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PATRICK SMITH
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Nightmare scenario for Colless
June 03, 2003
WHEN Richard Colless took charge of the Sydney Swans in 1993 he had one main wish: he wanted to leave the club in better shape than he found it.
Well, the chairman is running out of time. History suggests time is the very thing of which chairmen of the Swans do run out. Time. And money, of course. Lots of money.
It is hard to imagine the chill that spread down the spine of Colless last year when he realised that within eight weeks what he thought would be a break-even result at the end of the season was actually a million dollar loss and more hurtling towards him.
Costs were exploding. There was not much change from $800,000 after promoting the club's three games at Telstra Stadium. The growing pull of the Rugby World Cup had exacerbated an already dwindling corporate and membership base.
Colless is a director of the Swans and quite a few other businesses. He knows his legal responsibility. The Swans soon won't be able to pay their bills. Without immediate assistance from the AFL they will go belly up in the harbour city. So the club officially has asked for an injection of funding. A million big ones won't be enough. It is that serious.
It was back in March that we warned that Sydney was not the club it seemed. Brash and confident: cashed up enough last year to try to woo coach Terry Wallace away from the Bulldogs. It was a veneer ruthlessly exposed when Colless and his board called in the AFL corporate doctors Olaf O'Duill and John Kelly late last year.
The club have adopted most of the principles and systems suggested by the financial locums. The Swans had no other choice. They were the highest spending club ? $12.5 million last year on their football department compared to St Kilda's $9.3 million ? yet their revenue was evaporating.
In the Sydney market you cannot have a bad week let alone a poor season. Last month the ticket and corporate sales for the World Cup had topped $160 million. At the same time the Swans were pulling back their budget costs by a massive $4 million.
In the five years since they were last supported by the AFL their revenue had fallen $5 million despite a steady increase in the AFL annual distribution. Colless, as chairman and director, cannot walk away from the fact that the club have been badly run. In fairness, he does not attempt to.
The club are seeking a new chief executive. Kelvin Templeton left at the end of last year and replacement Colin Seery indicated recently he was looking elsewhere for new challenges. Already the club has received offers of interest from overseas and locally. Colless said the club were undecided whether to advertise. But the new CEO would have to have a strong commercial background. Colless said the successful applicant would need to be able to lead the Swans both as a club and a business.
What must concern Colless deeply is that his board did not see this coming. There were no warning signs until late last year. Then it simply got worse by the month.
Now, two Swans directors are working full-time on the club administration. Colless and fellow board member Andrew McMaster put their case for assistance to the AFL.
Their blueprint for the future has been accepted. The new business plan is vastly different to the old.
What was blue-sky thinking is now conservative, with outgoings matched religiously by income drawn from sponsorships, gate receipts and attendances.
The shake-up at the club has been profound ? Colless argues that it could have been nothing less ? and will continue to be. Colless identified the five most important positions in the club. Chief executive, coach, head of football, head of commercialisation, and head of recruiting.
Andrew Ireland is the new head of football, Paul Roos is the coach, a chief executive is to be announced and therefore the commercialisation position remains vacant and the recruiting department is under review.
The board will be revitalised with three positions vacant at year's end. Ron Barassi has stepped down as have Graeme Pash and John Yates. It is another rebirth of the Swans.
The club moved from Melbourne to Sydney in 1982, was sold to Dr Geoffrey Edelsten for effectively $2.9 million in 1985, sold back to the AFL in 1988 for $10. Later that year the licence was passed on to a group of businessmen headed by Mike Willesee. Four years later the remaining licence fee was waived and the club given three year's working capital. In 1993 the owners declared the club could not continue and the AFL intervened, naming Alan Schwab as executive director.
Before there can be any more money headed north, the commission must convince the AFL clubs there is no other choice. The past shows they have rescued the Swans more times than Tony Lockett.
From 1994 until 1998, the AFL bankrolled the club with $4.3 million. An agreed allocation of $500,000 for season 1999 did not go ahead by mutual agreement between club and the AFL because the Swans had begun to turn a profit.
Now, a decade after Colless joined the Swans he has them in no better shape. It humbles and angers him. His dream teeters on a nightmare.
