Updates on FTF

[RFC_Official]

http://www.richmondfc.com.au/news/newsarticle/tabid/6301/newsid/120092/default.aspx

Latest word from Brendon about what the money is being used for.

 

[NQTIGER]

http://www.richmondfc.com.au/news/newsarticle/tabid/6301/newsid/120092/default.aspx

Latest word from Brendon about what the money is being used for.

awsome stuff, but what happened to the money from the two disasters ,Darwin and cairns?

Was it included in the FTF or did it go into consolidated revenue?

 

[TOOs_Finest]

awsome stuff, but what happened to the money from the two disasters ,Darwin and cairns?

Was it included in the FTF or did it go into consolidated revenue?

Not sure if RFCO is still around, but he mentioned in another thread that the money from those two games was never intended to be included as part of the FTF.

 

[Tzatziki_Man]

I would be interesting to know where that money will go too to be honest, maybe paying for wages? But then what happens to the normal money that we pay for wages, this is a bonus right? Hopefully this gets placed onto our debt too.

 

[TOOs_Finest]

I would be interesting to know where that money will go too to be honest, maybe paying for wages? But then what happens to the normal money that we pay for wages, this is a bonus right? Hopefully this gets placed onto our debt too.

I'm guessing it would be absorbed in various ways:
* debt repayments
* PRO redevelopment
* player payments
* football dept resources
etc.

 

[NQTIGER]

Not sure if RFCO is still around, but he mentioned in another thread that the money from those two games was never intended to be included as part of the FTF.

set me straight, we are in debt, we have to sell games to get out of debt.....

We create an FTF so we can get out of debt and become competetive which we cant be because we are in debt

We sell games to help the FTF so we can get out of debt

We dont use the money from the games we sell to raise the FTF which we needed to get out of debt

So why did we sell the games?

Or is that to simple a question to raise?

 

[TOOs_Finest]

Pretty sure the games were sold off before the FTF was born. Whether or not the allocation of the revenue from those games had been planned beforehand I have no idea, but that's quite possibly the case.

Should every cent of revenue we make be put in to the "FTF" basket? I mean, we still have to run the club.

From what I gathered, the purpose of the FTF was to service debt and fund certain objectives such as PRO re-development and reserves team. The money saved by the demolition of our debt (ie. reduced or no interest payments) would also allow us to be competitive when trying to lure players in years to come.

 

[Tiger2709]

awsome stuff, but what happened to the money from the two disasters ,Darwin and cairns?

Was it included in the FTF or did it go into consolidated revenue?

Why would that be part of the FTF, aren't we signed up for 6 games over 3 years at $500,000 per game, I would think this would be for overall debt reduction, but not part of the FTF, or at least that's how I see it.

 

[telsor]

There is no magic about revenue raised from selling games, or FTF, it's all just revenue.

That the admin claims they'll use revenue raised from one source to do X, and another source to do Y doesn't change the fact that it all goes in (and out) of the same bucket.

 

[TheProwler]

Pretty sure the games were sold off before the FTF was born. Whether or not the allocation of the revenue from those games had been planned beforehand I have no idea, but that's quite possibly the case.

Should every cent of revenue we make be put in to the "FTF" basket? I mean, we still have to run the club.

From what I gathered, the purpose of the FTF was to service debt and fund certain objectives such as PRO re-development and reserves team. The money saved by the demolition of our debt (ie. reduced or no interest payments) would also allow us to be competitive when trying to lure players in years to come.

Yes but we obviously had the debt before the FTF, so surely the funds from selling these games is going into debt reduction?

If it's not going towards reducing debt then what the hell is it going towards?

 

[TOOs_Finest]

Yes but we obviously had the debt before the FTF, so surely the funds from selling these games is going into debt reduction?

If it's not going towards reducing debt then what the hell is it going towards?

Yes, I did mention earlier in the thread that it would be partially going towards debt reduction, but as I also stated, we still have a club to run in the mean time. Without the revenue from these games, who knows if we'd be able to support the current coaching structures, etc?

I'm only answering with what I would assume is logical reasoning, I don't have any inside knowledge or the like.

 

[NQTIGER]

Yes but we obviously had the debt before the FTF, so surely the funds from selling these games is going into debt reduction?

If it's not going towards reducing debt then what the hell is it going towards?

Im no big city lawyer but thats pretty close to the mark.

 

[KiwiTiger]

Yes but we obviously had the debt before the FTF, so surely the funds from selling these games is going into debt reduction?

If it's not going towards reducing debt then what the hell is it going towards?

Gents.

