Income streams from the Ricoh (3 Viewers)

[shy_tall_knight]

Struggling to comment on the takeover threads like a lot I'll wait until confirmed / signed however debating with other fans why being tenants at the Ricoh under the current arrangements we have no long-term future. Under our current arrangement do we:
get any % of the stadium sponsorship (Ricoh deal signed back in 2005)
any income from the advertising hoardings or is that all for WASPS
car parking what does the club get what do WASPS keep
food and beverages - is £72k the full amount for the year CCFC received for 2015/16
corporate hospitality - don't WASPS charge a quite a high rate per person and the excess is what the club gets to keep, corporate hospitality income is very low is that correct ?

Also does anybody know what the value of matchday costs are, and what costs do they cover

 

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[stupot07]

From what I understand we don't get any (and never have) of the stadium sponsorship and in terms of advertising hoarding we only get pitchside as they are temporary and removed for wasps matches.

IIRC we get a cut of the parking but parking plus f&b share was only about £74k combined. No idea what % wasps get, they have commissioned off parking to acpoa (sp?), I imagine they have paid wasps a flat fee up front.

When acl were renegotiating before sixfields they wanted to put up matchday costs to £12k per game.

And from whats been posted in here wasps charge commercial rate for corporate and we have to pay for the whole suite, regardless of whether we fill them or not

You've also got to factor in the next deal will be considerably more than the £100k pa rent we pay now.

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[Brylowes]

Struggling to comment on the takeover threads like a lot I'll wait until confirmed / signed however debating with other fans why being tenants at the Ricoh under the current arrangements we have no long-term future. Under our current arrangement do we:
get any % of the stadium sponsorship (Ricoh deal signed back in 2005)
any income from the advertising hoardings or is that all for WASPS
car parking what does the club get what do WASPS keep
food and beverages - is £72k the full amount for the year CCFC received for 2015/16
corporate hospitality - don't WASPS charge a quite a high rate per person and the excess is what the club gets to keep, corporate hospitality income is very low is that correct ?

Also does anybody know what the value of matchday costs are, and what costs do they cover

With regards the F&B I think the more customers we can attract to the stadium, the more F&B
people will consume, the more money we will make.
At the moment 'it would seem" we can't sell enough to make it worthwhile switching on the oven.

 

[stupot07]

With regards the F&B I think the more customers we can attract to the stadium, the more F&B
people will consume, the more money we will make.
At the moment 'it would seem" we can't sell enough to make it worthwhile switching on the oven.

Its also wrapped up in the compass contract, so the profit margin isn't that good. I remember from the ACL Q&A on the trust website , the profit margin was only about 11%, and we only get a portion of that. Given that we averaged around 13k for the £72k, you'd have to both significantly increase the attendance and change the whole mindset/culture of the fan base to squeeze out and decent money given the constraints of thr compass contract.

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[wingy]

Its also wrapped up in the compass contract, so the profit margin isn't that good. I remember from the ACL Q&A on the trust website , the profit margin was only about 11%, and we only get a portion of that. Given that we averaged around 13k for the £72k, you'd have to both significantly increase the attendance and change the whole mindset/culture of the fan base to squeeze out and decent money given the constraints of thr compass contract.

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It wasn't that great at HR also as I recall.
Think Compass got involved there too over the last few years.
Also seem to recall someone related to us was involved with them back then too.?

 

[Brylowes]

Its also wrapped up in the compass contract, so the profit margin isn't that good. I remember from the ACL Q&A on the trust website , the profit margin was only about 11%, and we only get a portion of that. Given that we averaged around 13k for the £72k, you'd have to both significantly increase the attendance and change the whole mindset/culture of the fan base to squeeze out and decent money given the constraints of thr compass contract.

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Agreed, but that £72.000 is for nowt, no staff, no produce no nothing, if we can't attract
Enough customers where does the blame belong.

 

[Brylowes]

Did compass just walk in and take over, or did the club sell them the right.

 

[stupot07]

Did compass just walk in and take over, or did the club sell them the right.

At the Ricoh? It was nothing to do with the club, it was ACL. They run all events at the Ricoh.

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[Brylowes]

At the Ricoh? It was nothing to do with the club, it was ACL. They run all events at the Ricoh.

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Because there it would have been theirs to sell, don't all stadiums use outside catering.

 

[stupot07]

Because there it would have theirs to sell, don't all stadiums use outside catering.

No idea and don't really get your point. Compass paid acl for the privilege so regardless of the cut we get, that's another bit of revenue our current arrangements mean we don't get. Thats not saying look we are hard done by, just a fact. We get get a tiny bit of parking, a small bit of f&b and that's it.

