Yell Army: How much would relegation cost Norwich City?

Norwich City fans watch as their football team suffered 6-0 defeat to Fulham in 2005, the last time

Norwich City fans watch as their football team suffered 6-0 defeat to Fulham in 2005, the last time Norwich was relegated from the Premier League. Pictures:SONYA BROWNCopy:For: EDP/EN©EDP 2005 - Credit: Archant

Business leaders today spoke of the importance of Norwich City's Premier League survival with one estimate putting the cost of relegation at £50m.

David Freezer, now a reporter at the EDP and Evening News, can't bear to watch on the last day of th

David Freezer, now a reporter at the EDP and Evening News, can't bear to watch on the last day of the 2005 season. Pictures:SONYA BROWNCopy:For: EDP/EN©EDP 2005. Here future EDP and Evening News reporter David Freezer feels the pain of relegation. - Credit: Archant

A new television deal with Sky and BT coming in next season means Premier League clubs will get more in television revenue than ever before – the deal is worth £3bn over three years.

The last time Norwich was relegated from the Premier League in 2005 it sparked a spiral of decay which brought the club to the verge of a financial crisis.

And although the club is now in good shape financially, its future expansion plans could be severely affected by relegation.

The club has a turnover of almost £75m and an annual wage bill of £36.8m giving it the lowest wage bill to turnover ratio in the Premier League.


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The team spending the highest proportion of its income on wages is the Canaries' opponents tomorrow – Reading.

Norwich City also has one of the lowest debts in the Premier League standing at £11.3m.

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But accountancy firm Deloitte has predicted the price of relegation from the Premier League this season at between £40m and £50m even with the increase in so-called parachute payments.

These payments are made to relegated clubs over four years and could be increased to £59m from £48m under proposals put forward by the Premier League.

And it is not just the club which would be hurt by a fall towards the Championship.

Businesses around the ground as well as in the wider area rely on the club to give them a boost.

Caroline Williams, chief executive of the Norfolk Chamber of Commerce, said relegation would be a 'horrible blow' to the county but the impact would not be felt as badly as other regions where football clubs played a bigger role in the local economy.

'Being in the Premier League does a huge amount of good,' she said. 'You notice the impact when everybody is being positive.

'At the moment the business community is nervous about what is happening with Norwich [City FC].

'Businesses are more successful when they feel confident. They will take risks.

'If people are feeling happier and content they run a better business.

'If it [the business community] is feeling down and demoralised and not good about what is happening to Norwich, that will affect hearts and minds which ultimately affects what is happening in their business. There is a knock-on effect.'

Norwich's rise up through the Football League since 2009 has come at the same time as the city has secured its position as one of the UK's top 10 shopping destinations.

And Jonathan Briggs from accountancy firm Larking Gowen said Norwich's Premier League status had given Norfolk more weight.

He said: 'It puts the region on the map. It brings a feel good factor and credibility.

'People have heard of you when you are in the Premiership.'

Mr Briggs said that Premier League games were also important for businesses that sponsor the club and pay for corporate hospitality at Carrow Road.

'It is very hard to get people to give up their own time if they are not in the Premier League,' he said.

Please note the competition to win tickets for the Reading game in yesterday's and Wednesday's papers has now closed.

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