Lets do this this way. If your employer came to you and said;

"Mr Prowler.We've budgeted salaries for the year at $6.5million, being the figure imposed by our parent company in Austin, Florida, but we're only paying out $5.5million in the sum total of everyone's employment agreements. Our revenues for the year are funding the $6.5million salary cost budgeted because sales in our Darwin and Cairns franchises has been through the roof. Why don't we pay you the $1million this year upfront in lieu of next. You can go and buy that house that you and Mrs Prowler always wanted, or invest in those new CDO thingis they're issuing in America at amazing interest rates, and we lock you in for next year and even the year after because we're so nice and paying you in advance."

What would your answer be to your employer?

Haere Ra

 

[TheProwler]

Yes, I did mention earlier in the thread that it would be partially going towards debt reduction, but as I also stated, we still have a club to run in the mean time. Without the revenue from these games, who knows if we'd be able to support the current coaching structures, etc?

I'm only answering with what I would assume is logical reasoning, I don't have any inside knowledge or the like.

No worries bro, I didn't think you had any inside info I was just highlighting the fact that we obviously had debt prior to the FTF and thus the money from selling these interstate games must be going somewhere.


I also thought the FTF was going to be 50/50 debt reduction and Punt Road development but with the 6 mill being almost halfway there (even for my crappy maths that would be almost 3 mill) and Benny reckons we will go close to wiping almost 1 mill of debt by the end of the year. Am I missing something here? How much interest are we/have we been paying whilst languishing at the bottom of the ladder?

 

[TOOs_Finest]

No worries bro, I didn't think you had any inside info I was just highlighting the fact that we obviously had debt prior to the FTF and thus the money from selling these interstate games must be going somewhere.

Yep, all good. I just had to take stock for a moment, since I don't actually have a clue what the club is doing.

The way I see it is, even though I have a mortgage, I don't dump 100% of my pay package into my mortgage each month, or else my family would starve. So I pay some to the mortgage, and some to run the household... and of course, I keep a little in that hidden pocket in my cricket bag for the odd afternoon where I make my way to the Cricketer's Arms before/after the game

Then, if a windfall comes my way, and all of a sudden I find myself with a bonus few dollars somewhere along the way, I might dump it all into my mortgage, or I might put half in the mortgage and half towards that new fridge I've been promising the wife for the past two years... and a little more in the little hidden pocket of course.

 

[MightyTiger]

It seems people have forgotten how the money will be split up via the money coming through from the FTF, I found this post on another forum by rosy23 from Punt Road End all credit goes to her for this post.

Dear Rosy,

Firstly, thankyou for your outstanding support of the FTF. To raise $8000 thus far, in addition to your existing support is a terrific effort and one that is greatly valued. Could you please pass on my appreciation to all your Punt Road End subscribers.

Your question is a valid one and I would be only too happy to clarify our position.

I have consistently stated that the FTF is a collective, concerted effort to raise funds in order to retire debt and invest in our football program. Importantly, these objectives aren’t mutually exclusive in that we don’t have to pay down debt entirely before we can make the investments in football we need. Simply stated we will do both simultaneously hence the 1:1 debt/football ratio.

The “0” in the 3-0-75 Strategic Plan contemplates being debt free by 2014. The FTF launched just over 5 weeks ago will see us make significant inroads into the debt and lessen the interest burden. However, to direct all monies into debt at the expense of extremely important “mission critical” important investments in football is considered counter-productive.

Furthermore by reducing debt we reduce our annual interest expense and therefore free up further funds for future re-investment.

Our priorities in football are:

1. The redevelopment of the PRO.

· the historic relocation of the Richmond Cricket Club after 150 years at PRO means that we have access to the oval 365 days a year, 24/7

· also means that we have an opportunity to redevelop PRO into an elite, fit for purpose football facility both on and off field which is a massive benefit to our coaching staff and players

· redevelopment works will include removal of all cricket wicket tables, widen and lengthen oval, improve drainage and soil profile, laser level and resurface

· the works are estimated to cost in the vicinity of $1.5 million which is not budgeted for in the Club’s 2011 budget.

2. Pre-payment of TPP

· We are currently paying at the lower end of the salary cap as you would expect with a young and developing team. However, at the moment we are in a position where we could be pre-paying players’ salaries (i.e. paying a portion of the players’ 2012 salaries in 2011). By not prepaying salaries we are “wasting” the difference between our current player payments and the salary cap. That is, this increment is lost and not made available for us in future years.

· Should we prepay salaries in this way we are freeing up room in our salary cap in future years. This places us in an excellent position to both retain our emerging playing list and attract elite players to our Club. This is particularly relevant at the current time as pressure to retain players intensifies in light of the introduction of the Gold Coast Suns and Greater Western Sydney, and the introduction of “free agency”.


