TET
Well-known member
Is there anything in what I see as the Moonbeam theory that the Killed Rangers stone dead?
Can that theory of building castles in the sky work?
Or do you need a grounded theory with ambition, tempered by the correct risk factors?
What are these correct risk factors? How do you attempt to quantify them?
Now, lets try and make some fundamental building blocks to see if a better understanding can be achieved. And we will attempt to put out some arbitrary but hopefully realistic and to a certain extent justified set of risk factors based on recent years income numbers. But a certain level of basic quantified numbers that can individually be analysed and discussed and amended if necessary, why, just to come up with some risk factors that should be considered every season, but still remain on the ambitious side of risk without loony tunes excessive gambling.
Some assumptions
these assumptions are basic and can be changed if argued as false
Assumption 1 Winning the treble generates 55m income
Assumption 2 Reaching the Europa League Group generates 25m income
Assumption 3 Winning Champions league Play off match and reach CL group generates a further 25m
Pretty simplistic assumptions but imo pretty decent rule of thumb for building basic risk model
Risk for assumption 1
What ordinary operation cost is correct? to win the 55m maximum ordinary income?
Lets say 10 percent profit is what your looking for from your risk. so 5 million profit is expected ordinary profit from winning treble.
That would mean ordinary operating costs should not exceed 50m which leaves 5m profit as growth for that season.
So operating costs include on simplistic level
Staff wages + other operating costs
lets stick an arbitrary figure of 10 percent of income as other operating costs and wages as 90 percent of operating costs.
that would mean to achieve the expected income we estimate
55m income
45m wages
5m other operating costs
5m profit.
Risk for assumption 2
First off what bonus level is correct for the Bhoys who achieved the title, and earned the right to compete in Europe?
Well we know that bonus needs to be competitive.
So lets say 50 percent increase in the wages if they achieve champions league and 25 percent increase if the achieve europa league group.
So instantly without adding any more players to team the 50 million operating costs has become 63.75 [(45x1.25) 56.25 + (5+2.5) 7.5] This includes wage bonus and rather arbitrary figure set at other operating income
so
if europa league group is achieved
80m income
56.25 wages
7.5 other operating costs.
16.25 m profit
Risk for assumption 3
So lets say 50 percent increase in the wages if they achieve champions league and 25 percent increase if the achieve europa league group.
So instantly without adding any more players to team the 50 million operating costs has become 77.5 [(45x1.5) 67.5 + (5+5) 10] This includes wage bonus and rather arbitrary figure set at other operating income.
if CL group is acheived
105m income
67.5 wages
10 other operating income
27.5 profit
Sounds really good yeah nice profit but thats based on ordinary wages of 45 million and income for treble being 55million
Also club was hoping for 5 million profit from treble alone
So so minus that from Champions league profit under these conditions
And that 50 million windfall from champions league has been reduced to 22.5 profit that can be used to enhance your club.
Still sounds pretty decent right?
But its long way from the MSM income figure quoted and assumed banked by too many.
22.5 million is still pretty decent
So lets tax risks to maximum and see what figures that means are available to build a team.
105 million income for champions league
lets say club only wants 5 million profit any given year
so 100 million is max figure for max ambition
lets say the other operating income figure for champions league is good rule thumb, so 10m
thats wages including champions league set at 90 million
if that 90 million is with 50 percent bonus for achieving champions league then ordinary wages without champions league would be 60 million
Add the ordinary costs not included and 65 million is your operating costs minimum under those extremely risky conditions.
Which would mean 10 million loss if you failed to reach champions league 2.5 million loss if you reached europa league group and 5 million profit if you reached the champions league group.
it would also be much worse than 10 million loss if treble not won
And I suspect in excess of 20million loss if league not won.
so ramping up ordinary wages to the very maximum risk would require treble and champions league in that season just to get 5 million profit.
Seems fool hardy to me.
And that extremely risky level is reached with ordinary wages before bonus set at 60 million for entire club for the year.
So somewhere between the two risk models seems correct but I would suggest never taking ordinary wages beyond 50 million before bonuses. but not below 45 million.
Now you may say this model is too simplistic, or you may decide I have missed out key figures.
I possibly have.
Im looking for the best risk model for the club.
Not crazy moonbeam models based on 60 million from champions league with no costs incurred.
Have you got a more suitable model?
do you have better figures than my arbitrary assumptions that imo seem bout right?
feel free to add your thoughts
even if its to say ya nutter
Absolute straw
moonbeams are better than your straw man garbage.
Or even better you think im reading all that shite, I want a team that can win the champions league and your realistic approach to football is depressing, Lennon is a backward step. AVB would have been better, even though him alone probably chews up most of the max max max operating wages of 60 million.
