By Claire West
With Premier League football clubs spending unprecedented sums of money on players, many forget about the significant contribution lower league clubs make to local communities.
As the busy Christmas football schedule approaches, the Federation of Small Businesses (FSB) is urging people to 'Keep Football Local', and has looked at how football clubs, many of which are small businesses themselves, contribute to the local economy.
While many of the Premier League clubs are big businesses, the Football League estimates that 95 per cent of the clubs in the Football League are small businesses - and face the same stresses and strains as other small firms.
'Talking tactics: the small business of football', looks at how football clubs throughout all leagues in England contribute to the local economy through awarding contracts to local firms and the charitable work they do, and the FSB calls on Government to help clubs and the community initiatives they support to survive.
Throughout 2010, the news has been full of reports of unpaid tax bills by football clubs, most notably, Portsmouth FC. The sad reality is that most of Portsmouth's debts were owed to businesses local to the club and for less than £1,000. The FSB is urging the Government to ensure that where debt is owed to HMRC it considers the wider implications of forcing a club out of business and leaving local businesses with outstanding debt.
A recent FSB survey found that two-thirds of members from all sectors are engaged in some form of Corporate Social Responsibility (CSR), with a third donating goods/services to local charities, and three in 10 making charitable donations from company profits. Football clubs also embrace CSR, through loaning club facilities to local groups and awarding contracts to local firms.
The FSB recommends that:
*Decision makers, regulators, banks and Government should recognise that the majority of football clubs are small businesses
*The Government should review the tax system to encourage investment in grassroots football through capital investment relief and VAT assistance
*Where 25 per cent of debt owed to HMRC occurs, the Government considers the wider impact of forcing a club out of business
*Government and local authorities should review assistance received to help clubs provide greater charitable and community activities
*All football clubs should source local products and sign up to the Prompt Payment Code and pay invoices fairly
John Walker, National Chairman, Federation of Small Businesses, said:
"Football is a passion across the world, and England has some of the most successful clubs and world class players than anywhere in the world. Because of the success of a few clubs, many people see football as big business when the reality is that many are struggling small businesses.
"Clubs can be significant contributors to local towns with clubs like Norwich City employing around 180 people and other clubs like Brighton and Hove Albion working with schools that care for children with disabilities in the region.
"Targeted support would allow clubs and the community initiatives they support to thrive and grow. We may not be hosting the World Cup in 2018, but with continued support for lower league clubs they can build grassroots players which might just help us win the World Cup, so go out and enjoy a local match this Christmas and help to Keep Football Local."
Gavin Megaw, Director of Marketing and Communications at The Football League, said:
"It's encouraging to read a report that recognises the important contribution that football clubs make as businesses in their local community.
"The strong relationships that exist between clubs and local companies help professional football to thrive in towns and cities throughout the country.
"The League will study the recommendations made by the Federation of Small Businesses in this report with great interest."
Dave Boyle, Chief Executive, Supporters Direct, said:
"Our research on the social value of football clubs highlighted the importance of club's day-to-day activities in supporting the local communities they represent, not just through their proactive community programmes.
"The most critical of those is getting clubs to understand the positive impact they can bring through working with other local businesses for their regular supplies."