1. A RFC reserves team

· Our alignment with Coburg is a very strong one. The Coburg Football Club is well governed by Bill Balakis and his administration. However, we believe that to best prepare our young players for the elite AFL standard of competition we need to control their development in every way. Accordingly, we believe having a standalone team in the VFL competition ensures that the players are exclusively educated in our game style, not that of another VFL Club with its own set of needs / circumstances / objectives / etc. Furthermore, by having a standalone VFL side we can ensure that none of our listed / rookie listed players are forced to play in the VFL Reserves competition which is a long way from AFL standard.


2. High performance

· Whilst the Football Department have relocated into our state of the art Punt Road Oval facilities, we believe that there are further improvements that can be made in terms of high performance standards. Additional resources in terms of human capital and equipment have been identified that would complement our desire to provide the best possible high performance culture in the AFL.


The diagram below gives broad indication of what might be achieved given different levels of funds raised over the course of the campaign.

Finally, in response to your question, all proceeds raised through the FTF will be re-invested in the 50;50 debt / football ratio, not just those proceeds raised on Thursday night.

Once again all credit goes to rosy23.

 

[TOOs_Finest]

Thanks MT.

The issue of TPP is an important one, with regards future planning, and not wasting a resource which is at our disposal. This is what KiwiTiger was getting at.

If we were to agree to pay Tyrone Vickery $1mil over the next four years, and we front loaded his contract (say 4/2.5/1.75/1.75), by paying more than just the minimum 92.5%, then in 3-4 years time, when we are paying him less, we can afford to pay Tom Scully extra to lure him over to Tigerland. The more of that 7.5% over the minimum we pay now, then the more we can allocate to players who's performance demands more later on, or to high profile players who decide they want to come play for us.

2. Pre-payment of TPP

· We are currently paying at the lower end of the salary cap as you would expect with a young and developing team. However, at the moment we are in a position where we could be pre-paying players’ salaries (i.e. paying a portion of the players’ 2012 salaries in 2011). By not prepaying salaries we are “wasting” the difference between our current player payments and the salary cap. That is, this increment is lost and not made available for us in future years.

· Should we prepay salaries in this way we are freeing up room in our salary cap in future years. This places us in an excellent position to both retain our emerging playing list and attract elite players to our Club. This is particularly relevant at the current time as pressure to retain players intensifies in light of the introduction of the Gold Coast Suns and Greater Western Sydney, and the introduction of “free agency”.

 

[Tiger_Stripes]

Gents.

Lets do this this way. If your employer came to you and said;

"Mr Prowler.We've budgeted salaries for the year at $6.5million, being the figure imposed by our parent company in Austin, Florida, but we're only paying out $5.5million in the sum total of everyone's employment agreements. Our revenues for the year are funding the $6.5million salary cost budgeted because sales in our Darwin and Cairns franchises has been through the roof. Why don't we pay you the $1million this year upfront in lieu of next. You can go and buy that house that you and Mrs Prowler always wanted, or invest in those new CDO thingis they're issuing in America at amazing interest rates, and we lock you in for next year and even the year after because we're so nice and paying you in advance."

What would your answer be to your employer?

Haere Ra

Well put.

People claiming the money is not going towards debt reduction and getting us off the bottom are off the mark. It's gross oversimplification to claim that 'we donated this money so this dollar should go there but that dollar should go there and because it goes there it's wasted'. Money the club has now, is money the club doesnt have to spend later. We'll be thankful in 5 years time when our debt is paid off, facilities are finished and, as Kiwi points out, we don't have players jumping ship because we didn't front load their contracts when we could afford to pay what they are worth.

P.S: Kiwi I would love to join your company.

 

[smasha]

"In the meantime, we will continue to work with Coburg to develop a partnership that will provide us with as many of the benefits of a stand-alone side as possible"-Benny Gale.

I love that part.

I thought we should have our own reserves team but Coburg have a rich history in football and 2 clubs working together as one is better than tearing a great relationship down I guess and starting again.

Help each other out to get both clubs up on top and in turn get stronger.

 

[smasha]

It's all in the Richmond people's hands.

We have a ton of fans but I'm not sure if we have people like Pratt or Eddie and his mates.

Struggletown-POWER TO THE TIGER PEOPLE!

Let's build this place up block by block with our own hands.

RICHMOND TILL I DIE!

 

[TheProwler]

Gents.

