19 March 2013

The £100 million question

by Ross McAdam | Guest Contributor

Brian Stockbridge, Rangers’ Financial Director was reported as claiming the club was hoping to have a turnover of £100 million once we return to our rightful position at the top of the Scottish game. Is this achievable, or is Stockbridge miles away?

Firstly, in 2010-2011 only six clubs in the English Premiership, the world’s richest league, had an annual turnover of greater than £100 million: Arsenal, Chelsea, Liverpool, Man City, Man Utd & Spurs. In stark contrast, in our most recent accounts, seven month turnover was £9.5 million. For simplicity, if we double this, we arrive at a maximum £19 million turnover for the year which is still a long way away from £100 million. Even at the peaks of the Murray regime, our turnover capped around £60 million.

What is clear is that Charles Green is an astute businessman. He has demonstrated that he had big plans for our club. We have recently agreed sponsorship deals with Puma, Blackthorn and if media reports are to be believed the naming rights to Ibrox are about to be sold to Sports Direct, whom we have a commercial partnership with, and none of which are included in this year’s turnover. 

We have been told of the G51 project, where potentially hotels and leisure facilities could be installed. Furthermore, the club shop – four times bigger than at present – will soon be part of the recently purchased Edminston House. 

A further revenue stream which we are continually told will be exploding is the use of Rangers TV. This season we have already had away games shown live on RTV in the U.K. which the club has described as ‘profitable’. Of course, being in the SFL gives Rangers more control over our media rights which may not be as applicable when we return to the top tier. ‘The Rising’ was an incredibly well put together documentary which shows the capabilities the club has in this area. 

If we compare with Everton in 2010-2011, they had a turnover of £82 million of which £53 million came from ‘TV and Broadcasting’. It is clear that we as part of Scottish football could never get anywhere near that figure. A recurring theme in Green’s recent interviews is exploring the opportunity of options outside our borders. 

Many believe that in the perhaps not too distant future these will be commonplace around the world. Should this be the case, one would assume that large TV deals would be executed and Rangers would be able to fulfill the potential they currently have and our turnover would exceed £100 million. 

More importantly however, what can Rangers do now to improve its income? We can never underestimate the size of our support worldwide. Let’s be honest, Rangers are a bigger club with a bigger following than Everton. We have been poor in trying to engage with developing and existing overseas markets.

I was not shocked to hear Shane say on the CROpod recently that he wouldn’t be able to buy a Rangers top in Chicago but could easily purchase a Celtic top. Whenever I go on holiday across Europe it is the same scenario. Go into a sports shop and there is no sign of a Rangers top. This is the real area Rangers need to improve.

Hopefully, through a combination of Puma and Sports Direct we can start to make a change to this. Make no mistake about it; we have a huge following in North America. Our rise this year has been worldwide news which we must take advantage of. 

As has been stated previously, a much larger club shop will soon be in place and a lease has been signed for a shop in Glasgow airport. A further store is being looked at in Belfast so it clear that the club are looking to expand this area of the business. As Stockbridge pointed out, before the JJB deal, Rangers retail operations at its peak brought in £20.5 million with a profit of just over £5 million. 

With correct advertising and the right people behind the scheme (Mike Ashley in particular) there is no reason why Rangers can’t push on and attain even better figures than this. 

Of course, it goes without saying that Champions League money is an essential component in achieving such a high turnover and as things are looking on the park that is a very long way away. However, off the park things are very promising and there is a massive scope for large amounts of growth. 

One can only hope we begin to take advantage of our size and then Stockbridge’s assertion may very well be within our grasp.