The importance of Premier League status and the costs of relegation
The Premier League is one of the best leagues, and playing the Premier League is something desired by almost every team in the English football pyramid. But there are the highs of playing Premier League football, and the lows of playing in the Championship. So, let’s look and analyse what they are.
Relegation clauses
One of the things that can financially ruin a club is if you don’t implement relegation clauses in your player’s contracts, otherwise you would be overpaying for a player that nobody wants to buy. Furthermore, the failure to implement relegation clauses can also prevent the team from making a sizeable profit when selling the player.
Sunderland
Sunderland have been officially relegated to League one, but when they got relegated to the Championship last year, they did not put any relegation clauses in their player’s contracts. The likes of Jermaine Defoe were sold for free and Jack Rodwell, who doesn’t even want to play for Sunderland, is getting paid £60k per week. Their inability to offload their players or make reasonable cuts on player’s wages is what’s left Sunderland in ruins, apart from other things.
West Brom
Despite Darren Moore’s recent heroics as West Brom’s interim manager, West Brom’s season has been nothing poor of shocking. While they’ve been performing poorly on the pitch, they’ve also been performing poorly off the pitch. West Brom’s recently appointed chief executive Mark Jenkins, stated that he was “shocked” by the club’s finances and that “there was no more money for wages.”
Furthermore, similar to Sunderland, West Brom were very complacent and put very low relegation clauses. According to Ian Dennis from BBC Sport, the likes of Salomon Rondon has a £8m release clause, whereas Johnny Evans only has a £3m relegation release clause. While the club should not have such high clauses to discourage interested parties, you certainly can’t have such low clauses to the point that you’re making very little profit from selling your best players.
TV Money
TV money is arguably one of the main reasons of why Premier League clubs don’t have to keep on rising their ticket prices. Instead of “pricing out” fans by raising ticket prices, Premier League clubs simply can use the TV money to cover their expenditures. According to Sky Sports, last year’s Championship playoff between Huddersfield Town and Reading was worth a staggering £290m. The figures are mainly comprised of getting promoted to the Premier League and then staying up in the first season, otherwise they would receive “parachute” payments.
Richard Battle, senior manager in the sports group at Deloitte, stated that the main reason that playoff finals are worth so much is because of the rising TV broadcast deals in the Premier League. Furthermore, most of the rising payments has to also do with the rising financial gulf in the Premier League, with a team finishing in the bottom half of the table receiving £95m to £100m from TV money alone.
A game every 3 days
Unlike the Premier League where it’s a regular occurrence to have a games every week, teams in the Championship usually play a game every 3 games. On top of that, unlike Premier League who play 38 games, Championship sides play 46 games, and start the season earlier. All in all, playing in the Championship is just far more brutal than the Premier League in terms of fixtures.
Building an audience
What makes playing in the Premier League so desirable apart from playing against the best is building a global audience that watch you play. Unlike the Championship, more countries will have Premier League TV rights, and the Premier League has a further reach to the biggest markets out there. Unlike the Championship, when the largest audience in the playoff final, the Premier League consistently yields a large audience, and is able to continuously build the league.
All in all, the Premier League nowadays has so much money that it comes to the point that one match can determine the next 10 years of a club. There’s so much money that can be gained from playing in the Premier League, but so much that can also be lost when relegated.