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[wingy]

Because there it would have theirs to sell, don't all stadiums use outside catering.

Most major venues outsource to someone such as Compass

 

[shmmeee]

The whole set up is for someone getting 20k+ crowds and that ain't us. We're going to have to either get bigger, get taken over, or get out basically.

 

[dongonzalos]

Did compass just walk in and take over, or did the club sell them the right.

No we sold our share of ACL unfortunately

 

[Captain Dart]

Did compass just walk in and take over, or did the club sell them the right.

ACL sub contracted to them, but Compass provide staffing at loads of venues, Aviva Stadium Dublin, Twickenham, Stamford Bridge, Bramall Lane to name but a few. Its not an unusual arrangement, whether it is commercially advantageous is a different matter.

 

[oldskyblue58]

Going to correct something on the F&B.

What the club get is 50% of the net profit on F&B with no costs to pay or risk to take. So the net profit margin on F&B is 144K in total. I believe this was for the 2015-16 season

Average league crowds for 2015-16 were 12570 or a total 289110 according to the Wasps accounts spend per head at football matches was £1.97 = turnover 569546 Gross less VAT = 474462

That gives an actual margin of 30% (For those who cannot do simple maths this gives the club 15% ie a 50:50 split)

What CCFC get is dependent on attendances to a great degree. If those fall much further then will there be a profit to share at all?

TF would dress it up that they don't get the full effect for SCMP purposes which is correct, however the amount to be included in that calculation would be a max of £144k (you have to deduct the costs from the turnover and what is left is what counts)

The match day expenses would to a large degree be payable if CCFC owned the stadium (the additional cost is really if ACL put any mark up on those costs)

I would think the next deal would be higher, how much so is debateable. It is going to depend on how long the club is signing up for if at all. If we get relegated does it make sense to the London number crunchers to stay there at all?

As far as I remember what Compass paid for was £4m for 23% of the shares in IEC Experience Limited. Not sure they have paid a fee for the rights to supply.

Corporate hospitality is sold by CCFC (see club website). What they get is what they (CCFC) can sell. However what they get charged is unclear and possibly the margin is not that great, depends on the contract.

Average 10000 crowd is going to achieve around 90k to 100K per match in ticket sales alone. rent per match £4350 plus match day expenses (which all teams pay it isn't a peculiarity to being at the Ricoh) - I would think it costs in region of £300k to be there per season and the club should be bringing in around 2.1m in ticket sales alone

 

[RFC]

Did compass just walk in and take over, or did the club sell them the right.

The contact for catering rights is with WASPS!

 

[RFC]

Going to correct something on the F&B.

What the club get is 50% of the net profit on F&B with no costs to pay or risk to take. So the net profit margin on F&B is 144K in total. I believe this was for the 2015-16 season

Average league crowds for 2015-16 were 12570 or a total 289110 according to the Wasps accounts spend per head at football matches was £1.97 = turnover 569546 Gross less VAT = 474462

That gives an actual margin of 30%

What CCFC get is dependent on attendances to a great degree. If those fall much further then will there be a profit to share at all?

TF would dress it up that they don't get the full effect for SCMP purposes which is correct, however the amount to be included in that calculation would be a max of £144k (you have to deduct the costs from the turnover and what is left is what counts)

The match day expenses would to a large degree be payable if CCFC owned the stadium (the additional cost is really if ACL put any mark up on those costs)

I would think the next deal would be higher, how much so is debateable. It is going to depend on how long the club is signing up for if at all. If we get relegated does it make sense to the London number crunchers to stay there at all?

As far as I remember what Compass paid for was £4m for 23% of the shares in IEC Experience Limited. Not sure they have paid a fee for the rights to supply.

Maybe wrong but was informed the Club get 15%?

 

[Captain Dart]

The contact for catering rights is with WASPS!

Simplistic nonsense.

Maybe wrong but was informed the Club get 15%?

Yes, 1/2 of 30% profit margin = 15% of turnover = ~£72K, OSB explained it above except the terminally stupid like yourself seemingly can't read or understand basic maths.

 

[oldskyblue58]

The contact for catering rights is with WASPS!

they supply IEC which is a subsidiary of ACL which is owned by Wasps Holdings

IEC has a contract to supply ACL/Wasps

 

[Hobo]

When you have owners/main tenants/ management company/ catering contract/.....then a tenant, there will not be much left for the tenant. That is not rocket science. But SISU strategy has left us in this situation.

The only answer is massive investment which SISU won't do because they already passed up on the cheaper option.

The situation is really bleak and I don't think we have reached the bottom of the cycle yet. Sorry.

 

[tisza]

the f&b spend has been under 2 pounds a person for years. don't think it includes the corporate hospitality as that was sold differently.