Lets do this this way. If your employer came to you and said;

"Mr Prowler.We've budgeted salaries for the year at $6.5million, being the figure imposed by our parent company in Austin, Florida, but we're only paying out $5.5million in the sum total of everyone's employment agreements. Our revenues for the year are funding the $6.5million salary cost budgeted because sales in our Darwin and Cairns franchises has been through the roof. Why don't we pay you the $1million this year upfront in lieu of next. You can go and buy that house that you and Mrs Prowler always wanted, or invest in those new CDO thingis they're issuing in America at amazing interest rates, and we lock you in for next year and even the year after because we're so nice and paying you in advance."

What would your answer be to your employer?

Haere Ra

Sustainability? How am I going to live next year?


I remember reading a story only last year about a yank who was a low hcp golfer who was a member at an exclusive & expensive club had all the top gear, dressed very smart, walked and talked money and looked like a millionaire. However he lived in his car in a different street/parking lot every night because he couldn't afford to live his lifestyle and rent or own a house.

In the end we can have the best ground and facilites to train on/in but if we have to close shop because we cant afford our debt and day to day expenses then what's the use of it?

 

[TheProwler]

Well put.

People claiming the money is not going towards debt reduction and getting us off the bottom are off the mark. It's gross oversimplification to claim that 'we donated this money so this dollar should go there but that dollar should go there and because it goes there it's wasted'. Money the club has now, is money the club doesnt have to spend later. We'll be thankful in 5 years time when our debt is paid off, facilities are finished and, as Kiwi points out, we don't have players jumping ship because we didn't front load their contracts when we could afford to pay what they are worth.

P.S: Kiwi I would love to join your company.

With respect we don't have to many at the moment commanding big dollars but in five years that will hopefully change. If so and we are selling games now to fund them front loading their contracts then we will be selling five or six games a year when our now 21 year olds are 26+ and able to go via free agency. Build a sustainable club now with little debt and with that will come success and our players wanting to stay and others wanting to come over.

 

[Ned_Flanders]

With regards to the Interstate games, people need to remember that this revenue will be used to make up much of the shortfall we have suffered from the loss of the pokies to the Blues.

On the "debt first and then anything else" idea, I think the old saying that we can walk and chew gum sums up the approach best.

If we pay off the debt, but still have substandard facilities and a restricted list, we will continue to flounder onfield, and this will impact on revenues by hurting membership and sponsorship growth.

As per the chart a previous poster put up, the idea is to progressively reduce debt and at the same time capital improvements. It's not ignoring the debt, but realizing we need to do other things at the same time. This is especially true with jack, dusty, Cotchin, and lids all looking at much bigger paydays in their next contracts, and to a lesser extent the huge number of kids we have (it will be impossible to keep such a young list on 92% indefinitely).

Finally if the club gets a big profit from better membership sales, merchandise sales, and sponsorship, do you think they will just dump the money in the bank and look at it? I suspect some of that will find it's way to the debt as well, or help with issues likePRO andTPP, allowing more of the TFT to focus on debt

 

[pebblestone]

we don't have players jumping ship because we didn't front load their contracts when we could afford to pay what they are worth.

The concern I have is that if a player does decide he wants to break his contract and move or is lured elsewhere in the final year, the club that takes him will then be paying significantly less to us than market value. ie. we would have already paid say 85+% of the total contract value after 3 years instead of 75%. However the player we replace him with will need to be paid at his market value meaning that if we do fill the salary cap (which I hope we can justify soon), we would be vulnerable to losing value to other clubs.

I know that we are not the only club practicing this and I know that this example is not all that likely but with increasing numbers of players opting out of clubs and Richmond being Richmond you can't blame players for looking elsewhere (don't like it but understand it). I've been terrified for years that guys like Deledio and Foley would eventually get jack of it and bail for a taste of finals. I reckon free agency while not contributing directly to this scenario will further reduce the tradition of club loyalty.

Sorry if I have got off topic.

 

[TOOs_Finest]

The concern I have is that if a player does decide he wants to break his contract and move or is lured elsewhere in the final year, the club that takes him will then be paying significantly less to us than market value. ie. we would have already paid say 85+% of the total contract value after 3 years instead of 75%. However the player we replace him with will need to be paid at his market value meaning that if we do fill the salary cap (which I hope we can justify soon), we would be vulnerable to losing value to other clubs.

A player who wants to break his contract to move to another club has to have the co-operation of his current club to find a trade for him. He can't just say I want to play somewhere else, and ignore the existing contract.

In assessing the option of allowing a player to be traded, then of course the status of his contract will be taken into account. If the club knows they have front loaded the contract, the player will most likely be denied the opportunity to break the contract. I'm not sure if there are options available, if a trade were to be agreed to, which would see the other club pay some monetary compensation in this situation.