Chairman: Why it's so tough to keep competing

It was a year when difficult and brave decisions had to be made in order to put the club in the best possible position ahead of the new TV deal'.

Now seven months on, and against all the odds, Blackburn Rovers are closing in on a third successive top 10 finish, as they aim to become the highest-placed town team in the toughest league in world football.

But if Rovers are to sustain their current levels of success, then some tough challenges lie ahead.

In an exclusive interview, we put John Williams on the spot and asked him some pertinent questions about the last 12 months, and where he sees the club going in the future.

John, some fans were slightly disappointed the club was not more active in the January transfer window, particularly in light of the new TV deal, which has boosted revenue by around £14m a year. Has that money already been spent and, if so, on what?

Subject to league position, we will get an extra £14m a year through the new TV deal.

This becomes netted down to £11m, because we are not getting the £3m donation from the Walker trustees that we have had in previous years.

We also made a loss of £3m in the last financial year, which knocks it down to £8m, and we are paying an extra £3m in wages this year, so that reduces it to £5m.

On top of that, we've also lost some revenue as a result of early exits from Europe and the FA Cup this season, so that reduces it by a further million, and you are then coming down to the kind of operating profit (£4m) that we are on target to make in this financial year.

But, of course, most of that cash is needed to cover the overhang of transfer costs from the previous two years (most transfers are paid in installments over several years).

However, the other reason why we didn't buy anyone in January was because there was no-one on the market that was within our reasonable budget.

We didn't even make an offer for our number one target in the end because it was quite clear that the player wasn't for sale.

We also had another potential target, which would have involved one player leaving and another one coming in, but that didn't happen because we couldn't pull it off.

Other than that, no-one moved in January, within our budget, who Mark felt was able to improve our squad.

With regards to the increase in wages, I notice from the accounts for the last financial year that wages went up from £33.3m to £36.7m, meaning the wages to turnover ratio was 85 per cent. Does that ratio worry you?

It can't be sustained at 85 per cent. We can run in the low 70s, and, ideally, I would prefer if it was in the mid-to-high 60s.

There is some light at the end of the tunnel, though, in terms of the increased turnover as a result of the new TV deal.

We took the conscious decision to run at a high level last year because we were heading into a new TV deal, and we bought a considerable number of players at the right price to make sure we stayed in the league so we could then be beneficiaries of that extra revenue.

We will reduce that figure into the 70s this year, but I'd still like it to be lower.

However, in many ways, this is a false measure for us because it isn't a measure of the absolute amount of our wage bill; it's more a reflection of the relative size of our turnover.

And the only thing in our turnover that is relatively small is our gate income.

Unfortunately, many of the other clubs in the league can afford to pay the wages that we are paying or considerably more, and that amounts to considerably less of their turnover, due almost without exception within our peer group clubs to their gate revenue.

At a time when wages are clearly on the increase, this is a worry.

How would you go about making the Premier League more of a level playing field then? Do the authorities need to look at fairer ways of distributing the wealth?

Yes, I think there has to be more progress regarding even dis-tribution of domestic television revenues in the Premier League if we want to keep the diversity in the league that town clubs like Rovers bring.

No-one will ever convince me that the Premier League isn't a better place for having a variety of geographical locations, based on football history and achievement, as well as the size of the populations.

That has got to be good. You also have to have a situation where teams can come up, give it a go and do well.

It would suit me, in a business sense, to say wouldn't it be marvellous if we had a closed shop, with no promotion and relegation?' But I could never go with that in a million years because that would be the death knell of football.

I still have this romantic notion that teams can come up and stay up, but that is becoming harder and harder.

Given the level of Rovers' turnover, does that mean the 'globalisation' of the Premier League is more important than ever to a club of Blackburn's size?

Yes, but I could also argue that we are too heavily dependent on TV revenue.

If you used the gate revenue on the other side of that equation then the percentage of our revenue that is TV money is very high.

That's why we have to take an ongoing view all the time about the value of the next TV deal, and our player contracts have to be more or less in harmony with those projected figures going forwards.

One of the current views is there's considerable mileage in the overseas market and that could continue to increase.

Therefore, opportunities to exploit our brand within that market are important.

Is that why you backed the Premier League's proposal to investigate the possibility of playing a 39th game abroad then?

There are advantages to that for Blackburn Rovers but they could also easily be outweighed by other factors that we just don't have the detail on, in particular how you decide who plays who and where.

I thought Richard Scudamore summed it up perfectly on the television last week when he said all 20 of his member chairmen have lots of questions and his job is to provide the answers over the next 12 months, when a decision is to be made.

In principle, I like the idea of all 20 clubs being involved.

The potential income for us from one game is more than our total season ticket revenue.

I fear if it's not done on a collective basis then we could at some time in the future see one-off games leaving our shores.

So the idea is certainly worth further examination and that's why we voted for it, along with the other 19 clubs. But plenty of work still needs to be done.

So it's an opportunity for you to get Rovers' brand into markets you might otherwise not be able to?

I think it's fair to say it's highly unlikely we'd be able to do that on our own, let's put it that way.

The whole debate about the 39th game has led to fresh accusations of greed in the Premier League. How do you feel about that?

The one thing I do resent, and it does niggle me, is this constant reference to greedy Premier League clubs.

There seems to be an obsession in parts of the media to portray the Premiership as greedy.

But let's get this into our perspective; Blackburn Rovers is not a greedy football club.

We might be over-optimistic spending 85 per cent of our turnover on wages, but we are certainly not greedy.

The Walker trustees have put in £40 million since Jack Walker died, so where is the greed there?

We are not greedy for admission prices either; we've got the lowest admission prices in the Premier League, and our price structure, quite frankly, is more in line with the Championship than some Premier League clubs.

