“They’ll be very competitive”: Finance expert about what promotion could mean for Town

Football finance specialist Kieran Maguire feels that Ipswich Town’s possible promotion to the Premier League would offer a significant financial boost to both the club and the local economy.

The Blues are presently one point away from promotion to the Premier League, having last competed in the top tier in the 2001/2002 season.

Of course, football has changed dramatically since then, with top-level finances hitting new heights year after year. As a result, if Town avoid loss against Huddersfield Town on Saturday afternoon, Maguire predicts that it would help all elements of the local community.

“If we look at Ipswich Town’s accounts last year, they generated £21 million in revenue,” he told BBC Radio Suffolk. “That’s likely to be around £30 million this year, given the improved TV deal you get in the Championship.”

“When you compare them to the Premier League’s worst team, Southampton last season, they generated little under £140 million. We’re talking about a four to four and a half times increase in income.

“You then get all of the ancillary benefits in terms of tourism, including vox pops from TV stations all over the world.

“Brighton conducted an economic impact assessment last season, which revealed that being in the Premier League provided £600 million in benefits to the town or city’s overall economy.

“The Premier League is exported to 197 nations throughout the world. The TV deals are incredible, and the degree of dedication from abroad supporters who are just as eager to see Premier League games as we are at home is enormous.

“As a result, hosting the world champions Manchester City or a club of the caliber of Liverpool, Chelsea, or Arsenal attracts additional attention.

“Local chambers of commerce, hospitality, and industry, because there will be international fans visiting Ipswich who would not have come otherwise. All of this can significantly enhance the local economy.

In terms of the squad, Ipswich must get it right if they are to confirm promotion on Saturday. Some clubs have made few to no changes since entering the Premier League, and as a result, they have suffered, while others have paid the price for overspending in order to establish themselves at the highest level. The latter can result in point deductions and other major penalties.

Town will want to be someplace in the middle. Brighton and Brentford are both excellent examples of how to do this, and Maguire understands that the Blues will need to pursue a similar path.

“I think it’s absolutely essential,” he said. “Historically, we’ve seen a few clubs go up, spend a fortune, fail, and then crash and burn their way back to the Championship.

“All of a sudden, you had players with contracts of £40,000 or £50,000 per week. Yes, they’ve probably reduced relegation clauses little, but you’re still paying Premier League wages in the Championship. This has the potential to significantly impact the club’s finances.

“Making the proper decisions is vitally necessary. You must have a long-term strategy, and the nature of sport dictates that 10 days is an extremely lengthy time since you have three prospective matchups. Three victories or three defeats can have a significant impact on promotion and relegation.

“Having a board who are in line in thinking with the manager as to the strategy of the club to, first of all, establish yourself in the Premier League and then push on from there, is absolutely critical.”

On the other hand, Ipswich’s financial strength would be considerable, if not in the Premier League, then in the broader context of global football.

In recent months, we’ve seen mid-table clubs outbid some of Europe’s giants for certain recruits because they have the financial resources. CEO Mark Ashton will understand that the club must be ambitious, and Maguire believes this will be realized in the coming weeks.

“I think they’ll be able to be very competitive because of the success of the Premier League,” he said.

“A club that has been promoted is able to pay a level of wage and commit to the transfer market, which effectively outpaces every other club in Europe with the exception of what you might refer to as the’senior teams’, which are clubs that regularly appear in the Champions League and the Europa League, among other things.

“Ipswich Town will have a higher budget than every team in Belgium, and probably every team in the Netherlands, with the exception of Ajax.

“It implies that you can attract good athletes. Of course, if they prove themselves in the Premier League, you must realize that there will always be envious eyes looking, whether it’s Kieran McKenna, someone you buy, or someone who comes through your junior system.

“That is part of the wider issue of the Premier League, which is actually divided into two or three divisions.

“You have the major six, maybe the big seven, with Newcastle. There’s then an established middle class, as well as six or seven teams at the bottom vying for a spot in it. “They all have slightly different budgets.”