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Professionalisation of African football (part 2): Clubs facing the challenge of financial dependence – is stadium ownership the solution?

There is a financial dependence of African professional clubs on owners or on subsidies. This situation which weakens them questions about their sustainability? Faced with this challenge, the experiences of different clubs across the continent show the place that the stadium should occupy in a club’s development strategy.

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According to the Jeuneafrique newspaper, more than half of TP Mazembe’s income still comes from its president, Moïse Katumbi. However, his strategy to remedy this dependence makes the club a model in Africa. His commitment is to “maximize the club’s own revenues” by acquiring the production tool of modern football clubs, namely the stadium.
This puts the club in the ideal position to conquer new and more sustainable sources of income such as ticketing and commercial income (sponsorship and merchandising).
Today with its own modern stadium of 18,500 seats, TPM has the biggest private stadium in Africa which generates up to $ 70,000 ticketing revenue in Champions League big games, and attracts more than 6 sponsors (source: Jeuneafrique). The success of the project convinced the president to launch the project of a larger stadium with 50,000 seats.

Tp Mazembe stadium

The stadium is in fact described as “The production tool” for modern football clubs because it’s the source of most of the club’s income at maturity. These are more sustainable because they are independent of an individual. However, to fully enjoy these revenues, having your own stadium is a proven advantage. It is indeed shown that the 5 richest clubs in the world all have their own stadium and also generate the highest ticketing income, namely:

  • Manchester United (137.5; 44% of the total budget),
  • Arsenal (134, 6; 51% of the total budget),
  • Chelsea (110.7; 39% of the total budget),
  • FC Barcelona (88.6; 31% of the total budget),
  • Real Madrid (82.2; 23% of the total budget).

Screenshot of Éric Besson’s report entitled “increasing the competitiveness of French professional football clubs” published in 2008

But the stadium does not only offer income from ticketing. It’s the lesson that we learn from the correlation observed between ticketing and commercial income (merchandising and sponsorship), since the same 7 clubs generate more income from these two poles.

Comparative ranking of the clubs with the highest revenue in ticket sales and commercial income. Screenshot of Éric Besson’s report entitled “increasing the competitiveness of French professional football clubs” published in 2008.

In fact, the stadium is not only a source of direct profit but equally a powerful marketing tool. To better understand the stadium’s potential beyond ticketing, let’s start from the observation that the stadium is an element of the club’s identity. It help to distinguishe a club from the others. It very quickly merges with the club to the point that it becomes impossible to dissociate them. The stadium offers the club the opportunity to attract fans and above all to create a unique relationship with them, thus fosters their loyalty and offers the opportunity to other companies to associate their brand with the image of the club, sponsorship and merchandising find all their justification. If the club wants to be able to build this particular relationship with its fans, it is important to keep control over its stadium “Thus, mastering their production tool, the clubs set up strong marketing policies, target the clientele, adapt the stadiums for a better hosting, attract sponsors, improving on their image”.

Such a mastery is ideally done by having its own stadium, is precisely what TP Mazembe did.

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Non-ownership of the stadium… a handicap!

The non-ownership of the stadium increases the risk for the club of not mastering its production tool and of not being able to adapt it to the standards of the competitions in which it participates or wishes to participate, to its strategic and marketing choices, thus increasing the difficulties [ …] To increase commercial income “,

affirmed Eric Besson in his report entitled “increasing the competitiveness of French professional football clubs” published in 2008. This report demonstrates how the option of renting stadiums has resulted in slower development of French clubs in Europe and increased fragility. In terms of budget, the French championship is 5th behind England, Germany, Spain and Italy (the gap with Italy is just of 20%), with the lowest commercial incomes, and dependence on TV rights which represent 57% of revenues.

The same stadium rental system shows its limits in South Africa, where it deprives clubs of their freedom by exposing them to competition from other clubs or other events. Orlando Pirates is suffering from this situation, as the club has often been deprived of his stadium by the concessionaire Stadium Management South Africa, in favour of other events such as concerts.

PSL - Kaizer Chiefs v Orlando Pirates | Sport24

Orlando pirates fans

The club is often forced to relocate its home games. A very uncomfortable situation for the supporters. Umar Farouk Mathir, famous supporter of Orlando Pirates told us:

“Clubs don’t realize how much they are losing in the long run. Supporters hate stadium changes. This can sometimes discourage them. ”

The case of Asec Mimosas in Côte d’Ivoire deserves special attention. Its investments focus mainly on its training centre and other activities not related to football, such as the acquisition of a hotel complex. Modelled on the Amsterdam Ajax model, it is above all intended to be an academy that trains footballers to resell them in the biggest clubs.

Ligue des Champions Afrique : l'ASEC Mimosas revient de très loin !

Asec Mimosas FC

So the club lives mainly from the sale of trained players (50% of the budget), ancillary activities and subsidies (29%). The production of the professional club itself is reduced to 20% sponsorship, 1% ticketing (according to statistics from Le monde). By concentrating its investments on annexe activities, Asec is taking the opposite path from TP Mazembe by creating dependence on an external source of income. We must therefore fear that the professional team will become a financial abyss which would become economically absurd to maintain. The current situation does not, however, seem ideal for increasing the team’s own production, since Côte d’Ivoire certainly offers the worst solution in terms of stadium policy. Stadiums generally belong to the state that makes them available to the league. Thus, when a stadium is built in a city, all clubs in that city and in the surrounding cities where there is no stadium have the right to schedule their games to this stadium. This sharing of the same stadium with other clubs is not conducive to maintaining a conducive playground to the practice of their style of play. This is particularly harmful to Asec which wants to be an academy and claims the identity of a club that produces a beautiful game. This is the argument that allows them to build and maintain their fan base.

