The cost of not being in the Premiership

The year after relegation, Forest were favourites to return to the Premier League, with a good squad and in a relatively strong financial position, given some moderate investment. We all know what has ACTUALLY happened on the pitch in the 8 years since - let's examine the financial cost.

Forest could not have dropped out of (and stayed out of), the Premiership at a worse time. This page illustrates the losses in potential revenue through not being in the Premiership, with figures starting the year Forest were initially relegated (98-99).

Figures
Average Prem revenues vs Forest's actual revenues.

Sources & Notes
1 http://football.guardian.co.uk/comment/story/0,9753,1009392,00.html
2 https://answers.google.com/answers/threadview?id=710613
3 http://en.wikipedia.org/wiki/Premier_League
4 http://news.bbc.co.uk/1/hi/business/5032978.stm
5 http://football.guardian.co.uk/News_Story/0,,218819,00.html (98-99 figures - used to extrapolate 99-01).
- The Figures in red are estimates / extrapolation from previous years. If you can find the actual figures, please contribute in our forum
- Div 1 revenue is average revenue for the league now called "The Championship"

Discussion
Average Premiership revenues have increased exponentially since '99, almost entirely due to rocketing television revenue from Sky and recently Setanta Sports. As a result, the cost of relegation in '99 and the failure to regain Premiership status is almost incomprehensible. The simple calculation above illustrates that by the end of next season, the loss in revenue compared to the average Premiership club will approach the HALF A BILLION pound mark, over just 9 years!

In depth analysis

Best case scenario from now on
Let's take the following rediculously optimistic scenario, as offered by Mark Arthur in June 2007.

Forest are promoted this year, promoted next year and then begin to challenge for Europe when in the Premiership.

Challenging for Europe would clearly mean a revenue amongst the leagues "average teams". In this fantastical scenario, the earliest Forest could achieve an average Premiership revenue would be 2009-2010.

Starting from the year Nigel Doughty became involved, the following table illustrates lost revenues. Premiership revenues will remain relatively stable for the next couple of years, as the latest Sky/Setanta contract was a 3 year deal.

However, there will be some increases, for instance the £1.7bn TV deal due to start next season has already risen to £2.1bn due to new mobile and internet contacts. For that reason we have increased expected income per club by £5m p.a. (a very conservative figure). We have also allowed Forest a considerable increase in revenues for the two supposed promotion seasons.

So, even if we obtain two promotions and then finish in the top half of the Premiership in 3 years, challenging for Europe, failure to regain Premiership status under Doughty and his administration has cost the club well over £550million, in just 10 years.

Even the most hopelessly ill educated fan knows that this scenario is never going to happen, so with that noted, be aware that every year we remain outside the Premiership, it now costs the club almost £100m in lost revenue. Kinda makes the arguments over £10m for a new Main Stand seem a bit inconsequential, doesn't it?

What if we we're a lower Prem / yo-yo team?
Let's ignore Mark Arthur's spin and set our sights a little lower. When being relegated in '99 (earliest figures we could find), Forest received less than the average Premiership revenue, as you would expect from a club finishing bottom of the league (£17,003/£33,650 = 49.47%).

You could argue that Forest are not going to be an "average Premiership club" and lost revenues should be compared to worst Prem clubs. In that case, lost revenues are "only" around £200m to date (fig includes the 8 years which Doughty has been at the helm).

Of course, potential losses in coming years are still rising at an extraordinary rate. Taking into account this article, you will see that lower Premiership teams are now receiving a larger piece of the pie (% wise) than they have in previous years. Next season, the team who finishes bottom of the Premier League will receive £30m in prize money, 60% of the figure awarded to the league winner (£50m). In 2005 this figure was 53% (£16m/£30m).

In short, even hovering around the bottom of the Premiership is worth a phenomenal amount of money.

Removing the big 3
Many people reading this may be wondering what percentage of this "average income" is taken up by the top clubs. Let's see.

Taking one year (03-04), and looking at the top 3 team's revenues as a % of total;

Man U = £172m
Chelsea = £144m
Arsenal = £114m
Total top 3 = £430m
Total = £1300m

Remaining total for other 17 clubs = £870m
Average without top 3 = £51.18m
Average with top 3 = £66m
Difference = 77.5%

So as you can see, the top 3 clubs don't actually take up a rediculously large % of the revenues. A top 3 constitutes 15% of the league's clubs and only takes up 22.5% of the revenue - not vastly disproportionate at all.

Who says it would be better under anyone else?
We've stated at the top of this page that you can never tell what might have been if someone else had been Chairman instead of Nigel Doughty. For that reason you have to take these figures at face value. Assess what you think could and should have happened and work out a figure for yourself.

Again though, note the following.

• Forest were bookies favourites to be promoted in 99-00
• The two previous times the club had been relegated in recent times, they bounced back at the first time of asking (both times via automatic promotion). This was the case even under the much maligned Bridgford Consortium.
• Between 1957 and 1999, Forest spent 35 of 42 years in the top flight (83.3%) and 21 of those seasons in the top half of the top flight (50%).

Again, non of that information guarantees anything but it's information non the less and the more of that you have, the more educated a judgement you can make on a situation.

Summary
Does this section need a summary? I don't think it does, as if you've actually read this page you understand the seriousness of the situation.

Suffice to say, new stadiums and talk of ambition are just fine and dandy but when Doughty took over we were a fringe Premiership club and we now sit 2 divisions below it, with absolutely nothing to indicate that we will EVER get back there under his guidance.

As a Forest fan does that worry you? It should.

We are getting left behind. This should be our only focus - spend money on the squad to achieve Premiership status. If you have read the rest of this site you will know that the club has spent a net figure of MINUS £7.17m since being relegated from the Premiership and have spent a grand total of £850k on summer signings in the last 8 years.

Doughty has proved time and time again that he wishes to do things on a shoestring - the only way that is going to change is if the fans make him change by putting on the pressure. As fans we need to demand genuine investment in the playing squad and demand a genuine display of ambition to reach the Premiership - NOT JUST TALK FROM MARK ARTHUR.

Talk is cheap - failure to regain Premiership status is bloody expensive!