So call us over-ambitious, or accuse us of letting the heart rule the head in the boardroom for trying to keep the Premier League dream alive for Blackburn Rovers, but don't call us greedy, because that is not right.

If people want to say we pay our players too much, then they are entitled to that view.

But the reality is we operate in a market place and you have to pay the going rate to stand any chance of being competitive.

You mentioned the Walker trustees thereit would appear from looking at the accounts that the trustees are not currently donating the £3 million-a-year that they have in the past. Are they no longer willing to back the club financially, now that you have become effectively self-sufficient?

To date, they haven't put the £3 million in this year, but nothing is forever, and they haven't said they won't continue to support the club in the future.

I think they will look at each situation as and when.

We still have active leads, in terms of potential purchasers of the club, and should they all become extinguished then the trustees may take a different view.

I don't think they are saying that anything is currently set in stone.

They have supported the club to the tune of £3m-a-year for the last six years, and £40m in total since Jack died, which is not inconsiderable.

There has not been a cutting of that relationship, with them saying 'we will never give you any more money'.

We all know that Jack ultimately wanted the club to be self-sufficient, and I think it's a fantastic thing in many ways to say we have now virtually reached that position.

But for how long we can continue to pull that off with the gate revenues that we've got, when there's an increasing trend for big city success in the league, is difficult to say.

It would be a travesty if an accident of geography, and the population of your town, decided your league position, or ultimately even your league status.

It's a threat for Blackburn Rovers, and it may require us to seek external help again from our owners in the future.

Does that situation highlight the need to attract fresh investment sooner rather than later?

I think you can see what's happening in the league; more and more clubs have changed hands, and it would be great if Rovers could find a new owner who could help us move the club forward.

But let's not forget we are a top half Premier League side now, and moving us forward from here is no easy feat. In fact, so is sustaining and preserving what we've already got. We've always said Jack's boots are big ones to fill.

What is the latest on the takeover front? Are there still interested parties at the table?

Yes, there are. There is interest but these things take a long time to evaluate.

The periods that precede formal due diligence are vitally important because you need to make sure that you are talking to the principals of interested parties, and that those principals understand what the requirements are on the current owner's side of the fence.

As I speak to you today, there are three or four different discussions going on with interested parties, but I've got nothing concrete to say that would indicate a sale is imminent.

But that can literally change with a phonecall.

So there is no way you can put a timescale on it then?

I don't think there is a timescale from the trustees' point of view.

The 'For Sale' sign has been up for the best part of 12 months now.

Our quest for investment is insatiable because we really don't want to increase external debt, which could threaten the financial status of the club. And for similar reasons, the board doesn't want to go down the securitisation route either.

So equity is the best option for us, but finding the right person, or persons, must not be hurried.

Is it inevitable, then, if you don't find a new investor that you might have to start trading players to enable Mark to freshen things up in the transfer market?

That will be very much Mark's choice. I'm still of the view that we are not a selling club, we are a trading club, and over the course of the television deal we ought to be able to generate some cash which will enable us to invest in new players.

But trading is still an option, if the manager decides to go down that route.

We have a board and a manager that has preached the mantra of continuity recently, and we think that's the best way forward for Blackburn Rovers.

As a result, we've been busy re-engaging players on longer term contracts, to protect our assets and protect that continuity.

Not only do we think we have some very good players that we want to keep, it is also cheaper for us to do that than try and replace them in an inflated market.

Sooner or later, if competitor activity continues to run like a forest fire, and unless we can find new investment, how long will it be before we have to start selling players, rather than trading players?

I couldn't rule that out in the future. But this is not the time for gloom and doom.

We still think we've got the best squad we've ever had, and we are firing in the right half of the league.

But it's a tough world out there and the transition from the line of trading club to selling club will inevitably come one day, unless we can find our next Jack.

Given the resources you have to work with compared to many of your rivals, do you sometimes feel you don't get enough credit as a football club for what you are achieving?

Without being too complacent, I think any reasonable observer would think what we have achieved is impressive.

We don't always get full credit for it but we are not in the business of back-slapping.

Interestingly, though, I'm now hearing from within my own peer group that people are starting to give us credit for what they call the Blackburn model'.

A lot of other clubs would like to be as successful as we are, with the resources that we've got, and it's very flattering when people say that to you.

But I still think for some there is a Jack Walker factor about the club.

They think there is a bottomless well here that we can keep dipping in and out of, and that is simply not the case.

The bottom line is we are overachieving. I know some fans hate the phrase, 'We are punching above our weight', and I think that's because there's an implication within it that you are a lightweight, not a heavyweight.

I'd rather describe us as the middleweight boxer in great condition, who is aspiring to put on the weight rather than shed it.

I think the biggest dilemma for us as a board is the high wages to turnover ratio.

We are damned if we do, and damned if we don't.

Our business heads tell us the ratio is too high, but our football hearts tell us there will be a real threat to the status of the club, in terms of retaining its Premier League position, if we cut the wages.

On reflection, this is not the football heart, it's the football head, and I will put the challenge to remain competitive in the Premier League above all else.

So, looking into your crystal ball, how do you sustain the levels of success you are currently enjoying over the next few years?

I think the key is continuity - in terms of the football staff, and the players.

In addition to that, we look to the Academy to produce players good enough to play in Blackburn Rovers' first team, which is no easy task.

We have to try to keep the wage bill under control but, in tandem with that, we also have to explore every possible means of increasing turnover.

We also need to keep faith with our fan-base by ensuring football is affordable and, in turn, we want a full and lively Ewood Park.

Everybody associated with Blackburn Rovers has to stretch themselves for this proud club to continue to make an impact in the most demanding football league in the world.