 

[chinamans view]

Yes the thing is we make a profit however small, but if we owned the stadium with all the up keep costs etc. we would I'm sure make a loss with attendances as they are at present , renting is not all bad as Simon Jordan said.

 

[Captain Dart]

Yes the thing is we make a profit however small, but if we owned the stadium with all the up keep costs etc. we would I'm sure make a loss with attendances as they are at present , renting is not all bad as Simon Jordan said.

Having a known fixed contract with a known outlay de-risks the operation but reduces potential. Swings and roundabouts.

 

[chinamans view]

Having a known fixed contract with a known outlay de-risks the operation but reduces potential. Swings and roundabouts.

Agreed and Sisu are shorted sighted

 

[skybluebeduff]

From what I understand we don't get any (and never have) of the stadium sponsorship and in terms of advertising hoarding we only get pitchside as they are temporary and removed for wasps matches.

IIRC we get a cut of the parking but parking plus f&b share was only about £74k combined. No idea what % wasps get, they have commissioned off parking to acpoa (sp?), I imagine they have paid wasps a flat fee up front.

When acl were renegotiating before sixfields they wanted to put up matchday costs to £12k per game.

And from whats been posted in here wasps charge commercial rate for corporate and we have to pay for the whole suite, regardless of whether we fill them or not

You've also got to factor in the next deal will be considerably more than the £100k pa rent we pay now.

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Why will the next rent deal be more?

 

[letsallsingtogether]

The Club must also get some advertising rights.
At the front of block 16 there is an advertising board saying to advertise here get in touch with CCFC.
Why would they pick it if they got nothing?

 

[skybluebeduff]

Maybe wrong but was informed the Club get 15%?

It's been a long 3 weeks.... any more news about it? I've aged 4 years since we last heard...

 

[stupot07]

Why will the next rent deal be more?

Because wasps have a £4m black hole to fill, they naturally need to maximise any cash they can get in and that will include increasing rent when we renegotiate. The current deal was agreed prior to them arriving and as such their needs were never taken into a account. It would be niaive to think that any new deal will be on anywhere near as favourable terms as the current deal.

Do you think the new deal will continue to be £100k pa?

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[skybluebeduff]

Because wasps have a £4m black hole to fill, they naturally need to maximise any cash they can get in and that will include increasing rent when we renegotiate. The current deal was agreed prior to them arriving and as such their needs were never taken into a account. It would be niaive to think that any new deal will be on anywhere near as favourable terms as the current deal.

Do you think the new deal will continue to be £100k pa?

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Not a clue what it would be, hence why I asked

 

[NortonSkyBlue]

There is and always has been confusion about Compass contract, it was a joint venture partnership aimed at providing a great hospitality package and provide the club with a guaranteed percentage of profit.
In the catering world 5% profit is a great deal considering all staffing and product costs are taken out of the equation(the caterer would make their money from purchasing deals with a percentage returning to them) and if the club had managed its own catering as it used to it would have been a loss maker and a ball ache to run especially with our ever decreasing fanbase. This was outsourced and the club received a good deal based upon where we were as a club and our then relationship with ACL. Sadly we are no longer that club and no longer attractive to customers. Also you must take into account the Northampton year where Compass would have been losing money.
Also any contract was based upon projections over a number of years with a sliding scale of profit ( busier we were the more profit we received) that well and truly is no longer the case. At some point I suspect ACL and Compass revised the contracts downwards and Compass took on a greater percentage of the risk and reward. I suspect without Wasps they would be losing vast amounts and probably with them and us and all the other Ricoh business through the week they should be doing quite nicely.

 

[stupot07]

Not a clue what it would be, hence why I asked

I think its a fairly solid assumption, and one that OSB has also made.

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[Captain Dart]

The Club must also get some advertising rights.
At the front of block 16 there is an advertising board saying to advertise here get in touch with CCFC.
Why would they pick it if they got nothing?

SISU's tactics have managed to lose the club a lot of former sponsors (e.g. Coventry Building Society).
You only need to look at other league one clubs web sites to see the lists of their (often local) sponsors, below is Sheff Utd, you won't find much on CCFC site.

 

[Captain Dart]

There is and always has been confusion about Compass contract, it was a joint venture partnership aimed at providing a great hospitality package and provide the club with a guaranteed percentage of profit.
In the catering world 5% profit is a great deal considering all staffing and product costs are taken out of the equation(the caterer would make their money from purchasing deals with a percentage returning to them) and if the club had managed its own catering as it used to it would have been a loss maker and a ball ache to run especially with our ever decreasing fanbase. This was outsourced and the club received a good deal based upon where we were as a club and our then relationship with ACL. Sadly we are no longer that club and no longer attractive to customers. Also you must take into account the Northampton year where Compass would have been losing money.
Also any contract was based upon projections over a number of years with a sliding scale of profit ( busier we were the more profit we received) that well and truly is no longer the case. At some point I suspect ACL and Compass revised the contracts downwards and Compass took on a greater percentage of the risk and reward. I suspect without Wasps they would be losing vast amounts and probably with them and us and all the other Ricoh business through the week they should be doing quite nicely.

