A series of Premier League clubs are set to return to their playing squads and press for wage cuts rather than deferrals in order to survive, in the ongoing stand-off about pay.
The players are currently ‘hardline’ in their insistence that they do not agree to any cuts, with the collective preference for any money to go the NHS or charitable causes.
It is increasingly felt this is noble but unrealistic, however, as many clubs – including some in the top six – are now seeking to impress on their players the severity of the situation. One executive has privately talked about how the game is “facing unprecedented challenges that nobody could have predicted”, that will force fundamental shifts in how clubs structure themselves financially.
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While most of the emphasis in recent weeks has been on the potential loss of broadcast money, Premier League clubs are increasingly concerned about the the medium-to-long term effect on a series of other revenue streams.
There is worry that many of the finance options – like specific financing companies – used for season tickets won’t be there going forward, and could mean thousands not being taken up. There is also fear the restricted climate will see companies no longer spend so much on extras that are not essential, such as corporate boxes and premium seats in stadiums.
One big-six club has 40 boxes up for renewal this summer, and are increasingly concerned they won’t be taken up.
Premier League executives are worried this could lead to the loss of millions of pounds per game, as there is also incremental revenue on everything beyond the seat.
Force majeure in many sponsorship contracts will meanwhile ensure many bonuses are not paid.
“The financial black hole is going to be massive,” one source sad. “There are going to be huge shortfalls which simply can’t be made up. It is why they have to go back to the players, and why mere deferrals are meaningless. Player wages are the current biggest expense, but that was from the pre-Coronavirus economics. It’s unsustainable now.
“Deferrals actually cost a player nothing. For a club, though, it’s just debt down the road. Players simply need to have their salaries cut.”
A key principle for the players has been that billionaire owners should be putting their hands in their pockets before anyone, but connected sources maintain this is not possible for the majority of Premier League clubs, such as Watford and Bournemouth. Extra money is needed now, which is why many will return to the players with a harder line.
“Players need a reality check,” one source said. “This is just going to lead to many of those out of contract not getting renewed, and they won’t be able to get anything like their current money elsewhere.”
It is an issue that is likely to only get uglier.
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