With a third consecutive title and promotion in their sights, things could not be going better for Chester FC on the field. But off it, the picture is not as rosy, with the fan-owned club set to announce a loss of up to £75,000 for this season. PAUL WHEELOCK speaks to newly appointed Blues chairman Tony Durkin about the club’s current position – and where it goes from here.
YOU have been chairman and the new board has been in place for 60 days. What have you found?
It has been a whirlwind 60 days. Some of the issues we have found have been challenging to say the least.
What we quickly realised is our year-end forecast is not on track and we needed to address certain areas very quickly.
What are some of the areas you addressed?
Well, we got Neil Young on board to help him reduce costs on the playing budget as that was an area where we believed that we could make immediate savings.
We talked to Neil and he was very, very helpful. We constructed a budget, set a target, and Neil released Clancy, Booth, Mackin and Denson, which has helped us with cash flow and profitability.
When Craig Curran’s loan came up for renewal Neil knew we wouldn’t be able to keep him on. Neil was very understanding about it. Fortunately we were able to get sponsorship for the player’s wages and we kept Craig for another month.
That loan period has now come to an end and it won’t be extended. So we’ve made inroads on the playing budget without harming our promotion push.
What else have you been reviewing?
We’re reviewing all the commercial contracts that we’ve got, looking at their viability and looking at their exposure to the club. We’re going to try and mitigate any risks we’ve got with them by renegotiating or changing the terms.
We’re also looking at in-house viability and processes because at the moment the management controls aren’t robust enough. Management controls in any business are vitally important as they allow you to make informed decisions at any time.
If you produce monthly management accounts, they may not be 100% accurate, but they certainly should be 90-95% correct. Having those figures – which are fluid and will change – allows you to manage the business more carefully.
The club needed to do that and it has started doing that. We’ve now got Laurence Kirby on board as our volunteer financial controller and he is heading up an accountancy team. He has worked very hard over the last 60 days to produce a set of management accounts to the end of December and a forecast to the end of the financial year and beyond.
Now we’re in a position where we can manage ourselves for the last four months of this financial year – February, March, April and May – before the year-end audit is carried out at the end of May.
With the team on the verge of another promotion, this time to the Conference, what are the club’s objectives?
We’ve got to look at our revenue streams and we’ve got to be sustainable. That’s our main headline aim for this club. We need to run the club as a business – end of story.
I’m not saying it needs to make massive profits every year because it doesn’t have to. We can invest for a future return. But unfortunately the position we’re in at the moment is we’re not as healthy as we thought we were.
We’re going to need to consolidate over a period of time and I can’t identify what period of time that is yet.
If we get into the Conference we shouldn’t be under any illusions that we’ll be going for another promotion because I don’t believe we’ll be able to provide the playing budget to enable us to do that.
So we all need to be realistic about the future and we may need to spend two or three – or maybe more – years in the Conference while we consolidate our club, get some reserves into the bank, and then maybe look at a push for the Football League.
What is the actual loss the club stands to make for the financial year?
It’s a figure that stands between £65,000 and £75,000. We’re not 100% sure but we know we’re going to be around that figure. We have eaten into the cash reserves and by the end of the playing season most of the reserves will be used up.
What is being done to reduce the loss and are you confident you can do it?
I’m confident we can pull this round and address the issues that have come about as I can see already the reasons why we’re in this position. It’s not just one thing – it’s a combination of different things.
There is an element of uninformed decision making but I know that we can quickly address that.
To do that we’ve got to get governance in place and on a positive note we’ve applied for grant aid from Supporters Direct and we’ve been successful in that.
We’ve got four days with them in early February when Supporters Direct will come and work with us, look at the business as a whole, and assist us with building processes in control and management.
We’ve got a volunteer who’s very skilled in this area, called Richard Lynes, who’s going to head that up for us along with the board.
Supporters Direct and the club will produce a report and from that report we’ll produce an action plan that we’ll act upon during the close season.
What ideas does the club have regarding fundraising? In particular, fundraising within the fan base.
We’ve set up a fundraising committee which is being headed up by a volunteer who’s known around the club, Brian Burns.
He is a very driven person who has risen to the challenge we’ve put to him. He’s got a committee, to which he’s recruiting members, and he’s got some ideas which he will take to the wider fan base in the coming weeks and months.
Some are purely fundraising – the likes of sponsored walks – but we need some prime fundraisers, big-number fundraisers. And one of the areas we are concentrating on is City Fans United membership. It’s a members-owned club and those members really have got to support the club financially.
It’s difficult times, we know times are hard for everybody and some people can afford to pay more than others, but we’ve got to have a membership figure that is realistic for a members-owned club.
At the moment our thoughts are that £5 a year is not realistic and we are looking at that as a main revenue stream moving forward.
For some supporters reading this, it may come as a bit of a shock. Have you got a final message for Chester fans?
The message I’ve had throughout my life – in sickness and in health – is be positive. That’s what we’ll be. There’s no point looking back. What’s done is done. What we’ve got to do is undo it and make our club a better place and a better business.
I want to reassure supporters I can do it with the board I’ve got behind me and with the volunteers I’ve got behind me.
I can do it come hell or high water. I’m going to try my very best to turn this club around and I’m confident I can.
Please join me in being positive and let’s get Chester FC back on track again.