Ok. so the Leagues club can operate at a profit, its the football club in dire straights.
$9m to run an NRL team
$4.5 salary cap
Where does the other $4.5m go ?
why can't they cut their budget by $2.5 million for a couple of years ?
http://www.news.com.au/heraldsun/sport/nrl/story/0,,23901838-14823,00.html
First up it takes ~ $16m to adequately run an NRL club, while 1 city clubs turn over $20m-$26m p.a. $9m will get you a pre-Russell Crowe South Sydney long term result.
You can't just slash $2.5m from the football department budget. Most clubs budget on $6m-$7m in player salaries, $4.5m on the 1st grade squad, and the rest on the non-NRL players in the QLD/NSW Cup, U20's and scholarships.
After that you have:
$1.5m on coaching staff (Although wealthy clubs spend over twice that)
$500k on medical costs
$100k on insurance,
$250k on travel that the NRL won't cover,
$$$$$ Venue Hire (or venue maintenance in the Sharks case)
$500k on match day costs (Cleaners, Security, Cheerleaders, Announcers)
$1.5m on Corporate Service (Catering, Functions, Facilities - Wealthy clubs often spend 3-4x as much)
$500k on advertising
$500k on training equipment
$200k on Clothing (Uniforms, Formal Wear, kits)
$200k on Consultants (Wrestling, Goal Kicking, Psychologists etc)
$1m in general running costs (Office costs, rent, bills, training ground maintenance)
$200k to out source ticketing
$1m on junior development
for a total of about $16m (clubs such as Brisbane/Gold Coast will spend an additional $5m-$10m)
The sharks biggest worry has to be there diabolical cash flow situation:
- The Cronulla Football club runs at a loss of ~ $1.4m p.a. (Even after the Leagues Club grant).
- Said Leagues Club grant has dropped from $2.4m (2008), to $1.5m this year, to just $250k in future years.
- The Football Club / Leagues Club no longer have the $9.7m federal grant sitting in the bank generating interest (Would revenue generated by the new stand cover this?)
- The Football Club / Leagues Club have the interest of an ever increasing bank loan to service.
So compared to the 2008 season budget, the Sharks Football department in 2010 are looking at :
$1.4m General loss + Additional Loss due to falling crowds + $2.15m Loss in Leagues Club Grant (Will now go to servicing debt) + $0.5m Loss in interest from spent federal grant + ~$1m loss due to loss of sponsors.
That puts the Football department about $5m in the red, plus whatever loss occurs due to low crowds.
The situation is basically beyond manage. The time for action was 3-4 years ago.