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For the love of the game: Bristol Sport's CFO on winning games, achieving sustainability and the emotion of sport

3rd Oct 2018
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It's still some way from the bright lights and dazzling revenues of the Premier League, but Bristol Sport has big ambitions. AccountingWEB chatted to Gavin Marshall, the group CFO, to find out more. 

“We lose a lot of money.” That’s probably not what you’d expect to hear a CFO say, but Gavin Marshall isn’t the financial head of an ordinary business. He’s the group CFO of Bristol Sport.

That’s the umbrella entity of Bristol City FC and the newly renamed Bristol Bears rugby team. Alongside these two clubs are Bristol Flyers, a basketball team, and the women’s rugby and football clubs.

For Marshall - who trained with Deloitte and worked at traditional businesses like Intel - it’s the finances that’s the strangest aspect of professional sport.

“Success can mean losing more money. Our football club had its most successful year in a decade: best league position, highest attendance, record season ticket sales - but we lost the most money we've ever lost."

Last January, Bristol City found itself ensconced in second place in the Championship. Promotion was on the table and, as Marshall points out, “you get a £170m windfall if you make it into the Premier League”.

So the club spent big during the January transfer window. “We thought if we can hang onto our stars and add a few key players, we can get promoted. The lure of the Premiership influences a lot of overspending in our league.”

Eventually, the club slumped to an 11th-place finish as players tired following a run to the League Cup semi-final.

“If we knew we were going to end up 11th, then we would've acted in a certain way. But we were second, and we needed to go for it,” said Marshall.

“That’s football and that’s sport. The results are unpredictable, player development is unpredictable, and because of the transfer fees, that can make an enormous difference to the finances. There’s a lot of emotion in football - you go on a losing run, the fans have a protest.

“What I find hard is, as a finance person, I want to stick to a strategy or a plan and it's hard to get people to stick to that plan and take the emotion out. ”

Long-term planning is a luxury that Marshall doesn’t have. And even unexpected windfalls can evaporate in the blink of an eye. After Bristol City’s cup run - which included a famous victory against Manchester United - the club smashed its budget.

“When we drew Man United in the cup, we came up with something quite neat: if you wanted to get a ticket for the game, you had to be a member. Membership is the next level down from being a season ticket holder. We basically told people they couldn't get a ticket if they weren't members. As a result, we had a massive spike in members and half-season tickets."

Bristol City generally sells about a 100 half-season tickets but sold over 2,500 last year. And a number of them converted into full season ticket holders this season. “Part of it is what you can control and making hay while the sun shines," said Marshall. "Get people committed and get them through the gates. Part of the business is being an opportunist.”

Player transfers

Despite last season's revenue boost, even at Championship level player acquisitions are notoriously costly and a couple of bad signings can burn through all but the biggest of war chests.

“It's difficult, especially in football where things are so expensive," said Marshall. "Players are highly paid at our level - and that's before loan fees and transfer fees. You can work so hard to get the pennies and then with one decision, you can blow it.”

Player value is an especially tricky part of Marshall’s remit. Transfers are an admin-heavy procedure. When a player is sold, it’s not usually done in one chunk. The fee is often split over a few seasons and will come with clauses. If the player gets picked for England, for example, or plays x amount of games, then the club unlocks another chunk of cash.

The reverse is also true for City, and Marshall has to keep track of these complex deals. "When a player is sold but flops or is seriously injured, the club doesn’t get the full value from the sale. It becomes tricky to forecast for future years because you have a number of future obligations and future receivables.”

Marshall relies, unsurprisingly, on Excel for his forecasting. “It’s just so fluid and it’s easy for non-financial team members to read it,” he said. Only Excel is flexible enough to cope with the “constantly shifting feed of good and bad news”.

Bristol Sport’s position is fortunate, however. The clubs are supported by Stephen Lansdown, of Hargreaves Lansdown, himself an accountant and a man of considerable means. Lansdown’s patronage has been an enormous boon for sport in Bristol. It could be argued that this takes the pressure off Marshall but according to him, that's not the case.

Lansdown isn’t a sugar daddy, Marshall explained. “From Steve's perspective, he's invested a lot of money in Bristol's sporting teams, but he's been very clear he wants the clubs to be sustainable and self-sufficient. He's prepared to invest and leave a legacy, but the aim is to have the clubs stand on their own two feet.

“There's a massive focus here on sustainability. That's behind a lot of our capital projects. From my perspective, it's not the case but it's tempting to think 'if we overspend on the budget, we're not going to go bankrupt'. But we're moving to a model where we agree on budgets with Steve at the start of the year and we have to stick to it.”

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