Ryan Reynolds and Rob McElhenney have been warned that Wrexham’s squad value will need to be doubled in order to reach the Championship.
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Red Dragons enjoyed back-to-back promotionsPlaying field starts to level out in League OneHollywood co-owners funding ambitious projectGetty ImagesWHAT HAPPENED?
The Red Dragons have enjoyed a meteoric rise under their Hollywood co-owners, with back-to-back promotions taking them from the National League and into League One. Further funds have been invested in the current transfer window, but more will be required in order to remain on an upward trajectory.
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A study by has examined how Wrexham shape up in comparison to clubs that have secured promotion into the second tier of English football across the last four seasons. Their squad size (29 players) and average age (28.3) falls short of the League One mean.
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The more concerning statistics relate to the value of Phil Parkinson’s squad, which is said to stand at £6.76 million ($8.6m). The average for a promoted team is £13.86m ($17.8m). That means Reynolds and McElhenney must find a way of doubling market value while staying inside Financial Fair Play (FFP) and Profit and Sustainability Rules (PSR) – with Wrexham’s wage bill already exceeding 87% of the allowable limit.
WHAT FINANCE EXPERT SAID
Dr Rob Wilson, an expert in football finance and the Head of Finance, Accounting & Business Systems at Sheffield Hallam University, has told : “The only way you can really produce the playing performance is through the acquisition of new players, which is providing many more challenges with regards to headroom on Financial Fair Play and also Profit and Sustainability Regulations. What we need to do with that though is then counter-balance it with additional revenue opportunities that they earn so I would imagine the football club are looking to reduce the relative proportion of wages spent on players as a portion of turnover. They will try to bring down that 87% so that they can obviously comply with FFP. They will do that by moving some players out, reducing contracts for other players and then when they sign any new players to participate, they will be looking to generate a significant amount of additional revenue to push the percentage of wages to turnover. This will help push them towards the 70% threshold which is considered the benchmark, or Gold Standard, for a professional football club.
“In short, they can get promoted to the Championship without breaching FFP regulations. What we have seen from both clubs in League One and League Two is that they generally run themselves in a much more fiscally responsible manner. This means that they are looking to break even and that they are satisfied with a level of sporting performance that means they can generate a surplus, or indeed break even. That gives clubs like Wrexham a slight advantage if they are prepared to push the envelope just a little bit more than their competition. They will be under intense scrutiny and pressure of course as a result of clubs dropping out of the Championship that have potentially got higher budgets. There are some significant clubs already participating in League One so they can do it, but they will have to be very careful with the type of players that they want to bring in and they will need to make sure they generate a bigger proportion of revenue so that they can recover those costs and comply with FFP.”