Football Trade Directory managing director George Moss was present on Sky Sports News this week to discuss the financial impact for clubs relegated from the Premier League.
Whilst West Ham United’s fate had already been sealed in the penultimate week of action, they were joined by Blackpool and Birmingham City on a dramatic ‘Survival Sunday’ and once the dust had settled, these clubs will now have to come to terms with the harsh financial reality outside of the top flight.
And Moss, who has a wealth of experience in football having been in charge of Preston North End’s finances for several years, believes the drop is as big as ever.
"The gap is greater than ever before, given the Premier League's £3.3bn TV deal from 2010-13, which delivers on average £40m TV money to each Premier League club, while those in the Championship receive £3m," Moss said.
"The inflated parachute payments are designed to ease the crash to the Championship but nevertheless, the impact is likely to follow the time-honoured pattern, there are many examples of clubs such as Leeds United, Sheffield Wednesday and Charlton Athletic to name a few who have found it difficult to get back into the top tier," Moss commented.
Moss’ work at the Football Trade Directory has given him a proficient view of not just the TV revenues that hit clubs, but also sponsorship, commercial and hospitality income.
"Levels of sponsorship, gate receipts including season tickets and income from executive boxes are all likely to be reduced in the Championship, hence the importance that player contracts reflect the second tier. The financial impact of relegation from the Premier League is said to cost a club between £50m-£90m."
"Birmingham have been up for two seasons, but the club's own financial accounts state they have a shortfall of £17.15m even if they had stayed up, this is very difficult to sustain with reduced revenues.
"Blackpool, however, haven’t allowed Ian Holloway to break the bank with the £40m gained from promotion, so they have a much better cushion to fall on in the Championship."