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Europa league and SCR

GBSAFC

GBSAFC

Striker
Anybody concerned about this restriction



SCR is the new financial sustainability rule introduced by UEFA (and recently adopted by the Premier League to replace the old PSR/FFP rules).

Instead of looking at raw profit and loss, SCR limits how much a club can spend on its squad based on a strict percentage of its total revenue.

The SCR Formula:
Squad Cost Ratio} = {Player Wages} + {Manager Wages} + {Transfer Fees (Amortised)} + {Agent Fees}}{{Total Club Revenue}}


Essentially, the more money a club brings in through ticket sales, TV rights, and sponsorships, the more it is allowed to spend on its squad.
How Do They Connect?

The connection is all about the spending limits imposed on clubs that qualify for European competitions like the Europa League.

The Europa League Rule (UEFA): If a team qualifies for the Europa League, UEFA enforces a strict 70% SCR limit. This means the club cannot spend more than 70% of its total revenue on player wages and transfers.

The Domestic Leeway: In contrast, the Premier League allows clubs not playing in Europe to spend up to 85% of their revenue on their squads.
Why this matters
If a mid-table team suddenly punches above its weight and qualifies for the Europa League, it faces a bit of a financial squeeze.

They have to instantly drop their squad spending from the domestic 85% limit down to UEFA's 70% limit to comply with the rules of the tournament.

UEFA designed this strict 70% cap to prevent clubs from overspending, piling on debt
 
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Seems fair to me
Is the revenue based on upcoming year ( ie for us our first year in Euro ) or on preceding ie first year back in premier
Chances are with the extra games, and other revenue stream from euro participation our money will be largely increased
Happy to be enlightened
 
I dont think we will be at or near the 70% limit currently.

I dont know if its based on the previous seasons income or the season of the European campaign but assuming our turnover next season will be about 220-230 million we should be alright.

It looks bad becuase we get about 220m this season but spent 160m on players but when most of that is spread over 5 years its nowt really.
 
Its clear we short in key areas
But our recruitment has been incredible
Squad size and increased game played demands are a problem i think were capable of solving

A question im.asking if we don't progress beyond the initial 8 game phase does tuat mean in january the SCR constraints are removed
 
I don’t know the answer to that but I’m assuming it applies to the whole season and not just a proportion of it.
Overall, our benefit is that we got promoted without spending heavily and then qualifies for Europe after only one season. This means we are not currently weighted down by extreme levels of player amortization or wages. Add to that higher income vs what I would expect was budgeted. I don’t think SCR will pose much of a problem next season and we still have room to spend at a similar level to last season but we don’t need as many new players.
 
Local Lad said:
I dont think we will be at or near the 70% limit currently.

I dont know if its based on the previous seasons income or the season of the European campaign but assuming our turnover next season will be about 220-230 million we should be alright.

It looks bad becuase we get about 220m this season but spent 160m on players but when most of that is spread over 5 years its nowt really.
Click to expand...
Its based on next seasons revenue. The 15% difference in allowed spending from 85% to 70% will be somewhat offset by increased matchday revenue, prize money and higher sponsorships.
 
A half decent Europa campaign will likely see us bring in an extra £40-50m so that will probably mean our available spend is about the same as it would have been had we not qualified for Europe.

But that’s for the bean counters. Wouldn’t swap this for all the tea in China
 
Depending on how we do this season coming there’s surely an arguement for serious talk about extensions to the stadium to increase revenue
 
GBSAFC said:
Anybody concerned about this restriction



SCR is the new financial sustainability rule introduced by UEFA (and recently adopted by the Premier League to replace the old PSR/FFP rules).

Instead of looking at raw profit and loss, SCR limits how much a club can spend on its squad based on a strict percentage of its total revenue.

The SCR Formula:
Squad Cost Ratio} = {Player Wages} + {Manager Wages} + {Transfer Fees (Amortised)} + {Agent Fees}}{{Total Club Revenue}}


Essentially, the more money a club brings in through ticket sales, TV rights, and sponsorships, the more it is allowed to spend on its squad.
How Do They Connect?

The connection is all about the spending limits imposed on clubs that qualify for European competitions like the Europa League.

The Europa League Rule (UEFA): If a team qualifies for the Europa League, UEFA enforces a strict 70% SCR limit. This means the club cannot spend more than 70% of its total revenue on player wages and transfers.

The Domestic Leeway: In contrast, the Premier League allows clubs not playing in Europe to spend up to 85% of their revenue on their squads.
Why this matters
If a mid-table team suddenly punches above its weight and qualifies for the Europa League, it faces a bit of a financial squeeze.

They have to instantly drop their squad spending from the domestic 85% limit down to UEFA's 70% limit to comply with the rules of the tournament.

UEFA designed this strict 70% cap to prevent clubs from overspending, piling on debt
Click to expand...

Great rule and one I fully support.

People are quick to forget we nearly lost our club five years ago.

My only gripe is that UEFA should enforce the same rule across all leagues under their remit. It’s stupid that different leagues have different domestic rules.
Any domestic league that doesn’t comply shouldn’t be allowed entry into the UEFA competitions. That would quickly get everyone on board.
 
So we got £168.2 million for staying up…. So that’s prize money and tv deal money.

Looking at last season the club brought in £28.3 million (gate receipts/merch/commercial - not counting prize money or champ tv deal share). Let’s assume a 10% growth in this revenue, minimum. So £31 million….

Giving us roughly £200 million revenue to play with. 70% of which is £140 million. So £140 million to spend (excluding player sales). Working off an existing amortisation of transfer spend of 44 million (based on last seasons transfer spend spread over an average of a 4 year contract) the club would be afforded around £100 million to spend still! That’s an insane amount when you consider how transfers are accounted through amortisation.

I’m no accountant, but I really don’t think we have much to fear given the revenue the club has now got and also the means by which transfer fees are accounted for over the length of player contracts. Especially with our tendency to buy predominantly young players on long term contracts!

Biggest concern for me is the rules on home grown players which may mean we have to pay more for less (so to speak) or to field a smaller/or more inexperienced (young) team.
 
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