COVID-19 sport

The battle between football and COVID-19: How will clubs cope with their financial losses?

The ongoing pandemic continues to disrupt the world of sport and football and threatens to spell the end of lower league clubs. Liam Rowsell looks at the impact of COVID-19 on the industry and harsh realities of not having fans in stadia.

In a year that’s seen Bury’s expulsion from the EFL, Bolton surviving by the skin of their teeth, Wigan and Sheffield Wednesday going into administration, Derby being cleared of a suspected breach of Fair Play regulations and now Macclesfield Town being wound up by the High Court, the ongoing global COVID-19 pandemic threatens to cause serious implications for the future of sport and football clubs up and down the country. Understandably, its the lower league clubs who are coming off much worse and will continue to do so as the UK looks to be entering a second wave of the pandemic.

How will COVID-19 affect lower league clubs?

Whilst Macclesfield’s £500,000 debt has little to do with the current climate and more to do with poor ownership, it’s a good sign of just how fragile lower league clubs can be. Clubs competing in the National League are entering very frightening times, given they’re without the luxury of lucrative broadcasting deals that they treat higher clubs to. Instead, a large proportion of the revenue of those lower clubs is generated on a match day with ticket sales, merchandise and food. But without supporters, who are usually at the heart of any sporting event, it leaves one wondering where the revenue will come from.

According to a recent report by Deloitte, the 2018/19 football season saw the 24 League Two clubs generate a combined 91 million pounds from commercial broadcasting and revenue streams, almost three times less than the average Premier League club alone. Whilst it’s a well-known fact that the Premier League is a very lucrative competition to compete in, the lower leagues are far from that. Such an unforeseeable event like COVID could be the tipping point for many clubs who rely on their fans for income.

Arguably, those clubs that view their fans as their most valuable asset are the most likeable clubs within the community. However, with few commercial opportunities available when fans are so detached from the club as they are now, it’s these such clubs who will suffer the most. Many clubs are calling for the support of their fans and local communities at this time but how can a supporter help the club they love this season beyond buying the shirt? Ultimately, solutions will need to be found to allow fans back into lower league football grounds or we will sadly see more cases of expulsion and administration within the English football pyramid.

The recent social distancing experiment held at the Amex a month ago was a success as 2,500 spectators were allowed back into the stadium for the first time since the COVID pandemic to support their side. The stadium was operating at around 10% of its capacity that day, creating a safe environment for fans with plenty of space around them. Even that would be a welcome return for the lower league clubs who would benefit enormously from the ticketing revenues 1,000 spectators would generate each game.

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How long will this problem persist?

Unfortunately, the government have recently announced that new restrictions, including those preventing sporting spectator test events, could be in place for up to six months. And with the UK’s COVID infection rates starting to increase at an alarming rate again, more restrictions may well be on the horizon. The football industry can only hope that these won’t disrupt the sport further.

Despite rigorous coronavirus testing and cleaning procedures within the entire sports industry, including the Premier League and EFL, football players and coaches are not immune from catching the disease. We have seen this within the last week with Leyton Orient, who have had several members of their squad tested positive for the disease, resulting in the postponement of their Carabao Cup clash with Tottenham and their League Two match against Walsall. It also disrupted West Ham during the last week as manager David Moyes and players Issa Diop and Josh Cullen tested positive just an hour before their cup clash with Hull City.

All players with the disease will have to self-isolate, which could heavily affect the rest of the team. Until they find a vaccine, this will continue to happen and it will disrupt fixtures as the season goes on. The only way to ensure a COVID-19 free footballing environment would be to isolate all members of the squad from the external environment, but that would likely have dire consequences on team and player morale.

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What can clubs do to overcome their losses?

At the moment, lower league sports clubs must rely heavily on their local community for support. They exist for entertainment and will be a key part of the community for most. It may take some kind gestures to keep some sides out of financial trouble, as has been seen with the purchase of £20,000 worth of Leyton Orient shirts by Tottenham fans after the postponement of the match. We all recognise the fact that lower league sides may well need support somewhere down the line, and it’s very encouraging for sides like Leyton Orient to know they have the support of the rest of the footballing world.

According to Deloitte’s Annual Review of Football Finance, Premier League clubs could lose up to 1 billion pounds during this pandemic. However, COVID doesn’t seem to have dented transfer budgets as recent transfer activity shows that there is still plenty of money left in the competition as clubs like Leeds United, who have spent plenty on new signings during this window. This may well come as a surprise to many, but shows that if asked to help clubs in the lower leagues, they should be able to oblige.

The most successful players in football should also be able to give support during this pandemic. There have already been many examples of players helping, including Marcus Rashford who has worked hard to develop a scheme to help tackle child food poverty. Many other sports people and Premier League players have contributed to charities or the community and given their huge salaries, should, just like their clubs, be able to help struggling lower league football teams. Those who started their careers at a lower league side will understand the importance of all levels of the English football pyramid, and most would happily help as a last resort to keep a club afloat.

The EFL offers the live streaming service iFollow for all matches not selected for broadcast in the Championship, League One and League Two. Supporters of these clubs can buy a match pass for £10 which gives them live video access to the match online. Clubs are given a percentage of the revenue made from this, and given that fans cannot watch matches in person, many have taken to this service instead. For the lower league sides, who are rarely selected for live television broadcast, this is currently a vital revenue stream.

Ultimately, with football clubs having limited ways of generating any revenue from fans, this problem will probably persist until they allow spectators back into sports venues. Clubs should by now have a plan of action for combatting the financial stress that they will probably find themselves in within the coming months, but with such an unforeseeable event like this pandemic, nothing is certain. We all sincerely hope that no club goes out of business because of this coronavirus pandemic, which has devastated so many already within the world of sport and outside, and that before too long those lower league clubs will rebuild and grow to a sustainable level.

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