Ermmm... you don't seem to understand this IEC contract isn't just for matches it is all the catering at the Arena, it includes all the shows they put on and the day to day stuff, not sure how the hotel works as thats' a Hilton franchise operation now. Compass may even be in the Casino too? IEC turnover was £6.6M in the last ACL accounts.

 

[oldskyblue58]

There is and always has been confusion about Compass contract, it was a joint venture partnership aimed at providing a great hospitality package and provide the club with a guaranteed percentage of profit.
In the catering world 5% profit is a great deal considering all staffing and product costs are taken out of the equation(the caterer would make their money from purchasing deals with a percentage returning to them) and if the club had managed its own catering as it used to it would have been a loss maker and a ball ache to run especially with our ever decreasing fanbase. This was outsourced and the club received a good deal based upon where we were as a club and our then relationship with ACL. Sadly we are no longer that club and no longer attractive to customers. Also you must take into account the Northampton year where Compass would have been losing money.
Also any contract was based upon projections over a number of years with a sliding scale of profit ( busier we were the more profit we received) that well and truly is no longer the case. At some point I suspect ACL and Compass revised the contracts downwards and Compass took on a greater percentage of the risk and reward. I suspect without Wasps they would be losing vast amounts and probably with them and us and all the other Ricoh business through the week they should be doing quite nicely.

The joint venture between Compass and ACL that is IEC came in to existence in April 2012. A year before CCFC went in to administration and then off to Sixfields. It hived off the supply side of the stadium in to a separate entity. It was also about this time in 2012 that ACL decided it could not be reliant on CCFC and had to drive other incomes, and that CCFC started publically saying they would build their own stadium. Not sure it was ever intended to guarantee CCFC anything but IEC was something that an investor could potentially buy in to without necessarily buying in to ACL

The year CCFC were at Sixfields actually kick started, through necessity, the ACL business but due to lead times and cash flow problems there were issues. Were Compass hurting? not sure they were as they supplied staff on zero hour contracts and purchases as needed. The Ricoh is not a significant part of Compass business - Compass (at Ricoh) are part of a huge international group - but it is a good business for them to have

Last Wasps Group financial statements showed a total turnover of 31m, of that CCFC could possibly have contributed £100k rent £200k match day expenses and £475k in F&B total income or about 2.5% of the Wasps Group turnover. Take out the associated costs and how important is the current CCFC to them? It doesn't seem to me that the net amount is significant at all (Rent £100k, mark up on match day expenses say £40k (pure guess) and £72k in Wasps share of the F&B). That ought to make some people think ...............

 

[NortonSkyBlue]

Ermmm... you don't seem to understand this IEC contract isn't just for matches it is all the catering at the Arena, it includes all the shows they put on and the day to day stuff, not sure how the hotel works as thats' a Hilton franchise operation now. Compass may even be in the Casino too? IEC turnover was £6.6M in the last ACL accounts.

"I suspect without Wasps they would be losing vast amounts and probably with them and us and all the other Ricoh business through the week they should be doing quite nicely."
I am well aware, which is why the sentence above was included. From 2001 to 2007 I worked for Compass and we had many contracts with business and industry and entertainment(this one was not in my area) This was projected to be a medium sized contract with the hotel, that was later franchised out to DeVere and now Hilton as you say.
In the initial stages there was some losses as there was very little exhibition business but fair conference trade. Concerts, which were projected to take place throughout the close season, did not happen very often so the venue relied on CCFC hospitality and the hotel for the major part of the income stream, which to be fair was expected and as the venue was new it was popular.
The problems started before the contract started as the facilities were not ready by the time the stadium opened and as with CCFC the anticipated buzz that surrounded the venue dissipated. The move to Northampton really shook things up and actually forced them up their game and they became leaner and better at sales and marketing the venue by necessity.
Things have changed significantly for better with Wasps at the stadium and more exhibitions taking place which leads to more hotel rooms being booked.
The revenue you posted would included venue hire(including concerts for Rhihana and Bruce Springsteen) and franchise fees as well as concession fees. The catering part of it would be much less than 1m if it was CCFC alone but since our landlords have come in hospitality has blossomed and so coincidentally I am told has exhibition and hotel bookings.