Can that theory of building castles in the sky work?
Or do you need a grounded theory with ambition, tempered by the correct risk factors?
What are these correct risk factors? How do you attempt to quantify them?
Now, lets try and make some fundamental building blocks to see if a better understanding can be achieved. And we will attempt to put out some arbitrary but hopefully realistic and to a certain extent justified set of risk factors based on recent years income numbers. But a certain level of basic quantified numbers that can individually be analysed and discussed and amended if necessary, why, just to come up with some risk factors that should be considered every season, but still remain on the ambitious side of risk without loony tunes excessive gambling.
Some assumptions
these assumptions are basic and can be changed if argued as false
Assumption 1 Winning the treble generates 55m income
Assumption 2 Reaching the Europa League Group generates 25m income
Assumption 3 Winning Champions league Play off match and reach CL group generates a further 25m
Pretty simplistic assumptions but imo pretty decent rule of thumb for building basic risk model
Risk for assumption 1
What ordinary operation cost is correct? to win the 55m maximum ordinary income?
Lets say 10 percent profit is what your looking for from your risk. so 5 million profit is expected ordinary profit from winning treble.
That would mean ordinary operating costs should not exceed 50m which leaves 5m profit as growth for that season.
So operating costs include on simplistic level
Staff wages + other operating costs
lets stick an arbitrary figure of 10 percent of income as other operating costs and wages as 90 percent of operating costs.
that would mean to achieve the expected income we estimate
55m income
45m wages
5m other operating costs
5m profit.
Risk for assumption 2
First off what bonus level is correct for the Bhoys who achieved the title, and earned the right to compete in Europe?
Well we know that bonus needs to be competitive.
So lets say 50 percent increase in the wages if they achieve champions league and 25 percent increase if the achieve europa league group.
So instantly without adding any more players to team the 50 million operating costs has become 63.75 [(45x1.25) 56.25 + (5+2.5) 7.5] This includes wage bonus and rather arbitrary figure set at other operating income
so
if europa league group is achieved
80m income
56.25 wages
7.5 other operating costs.
16.25 m profit
Risk for assumption 3
So lets say 50 percent increase in the wages if they achieve champions league and 25 percent increase if the achieve europa league group.
So instantly without adding any more players to team the 50 million operating costs has become 77.5 [(45x1.5) 67.5 + (5+5) 10] This includes wage bonus and rather arbitrary figure set at other operating income.
if CL group is acheived
105m income
67.5 wages
10 other operating income
27.5 profit
Sounds really good yeah nice profit but thats based on ordinary wages of 45 million and income for treble being 55million
Also club was hoping for 5 million profit from treble alone
So so minus that from Champions league profit under these conditions
And that 50 million windfall from champions league has been reduced to 22.5 profit that can be used to enhance your club.
Still sounds pretty decent right?
But its long way from the MSM income figure quoted and assumed banked by too many.
22.5 million is still pretty decent
So lets tax risks to maximum and see what figures that means are available to build a team.
105 million income for champions league
lets say club only wants 5 million profit any given year
so 100 million is max figure for max ambition
lets say the other operating income figure for champions league is good rule thumb, so 10m
thats wages including champions league set at 90 million
if that 90 million is with 50 percent bonus for achieving champions league then ordinary wages without champions league would be 60 million
Add the ordinary costs not included and 65 million is your operating costs minimum under those extremely risky conditions.
Which would mean 10 million loss if you failed to reach champions league 2.5 million loss if you reached europa league group and 5 million profit if you reached the champions league group.
it would also be much worse than 10 million loss if treble not won
And I suspect in excess of 20million loss if league not won.
so ramping up ordinary wages to the very maximum risk would require treble and champions league in that season just to get 5 million profit.
Seems fool hardy to me.
And that extremely risky level is reached with ordinary wages before bonus set at 60 million for entire club for the year.
So somewhere between the two risk models seems correct but I would suggest never taking ordinary wages beyond 50 million before bonuses. but not below 45 million.
Now you may say this model is too simplistic, or you may decide I have missed out key figures.
I possibly have.
Im looking for the best risk model for the club.
Not crazy moonbeam models based on 60 million from champions league with no costs incurred.
Have you got a more suitable model?
do you have better figures than my arbitrary assumptions that imo seem bout right?
feel free to add your thoughts
even if its to say ya nutter
Absolute straw
moonbeams are better than your straw man garbage.
Or even better you think im reading all that shite, I want a team that can win the champions league and your realistic approach to football is depressing, Lennon is a backward step. AVB would have been better, even though him alone probably chews up most of the max max max operating wages of 60 million.