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The disaster of the mythical clubs of Cameroon allows us to better understand the dangers of this system. Union de Douala, for example, was initially forced to share the Reunification stadium with sometimes up to 8 other clubs, as was the case in the 2016/2017 season. The first consequences are unfavourable scheduling such as playing on a Sunday at 1 p.m. under a temperature of 40 ° C or Monday at 3 p.m., which is not likely to encourage fans to come and support their team.

In addition, overuse has led to a rapid deterioration of the playing area, thereby lowering the quality of the show. Worst, for the past 2 seasons, the Reunification stadium has been unavailable due to work for the preparation of Chan 2020 and Can 2021.

The Douala reunification table – Ready to host CHAN and AFCON games

Union has been relocated to the neighbouring city of Limbe where it is wandered from stadium to stadium , depending on availability. A generalized situation which made Oumarou Sokba, then coach of Apejes de Mfou FC, say,

“The law of domicile no longer exists in the Cameroonian championship”.

This situation is certainly not unrelated to the spectacular decline of Union of Douala, since abandoned by its fans who can no longer follow it in its changes of domicile, the club has almost lost its ticketing and commercial revenues. She is almost dead financially and even athletically.

Elite One: Union de Douala enchaîne – Lion Indomptable

Union FC of Douala

Now unable to provide salaries of around 150,000 CFA francs / month (around $ 255), the club has accumulated overdue payments for years (according to fifpro and synafoc), the club has disappeared from the international scene and only exists in a dying local championship with competitors practically all in the same survival situation.

Version française originale

André Marie Awoumou Manga, business lawyer, sports columnist

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Africa

African Nations gear up as International Football resumes in October.

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CAF member states prepare for the resumption of international football in the continent next month.

Football in the continent,  has been halted for over six months due to the effects of the deadly COVID-19 pandemic outbreak in March this year.

With many borders through out the continent still closed due to the COVID-19 pandemic,   teams in the continent are heading to Europe for next month’s international matches.

Cameroon are traveling to the Netherlands,  Guinea to Portugal, while the Ivory coast,  Nigeria and Tunisia head to Austria,  where it is easier for them to assembly their squads because most of their players are Europe based players.

Cameroon’s Indomitable lions

It should be noted that, the next FIFA window for international football,  from October 5-13, is the first opportunity for African national teams to play since last November.

FIFA however,  had cancelled the September window for all confiderations but for UEFA  due to the uncertainty over travels around the continent caused CAF to back the resumption of international football in November.

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Next month’s window will see most CAF Member States to play series of friendly matches  in preparation for both the AFCON and world cup qualifiers.

Nigeria have arranged friendlies against the Ivory coast and Tunisia on October 9 and October 13 in Austria,  while five time champions of Africa,  Cameroon will have a friendly against Japan in Utrecht,  after which they will stay in a training camp in the Netherlands for a few more days.

Indomitable Lions coach Antonio Conceicao, this week published a preliminary list of 32 players for the match and camping.

Guinea on their part, will play cape Verde islands on October 10 while the DR Congo travel to Morocco for a training camp and a behind-closed doors international match against their host in Rabat on October 13.

Senegal are also to play Morocco in Rabat on October 9 while the current African champions Algeria are yet to announce their plans but reports say they will also go to Austria.

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Down to the southern hemisphere,  south Africa are trying to organize two friendly matches at home next month against neighboring countries but have yet to finalize arrangements as they await for a possible reopening of their borders in the coming weeks.

 

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Africa

CAF President, Ahmad congratulates Ghana’ s President Nana Akufo Addo on his appointment as Chairman of ECOWAS.

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The Confederation of African Football (CAF) boss Ahmad has extended his words of congratulations to the Ghana president,  H. E. Nana Addo-Dankwa Akufo Addo, on his new appointment as the new chairman of the Economic Community of West African States (ECOWAS).

President Ahmad’s words were more diplomatic, as this was contained in a letter addressed to the Ghana president on September 14, 2020.

H. E Nana Addo-Dankwa Akufo.

“It is my pleasure to extend my congratulations to you on your appointment as the chairman of the Economic Community of West African States (ECOWAS). On behalf of the Executive committee of CAF and personally,  I wish you every success in your endeavors. I am certain that during your chairmanship, ECOWAS will maintain and accelerate its constructive and sympathetic contribution to African Football.  As you embark upon your new responsibilities, I wish to assure you and the people of West Africa of CAF’s continued support and friendship.  I am certain that during your presidency,  ECOWAS will maintain and accelerate its constructive contribution to African Football.  Kindly accept, Mr. President, once again my warm congratulations on your appointment and my best wishes as you prepare to take up thr responsibilities,  and challenges of your new office” the letter read.

President Nana Akufo Addo was elected as the new chairman of ECOWAS on September 8, 2020 at the 57 th summit of the regional bloc held in Niamey, Niger.

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He replaces Nigerian born Muhamadou Issoufour who held the position for one year.

Source: sportsworldghana.com

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Cameroon

CAMEROON Indomitable Lions: The list of 32 players preselected by Antonio Conceiçao Olivera

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Cameroon’s indomitable lion’s gaffer Antonio Conceiçao Olivera, has released through Facebook a list of 32 preselected players for two International friendlies that will take place during the October 2020 FIFA window.

The indomitable lions have 2 big challenges ahead as they face Africa’s reigning champions Algeria and Asian dragons Japan in what will be the first Post COVID-19 matches.

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