Eels Blogs

So we’ve all seen that finally we have a deal in place with Parramatta Stadium that at least guarantees eight games per year at Parramatta Stadium. However, as Cagey pointed out in another blog, the question is what about the other home games we’re giving up.

Before I go any further, the knowledge I’m using I’ve based on asking a whole bunch of people over the last month about Stadium income and the like. None of this is official information, it’s just bits and pieces I’ve picked up from various directors, managers - past and present. Don’t take any of the figures as gospel and then and therefore understand the assumptions I’ll make along the way are subject to me not having complete and accurate information.

Basically, how the Stadium agreements work (or at least have worked, I’m not sure if new agreements supplant any of this information) is at Parramatta we basically manage everything. We’re responsible for hiring all the security and manning the ticket booths and the like. We have the opportunity to sell the signage and complete control over the corporate sponsorship. Revenue is dependent on the ticket sales. As such, it is possible we can host a game at Parramatta and lose money. Games where we’re getting crowds at less than 10k are non entities in terms of revenue.

At ANZ Stadium, we get a guaranteed income regardless of how many people show up. This is due to the fact that any game at ANZ helps them in terms of their ground signage, catering, corporate deals, etc. I asked Sid Kelly how much we made from each ANZ game and he said $150k. Over and above that, I understand that very large crowds and I believe the number may be 30,000 sees us making additional revenue over and above the guarantee sum.

However, it’s worth recognising that the games we are taking to ANZ are big games. Just as we generally sell out the Tigers matches, I’m sure we’d just about get 20k to any Parramatta vs Bulldogs match. As such, these would be matches that would be our profitable home matches. Not having these games at homes, also impacts our ability to sell signage and other sponsorship opportunities as well as corporate facilities. By taking these games away from Parramatta it is effectively making those corporate opportunities approximately 50 per cent less attractive.

It also makes membership packages less attractive. How many more memberships would we see if we were offering 12 home at Parramatta Stadium? As such, while the guaranteed income is attractive, the real bottom line income improvement I believe would be far less than the figures I’ve seen the club talk about, because other income is being sacrificed. Indeed, if we were a well-operated club, you would think a 50 per cent improvement in your ability to offer corporate sponsorship, signage and hospitality could even exceed the income offered to us by ANZ.

While we’re on that, let’s discuss the financials of taking a game to Mudgee, it’s been reported in the press that we’re getting a $150k package to sacrifice that game. The decision saw membership prices drop by $20 or so. If the club were to meet its membership goal of 20,000 and let’s assume that includes 15,000 ticketed then that means that the club made a decision to take a game from Parramatta that would actually cost the club money on its budget worksheets because that’s somewhere around a $300k sacrifice in membership revenues on that basis alone.

Now lets assume I didn’t misunderstand Kelly and the $150k is accurate. It sounds about right given that the NRL is supposedly offering the same amount of money, and I would assume the ANZ guarantee would be the benchmark it would be using when offering the incentive. And let’s assume that none of the points I’ve raised above are accurate. That we didn’t have big home games at Parramatta, that we couldn’t sell any more sponsorships or hospitality and that it didn’t impact memberships at all. If you take away all of those then the sum total difference is $800k (which is exactly the sum that the club quoted a the so-called ‘influential members’ forum.

The NRL has given us an extra $2 million next year. We keep getting told that the Leagues Club is so profitable (its not but that’s another story) yet the grant the NRL club received is the lowest it’s ever been. We’ve got very highly-paid executives in place, who are promising to double memberships which would result in million dollar plus improvements in revenue. One would think these executives would be able to significantly increase the corporate revenue that is opening to us with our digital outlets or get our morose corporate sponsorship back on track. And I’m not even going to go into all the wastage the club has spent on payouts to sacked coaches and executives, or the legal bills and so forth we’ve racked up over the past four years.

And this isn’t even factoring into the fact, that we are making this decision, knowing that we have a dreadful record of ANZ. We don’t just give up our home games and get forced to play at a neutral venue like a regional game, we actually give the opportunity for two key rivals the Bulldogs and Souths to play their games against us at THEIR home ground. Is it any wonder that we have had such a poor record at ANZ, when the two teams we’re playing at that ground are the two teams that play their every second week. How much are we risking in terms of points and our eventual position on the table with these decisions. And let’s assume we make the finals, what is going to be the psychological impact of not having won a game at ANZ for years going to have on the team.

Taking any games away from Parramatta is to my mind a lazy decision. I think I’ve demonstrated pretty clearly that the so-called revenue windfall is well overstated and indeed if we were doing a good job of selling corporate sponsorship and signage and getting fans into the ground there may not be any revenue advantage at all. If we were pulling in 40k people into ANZ then maybe its starts to make sense but the Dogs on a Thursday night is highly unlikely to attract that kind of crowd and our Souths games haven’t reached those numbers in the past. However I look at this, I can’t find a way to justify that the sacrifice is worth the reward.

P.S. I’m lucky enough to have pretty good access to a whole bunch of people to be able to ask the kinds of questions I have had to come up with these conclusions myself. This is the type of information that the club should be presenting to members. The forum to do that would be an NRL annual general meeting and report, that lays out these figures and makes the decision-making process transparent so that fans can have a true say in deciding what are very important and core decisions to the club. As it stands, none of this information is available to members. That’s just wrong.