PATRICK SMITH
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Nightmare scenario for Colless
June 03, 2003
WHEN Richard Colless took charge of the Sydney Swans in 1993 he had one main wish: he wanted to leave the club in better shape than he found it.
Well, the chairman is running out of time. History suggests time is the very thing of which chairmen of the Swans do run out. Time. And money, of course. Lots of money.
It is hard to imagine the chill that spread down the spine of Colless last year when he realised that within eight weeks what he thought would be a break-even result at the end of the season was actually a million dollar loss and more hurtling towards him.
Costs were exploding. There was not much change from $800,000 after promoting the club's three games at Telstra Stadium. The growing pull of the Rugby World Cup had exacerbated an already dwindling corporate and membership base.
Colless is a director of the Swans and quite a few other businesses. He knows his legal responsibility. The Swans soon won't be able to pay their bills. Without immediate assistance from the AFL they will go belly up in the harbour city. So the club officially has asked for an injection of funding. A million big ones won't be enough. It is that serious.
It was back in March that we warned that Sydney was not the club it seemed. Brash and confident: cashed up enough last year to try to woo coach Terry Wallace away from the Bulldogs. It was a veneer ruthlessly exposed when Colless and his board called in the AFL corporate doctors Olaf O'Duill and John Kelly late last year.
The club have adopted most of the principles and systems suggested by the financial locums. The Swans had no other choice. They were the highest spending club ? $12.5 million last year on their football department compared to St Kilda's $9.3 million ? yet their revenue was evaporating.
In the Sydney market you cannot have a bad week let alone a poor season. Last month the ticket and corporate sales for the World Cup had topped $160 million. At the same time the Swans were pulling back their budget costs by a massive $4 million.
In the five years since they were last supported by the AFL their revenue had fallen $5 million despite a steady increase in the AFL annual distribution. Colless, as chairman and director, cannot walk away from the fact that the club have been badly run. In fairness, he does not attempt to.
The club are seeking a new chief executive. Kelvin Templeton left at the end of last year and replacement Colin Seery indicated recently he was looking elsewhere for new challenges. Already the club has received offers of interest from overseas and locally. Colless said the club were undecided whether to advertise. But the new CEO would have to have a strong commercial background. Colless said the successful applicant would need to be able to lead the Swans both as a club and a business.
What must concern Colless deeply is that his board did not see this coming. There were no warning signs until late last year. Then it simply got worse by the month.
Now, two Swans directors are working full-time on the club administration. Colless and fellow board member Andrew McMaster put their case for assistance to the AFL.
Their blueprint for the future has been accepted. The new business plan is vastly different to the old.
What was blue-sky thinking is now conservative, with outgoings matched religiously by income drawn from sponsorships, gate receipts and attendances.
The shake-up at the club has been profound ? Colless argues that it could have been nothing less ? and will continue to be. Colless identified the five most important positions in the club. Chief executive, coach, head of football, head of commercialisation, and head of recruiting.
Andrew Ireland is the new head of football, Paul Roos is the coach, a chief executive is to be announced and therefore the commercialisation position remains vacant and the recruiting department is under review.
The board will be revitalised with three positions vacant at year's end. Ron Barassi has stepped down as have Graeme Pash and John Yates. It is another rebirth of the Swans.
The club moved from Melbourne to Sydney in 1982, was sold to Dr Geoffrey Edelsten for effectively $2.9 million in 1985, sold back to the AFL in 1988 for $10. Later that year the licence was passed on to a group of businessmen headed by Mike Willesee. Four years later the remaining licence fee was waived and the club given three year's working capital. In 1993 the owners declared the club could not continue and the AFL intervened, naming Alan Schwab as executive director.
Before there can be any more money headed north, the commission must convince the AFL clubs there is no other choice. The past shows they have rescued the Swans more times than Tony Lockett.
From 1994 until 1998, the AFL bankrolled the club with $4.3 million. An agreed allocation of $500,000 for season 1999 did not go ahead by mutual agreement between club and the AFL because the Swans had begun to turn a profit.
Now, a decade after Colless joined the Swans he has them in no better shape. It humbles and angers him. His dream teeters on a nightmare.
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