THE RICHEST GAME IN FOOTBALL

Championship Play-Off Final:
Brentford v Fulham
August 4, 2020

Finances Breakdown

[Thread]

Deloitte have projected revenues for both teams if they win promotion into the Premier League:

Brentford promoted - a potential £170m (over 3 years)

Fulham promoted - a potential £135m (over 3 years)

A £35m difference - important to bear in mind for this thread

Why "potential" revenues?

Using Brentford's "potential" £160m as an example:

[1] Broadcasting Revenue = ~£85m

[2] Parachute Payments = ~£75m spread over 2 years IF the club is relegated from the Premier League (in the first season)

[1] Broadcasting Revenue

This is fairly straight forward

Clubs get big money to have their games shown on TV

Breakdown in this thread: https://twitter.com/beardedfinance/status/1247216456766455808?s=19

[2.1] Parachute Payments

"Parachute payments" are why Fulham's potential earnings from promotion back into the Premier League is £35m less than Brentford's...

[2.2] Parachute Payments

What are they?

Club X receive money over 2 or 3 years AFTER they've been relegated:

2 yrs - teams that are relegated from the Prem in their first season after promotion

3 yrs - teams that were in the Prem for over 1 season before being relegated

[2.3] Parachute Payments

How much will relegated Club X get?

They receive a % of the broadcasting revenue paid to Premier League clubs

Year 1 = 55% = ~£40m
Year 2 = 45% = ~£35m
[Year 3 = 20% = ~£15m] - if they last more than 1 season in the Premier League

[2.4] Parachute Payments - a caveat

Parachute payments stop if a club is promoted back into the Premier League during their 2/3 year parachute payment period

This is where Fulham currently lie - (relegated in 2019)...

Remember our £35m difference?

Read on

Fulham have a parachute payment period of 2 years as they were relegated in their first season back in the Prem

They've already received Year 1's payments of £40m

But if they're promoted back into the Prem, they'd miss out on Year 2's payments of £35m

Hence, the £35m variance

Brentford would benefit much more from promotion as they do not currently receive parachute payments

Potential earnings are higher as they don't need to forgo any payments like Fulham

Parachute payments are a controversial topic

Norwich, relegated from the Prem this season, are set to receive their first parachute payment of £40m

Is this fair? Probably not

Norwich will be able to keep some of their better players and challenge for promotion again next szn