Radrizzani’s strategy may be frustrating but is it the right way to go?

Comment on MarchingOnTogether.co.uk news stories.
Post Reply
User avatar
YorkshireSquare
Site Admin
Site Admin
Posts: 7766
Joined: Sun May 18, 2003 1:34 pm
Twitter: @motforum
Location: Leeds
Contact:

Radrizzani’s strategy may be frustrating but is it the right way to go?

Post by YorkshireSquare » Thu May 23, 2019 7:54 pm



Andrea Radrizzani has warned of a “difficult” transfer window ahead causing much consternation amongst fans. But with losses at over £4.3 million last season and a bigger deficit forecast for this season what can we realistically expect?

The motivation for owning and running a football club are not always clear, some do it for the love of the game, some for the joy of running their boyhood club and some for out and out profit. I suspect for Radrizzani it is the latter, he is a business man after all. But there is not much value or profit in a Championship football club, only potential. Potential of promotion to the Premier League and all the revenues that could bring, especially to a man such as Radrizzani with all of his experience and contacts within the football rights world.

The question is do your run the club as a business, minimising losses and building slowly or do you gamble and invest millions to bring promotion quickly? Clubs that gamble and win can reap the rewards, clubs that gamble and fail are set back for many years. Radrizzani is running Leeds United like a business. Of course he wants to get us into the premiership but he isn't going to risk his own finances to do it. If we get promoted he'll have an asset worth far more than he paid for it, if we don't then as long as he balances the books, pays everyone's salary, including himself, then he is running a successful business.
You invest in the bits of a business that will provide guaranteed returns, buying back Elland Road saves the club millions of pounds a year on rent. Investing in the youth set-up is a fairly low risk as the price of players for the youth side and wages are miniscule in comparison to buying first team players. All it needs is one or two decent players to come through ever season and the investment has paid for itself. Buying players for the first team is a huge risk. Players value can go down dramatically, how much would we get for Forshaw, Bamford and Douglas now? You could spend £15m, pay decent wages and have little return.

The more money you spend the more risk. If you spend £20m upwards on players and don't get promoted, suddenly you have wasted even more money and you still need to buy better players to challenge again next season. A football club can very quickly become a money pit. So Radrizzani sensibly runs the transfer side by only spending the money he recoups from selling players. This is not great as far as the fans are concerned, but sensible as a businessman.



Radrizzani has explored bringing in outside investment, the funds from 49ers Enterprises will have helped in the transfer market or on bringing in Beilsa and his team but tit cost 10% of his stake in the club. Radrizzani cannot continue to give away shares as it decreases the value of his investment and any potential returns he may earn. In effect he is gambling, giving up 10% of the club in the hope that the investment would make the club worth more. But the money has come and gone and promotion has not been achieved. Is he going to sell off another chunk? Would you?

The 49ers investment wasn’t just about cash either. A lot of people underestimate the Championship; how competitive it is and how much it costs to run a Championship team. But bringing in the 49ers is a strategic partnership with a big sports brand who have expertise in merchandising and marketing and can push the Leeds United brand into new markets. The Liverpool owners brought their expertise in from Baseball, having transformed the Boston Red Sox, and Leeds can leverage their partnership with the 49ers in the same way.
There had been speculation that Radrizzani would need to sell the club if we failed to achieve promotion, that he is not rich enough to sustain the loses racked up by a Championship team for too long but he has said; “I’m here and I hope we get there one day and I’m here until that day because I really want to enjoy it with the fans.” If he runs us as a business properly then he can afford us for as long as he wants unless his other businesses fail. If the club doesn't make a loss he isn't making a loss and the value of the club will remain fairly steady and of course there is always the possibility that one year the club gets promoted and his investment is suddenly worth a lot more.

The key to Radrizzani’s strategy is to build steadily. We have the foundations of a team in place who competed for automatic promotion for the majority of this season. They are playing a style of football that reaches right down to the academy sides, academy sides who have had an extremely successful season too. The youngsters we have coming through the academy could be the key ingredients for Bielsa, they have been playing well in his system all season. These youngsters may tick a lot more boxes in terms of what Bielsa needs than any potential new signings. Unless we pick up really good signings on the cheap Bielsa will have to work with what he has, and he has proved how he can get the best out of players.



Many fans have judged this season a failure and have questioned the owners decisions and how much he has invested in the team. The reality is though that we are had and shoulders above where we were previously. The club is being run well off the pitch, money is being invested in the right areas though possibly not in ways which are obvious to the fans. In the past 15 years we have been subjected to Ken Bates, GFH and Massimo Cellino. There have been protests, marches and boycotts. Sometimes I think fans forget just how bad things have been and how much better they are now.

It’s difficult to see other clubs spend a lot of money chasing the big dream of making it to the promised land of riches whilst we have to sell to buy. But the reality is a lot of clubs don’t make it to the promised land and crash and burn in the process. That should not be the norm though, clubs should be self-sustaining and that’s what Radrizzani is trying to achieve at Leeds United. The top three teams in the Championship didn’t “spend big” in the summer and those that did and narrowly missed out are now having to cut their cloth appropriately.

It’s gutting to miss out on promotion this year and I understand peoples frustration at Radrizzani but the club is heading in the right direction and we have every possibility to build on what we’ve achieved this season.
Help the site by making your Amazon purchases through our afiliate link.

Post Reply

Advertisment