Monday, July 17, 2017

General Manager Will Need To Increase Income To Justify Their Salary

Hereford FC's decision to appoint a General Manager is understandable given that the club is continuing to grow.

There's a feeling that there is a need for a suitably qualified person to ensure that the club can function profitably whilst, hopefully, climbing up the divisions. Part of the remit will be to develop new revenues and continue to build relationships across both the city and further afield.

To be fair, there's only so much time the current directors can give to the club given they are not paid. Having someone full time at the club will allow the directors to concentrate on taking the club forward and not worrying quite as much over day to day matters.

However for a club with a turnover of £1M, the salary for a decent general manager must be in the region of £40/50K. On top of that are NI contributions and probably some sort of pension scheme.

So, in effect, a general manager will need to ensure income at the club rises by at least £60K per season simply to pay their salary. 

Where will this £60K come from?

In essence it can only come from admission charges or other income such as sponsorship, replica shirts, perimeter boards, catering etc.

But at a time when the income of most supporters is not even keeping up with inflation, there's only so much the club can increase admission charges even if the club continues to climb up the leagues.

There have already been some comments on the decision to charge £10 to go to a Fans Forum with manager Peter Beadle even though a meal is included in the price.

And as one director told BN yesterday, it's not that easy to increase the income from catering given there is so much competition across the road in the Old Market.

For example those supporters with Waitrose cards can have a free cup of coffee before or after a game. And to be fair it's more drinkable than that served up in the club's catering booths.

It's probably easier to try and raise a little more income from sponsorship and perimeter boards. Again if the club continues to climb the leagues then increases in these prices can be justified to advertisers because of increased exposure. Getting into the Conference or National League as it is now sometimes called is important not only for the level  of football but for the level of media interest which in turn creates more advertising opportunities.

However, even if everything goes to plan on the pitch, it's difficult to see how an extra £60K of income can be obtained without exploring some 'new' avenues.

There may be some mileage in charging supporters to listen to Radio Hereford FC. The argument for this is quite simple. Those listening are able to keep up with all the action on match days for nothing whilst those attending in person are paying.

Obviously there will be many supporters who listen who will say that they can not attend games in person because they live too far away or perhaps have to work on Saturdays. They may also point out that they support the club in other ways by purchasing shirts or taking part in the HUST lottery.

There was a period when some output from the former club was only available on Bulls Player. Is it time to consider something similar?

Up to 1500 supporters are said to listen to the games on Radio Hereford FC. Perhaps the average for say 50 games in a season is 1000 per game. To charge £1 per game would bring in £50,000. Obviously there would be set up costs and no doubt some supporters would not wish to pay for this service. But even if that figure of those listening dropped to 800, it's still around £40,000.

Another possible income stream is to transfer the 50/50 matchday draw back to the club. Or perhaps at least share the income between HUST and the club. Whilst this would hit HUST's time scale to purchase it's 50% holding in the club, it would give the club an income of around £15K per season if shared.

A third way might be to agree some sort of deal with clubs for pre-season friendlies at their grounds. Taking a percentage of the gate could bring in several thousand pounds. 

The extra income needed for the salary of a general manager has to come from somewhere and maybe these are three ways at least worth considering. Hopefully there will be others.

However the money is raised, it has to be done somehow. The club has to balance the fact that it must live within its means and yet provide manager Peter Beadle with a sufficient budget to enable him to put together a squad capable of another promotion.

Everything has to be paid for. And it will in the remit of the new general manager to ensure that there is enough income to do that. 

Meanwhile letters have been sent to those applicants for the new position who have not made the shortlist.