Pressure on Potters’ owners as O’Neill takes over at Stoke

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The Coates family, owners of Stoke City, cannot afford to make another mistake after making Michael O’Neill their fifth manager in 22 months.

The implications of relegation from the Championship to League One were obvious in the recent demise of Sunderland, Bolton and other former Premier League clubs.

Relegation to League One cost Sunderland over £5million in lost revenue at a stroke.


Chronicle Live revealed that demotion wiped more than £5m of revenue streams in an instant,  with a steep drop in both EFL solidarity payments and also the league’s basic award payment.

In the Championship, clubs are due a flat payment of £2.084m which encompasses their share of the television broadcast deal. Unlike in the Premier League, this is not linked to final league placing and there is no prize money.

This drops starkly to just £677,000 a year for clubs in League One, while clubs in League Two bank just £472,000.

Championship clubs also receive a solidarity payment from the Premier League which is distributed from their whopping multi-billion pound TV deal. Clubs in the Championship receive £4.3m but it drops to £645,000 for clubs in League One.

These are figures from 2016-17, but that would still represent a £5m loss in revenue and illustrates how much League One and League Two are the poorer cousins of the top two divisions.

In League One, Sunderland would be making just over £1m from centralised payments. They made £150m for finishing bottom of the Premier League a couple of seasons ago.

Of course, the salvation for the Black Cats is the continued parachute payments. They would bank around £33m the season after relegation and would stand to receive another £15m in the third year following relegation.

The other form of revenue is based on how many games are selected for live TV. In the Championship a home club banks £100,000 for every home game which rises to £120 and £140,000 if a TV game is on Sundays or Thursdays, respectively. For an away game it is £10,000.

In League One, home clubs make £30,000 for a live TV game. Deloitte Sports Business Group estimate relegation costs clubs approximately £50m in Premier League distributions alone.

Premier League clubs receive roughly a £90m share from the league each season. That’s money generated from TV revenues from domestic and foreign markets.

While relegated teams receive a £40m parachute payment, there is still a large shortfall for clubs to make up.

As well as the reduced TV revenues, relegated Premier League clubs will also suffer financially in matchday revenue and incomes associated with that, such as hospitality. Commercial deals with sponsors could take a hit too.

In being docked nine points with immediate effect, Birmingham City became the first club in the Championship to be punished under the division’s Profitability and Sustainability rules for breaching spending limits.

With the Blues having breached the limit by a little under £10m, the 12 point punishment was reduced to nine points which saw them lose almost £48.8m across a three year period between 2015 and 2018. 

The Premier League investigated Aston Villa last year after the club sold their stadium to comply with financial fair play rules.

The Midlands club, like a number of rivals, sold their stadium at the end last season in order to comply with the EFL’s profit and sustainability rules.

In the short term, the plan worked with the EFL signing off Villa’s finances as being compliant with their FFP rules, but the Premier League appeared to be less satisfied.

The report claimed the Premier League’s investigation was focused on the value of Villa Park, which was sold for £56.7m to NSWE Stadium Limited, a company controlled by the club’s owners Nassef Sawiris and Wes Edens.

Writing on behalf of the board last season, chief executive Christian Purslow admitted FFP regulations would provide a significant challenge while Villa remained in the Championship.

But he added, “the directors are actively seeking to implement actions to avoid future breaches of financial fair play.”

“The directors believe they will remain compliant with the EFL profit and sustainability rules for the 2018-19 season.”

It is a picture that illustrates how vital it is that O’Neill manages to keep the Potters in the Championship this season.

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