Albion relegation could cost businesses millions Knock-on effect if fans stay away after club’s humiliation
BUSINESSES are bracing themselves for a huge financial headache which may run into millions of pounds following West Bromwich Albion’s relegation.
While the club itself expects a £45 million loss on the playing side, the knock-on effect for hotels, caterers, pubs and businesses is not yet clear.
But the loss of Premier League status is likely to equate to fewer away fans and visitors to the region on match days.
Paul Faulkner, chief executive of the Greater Birmingham Chambers of Commerce, said the local economy would inevitably suffer as a result.
“While it is difficult to measure the impact of West Bromwich Albion’s relegation in terms of pounds and pence, there are some potential knock-on effects for the West Midlands,” said Faulkner, who knows the Midlands football industry well, having spent four years at Aston Villa as chief executive.
“Playing in a bigger competition against bigger clubs inevitably attracts more out-of-town visitors who come to the region and spend money on match days.
“There are also well-documented social benefits for the region in having successful football clubs.
“Ultimately, it is hard to put a financial value on success and failure.
“But, in terms of publicity for the West Midlands and overall regional confidence, it is a major positive when all of our teams are doing well.”
West Midlands Growth Company, which attracts regional investment and encourages tourism, said it would investigate the commercial consequence of West Brom’s relegation. Birmingham will be without a single Premier League representative next season, for the first time in the competition’s 26-year history, if Aston Villa fail to win promotion via the play-offs.
The Baggies’ eight-year stint in the top-flight finally came to an end last week when Southampton beat Swansea City.
But director of football administration Richard Garlick said widescale redundancies were unlikely as the club already operated with a relatively small workforce.
West Brom were 27th in the latest Deloitte Football Money League, with a revenue of £140.4 million for the 2016/17 financial year.
A spokesman from Deloitte’s Sports Business Group said: “In their first season in the Championship, the club will receive approximately £40 million in parachute payments.
“This will partially offset the loss of minimum Premier League central distributions of circa £90 million.
“In the 2019/20 season, the club can expect to receive in the region of £35 million from the Premier League, and approximately £15 million in the 2020/21 season.
“The club will likely see a financial impact on matchday revenue and associated income.
“It could also see a reduction in commercial deal values.”
Chief executive Mark Jenkins said the club would endeavour to rebuild and that he hoped a cut in season ticket prices would be seen by fans as a “statement of intent”.
“It’s a big challenge,” he said. “But it can also provide us with an exciting opportunity to rejuvenate the club and write some exciting new chapters in Albion’s story.
“We have much to do this summer to get us in the right shape for our immediate target of making as swift a return as possible to the Premier League.
“Relegation stings us all but the hurt is all the more damaging if we do not learn from the mistakes which have brought us to this point. It is my task to ensure that happens.”