might be able to comb through youth teams to try and find a newgen wonderkid to sell for a big profit, but it's a long shot.

[NEO-BAHAMUT-]

Thanks - This is a big learning curve for me in the game. I've taken a below par team with stupid wages to a top of the table team always challenging for top spot on a very reduced wage budget. Alot of my players would do well up to league 1/2 level so trying to keep them is proving to be difficult. I had a take over last season but its not made any difference. Is it possible another take over could happen?

Im hoping i can go up this season and next, then maybe find a couple of players to sell. Its a long shot though like you say @prepper_jack. And thanks for acknowledging what I have done despite still being in a poor state

[oblongata21]

I'd try and cut a few of those high wage players and go for some loan deals that dont require you to pay huge wages. I'd also focus on youth recruitment and see if you can get a few young players coming through the ranks and keep them on youth contracts as long as its viable. Try and get as many friendlies with better opposition as you can and try and make cups your priority to get income.

Good luck

 

[FrazT]

The staff wages seem very high in relation to the players wages, so have a look at them and see if you can make cuts there

[Prepper_Jack]

Dunno, 112k a year in staff seems like he basically has some scouts and coaches. Probably axed the HoYD. Hard to trim off 75k a year from that, considering the scouts alone probably costing 30k a year, and those are kind of important to have around.

Really think what's needed is to generate more income in whatever way possible. Stoking some rivalries may help with match day attendance, if that is an issue. Recently played a friendly with a local rival Premier pro team as some bottom tier semi pro team. Collected something like 25k in gate receipts, as a lot of their fans came to watch the match. Talking a lot of smack before a match can also boost attendance. In the long term, making sure you have a lot of exciting games seems rather helpful. So, lots of chances created and goals, as few want to come watch people park the bus.

[NEO-BAHAMUT-]

@FrazT I have offloaded all the dead wood in my staff and now I only have the bare minimum that the board will allow. I’m sitting top of the league at the moment so should things go well I’ll be in The National League next season hoping to see more fans. I have a 3k capacity stadium and only get between 600 and 900 spectators. So that may help. I’m worrying for next season though what ever happens as would the board give me a bit more in wages to attract the better players?

I feel like the only quick way out of this is make it to league 2 and sell a few players off to earn it back. Failing that I’m going to have to leave probably which I don’t want to do. I’ve become quite fond of Hemel Hempstead.

[MrPompey]

A quick tip to make money, play as many friendlies as you can at home against much better opposition to try and generate attendance income for the games

[NEO-BAHAMUT-]

Yeah i've been trying to do that without tiring my players out to much. 

15 games left of the season, im 4 points clear at the top and my board have just reduced my wage budged from 5k to 4k. This is getting ridiculous and worrying at the same time.

 

If this was to carry on its obviously going to get worse and worse.... can the club go in to liquidation or even sell the stadium? or is the game programmed to never let a club get in that state and they get bought out?

Edited November 14, 2021 by NEO-BAHAMUT-

[Thebaker]

promotion to L2 is unlikely to help much with the debt as the club would be pro and the costs would much higher as a result, attendances would increase but not that drastically.

You need to get money in, get rid of any high earners among the players and find cheaper players even if they are not as good, getting better players in is not really an option. Do the same with the staff.

Eventually the club will go into receivership with probable points deductions after reducing the budget repeatly, the club is likely to be sold and new owners come in.

[NEO-BAHAMUT-]

My plan is, if i can get them promoted this season and debt isn't sorting itself out then ill resign and let someone else take it on . Just as we start talking about take overs this has just come through. Hopefully something does come off.