Conclusions and Recommendations

Based on external and internal changes that have occurred recently, the situation around Manchester United is quite perplexed. On one side, financial statements show positive dynamics increasing commercial turnover, changing total turnover structure and increasing total turnover. At the same time operating cost decrease significantly. But still, total profit dynamics are unstable, and that is not good for sports side of Manchester United – they hardly could afford to buy top players and participate in expensive transfers. Internal resources provided by youth academy create significant support for club performance, which is a base for making profit. Still, ownership situation is quite a problem. Not only Glazers pay themselves huge amounts while economizing on transfers and players wages, but they also improve the situation in the club form the commercial perspective.

It is obvious that internal structure of Manchester United has improved since their takeover of the club. On one hand, it has become more perplexed, though efficiency level improves constantly. Restructuring processes demand resources, and that is why such unusual for football club schemes of raising capital are used (bond issue, probable IPO). It seems that even sale and lease-back activities on teams’ training center are reasonable. Evidently through financial performance FC Manchester United is improving its situation as a business entity. Disliked by the fans Glazers seem to have sufficient experience with managing American football team Tampa Bay Buccaneers. But definitely, for them Manchester United brand is much more prospective as it has greater potential market.

Also, a very notable thing is internal competitive advantage of Manchester United’s internal structure from sports side – its coach, Sir Alex Fergusson who is a unique specialist to make any set of players play football at a high level, and the staff of the club. Including Manchester United Youth Academy – it is possible for the team not to rely that much on external sources of staffing players. It is really notable that during the period of Glazers ownership only few expensive transfers have been made, and Manchester United has spent on transfer at least twice less than their closest opponents from sport prospective.

External environment trends are also quite positive for Manchester United, as the situation allows them to stabilize their financial situation in the forthcoming period. Their investments in youth academy will pay off when club will face UEFA assessment for financial fair play. It will also be a strong point for them, taking into the account that most of their direct competitors will have to stop extensive transferexpenditures.

Combining current situation dynamics and possible strategies of development it is possible to conclude, that Manchester United has a strong footing to succeed in both mid- and long-term periods. Their competitive advantages can make good combination with external environment changes. Turning to recommendations it is also necessary to mention good functioning of FC Manchester United as a whole system. Because all the systems of sustainable football club work well, it is possible to conclude that using their internal structure resources Manchester United can overcome their opponents and have strong competitive position in the long term prospective.

Manchester United development strategy is really extensive and it needs financial support. Though, payback period of projects that Manchester United invests in (improving Old Trafford experience, MUTV and other digital media assets) is reasonable and, cash flow that is being organized can keep up with expenses on loans and other debt issues. Increasing turnover is a very good indicator, so Manchester United should concentrate on structure of the turnover – to create sustainability in development. This would allow them to allocate future profits for further success of the team. It is obvious that Glazers’ get really significant amounts from Manchester United profit, but definitely they deserve it.

Further development prospects for Manchester United in conditions of financial fair play are positive, so improving the structure of the turnover is an achievable goal for them. Synchronically, they have to increase audience around the world, in Asia particularly. Asian market is already dominated by MU brand, but population of the region is so enormous, that there is still a potential to grow.

Combined with high sports results, this strategy of development will allow to maximize the value of Manchester United as a company. Should they succeed in brand development and enlarging their market, it is really possible for them to be not only an ultimate football club, but also one of giants of the world economy.

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5 Glazer gets 98% of Man Utd shares. BBC News, June 28, 2005. URL: http://news.bbc.co.uk/2/hi/business/4629401.stm

6 Hamil, Sean (2008). "Manchester United: the Commercial Development of a Global Football Brand". In Chadwick, Simon; Arth, Dave. International Cases in the Business of Sport. Oxford: Butterworth-Heinemann.

7 Ibid.

8 Ibid.

9BBC News, Super Bowl hero takes a slice of Man Utd, 2 March 2003. URL: http://news.bbc.co.uk/2/hi/business/2813439.stm

10BBC News, US investor ups Man Utd stake, 26 September 2003. URL: http://news.bbc.co.uk/2/hi/business/3141968.stm

11BBC News, US bid talk lifts Man Utd shares, 13 February 2004. URL:http://news.bbc.co.uk/2/hi/business/3485393.stm

12BBC News, Glazer stake in Man Utd nears 30%, 19 October 2004. URL: http://news.bbc.co.uk/2/hi/business/3754598.stm

13BBC News, Glazer gets 98% of Man Utd shares, 28 June 2005. URL: http://news.bbc.co.uk/2/hi/business/4629401.stm

14ESPN Soccernet, Man Utd play down fears after £660m refinancing, 18 July 2006URL: http://soccernet.espn.go.com/news/story?id=374009&cc=5739

15Ibid

16 BBC News, Manchester United raise £504m in bond issue. 22 January 2010URL: http://news.bbc.co.uk/2/hi/business/8475317.stm

17UEFA, Club licensing benchmarking report financial year 2009.Available at URL: http://www.uefa.com/uefa/footballfirst/protectingthegame/financialfairplay/

18Transfer expenditure 11/12. URL:http://transfermarkt.de/en/transfers/startseite-km/transfers.html?from=top_navi

19Crunch time for football clubs as costs grow. Financial Times, 9 June 2011

20 Deloitte Football Money League, 2011. URL: http://www.deloitte.com/view/en_GB/uk/industries/sportsbusinessgroup/sports/football/deloitte-football-money-league-2011/66f55ec578ffd210VgnVCM2000001b56f00aRCRD.htm

21 Deloitte Football Money League, 2011.

22 750 million euro for UEFA Champions league football clubs. (Union of European Football Associations) (110): 6–7. August 2011. Retrieved 26 August 2011.

23 Ibid.

24 Kaplan Robert S. David P. Norton (2004). Stratgey Maps: Converting Intangible Assets into Tangible Outcomes. Boston, Massachusetts, USA: HarvardBusinessSchoolPress. pp. 7

25UEFA financial report 2009/2010. URL: www.nfpm.ru/business/document/211

26 Deloitte Football Money League, 2011. URL: http://www.deloitte.com/view/en_GB/uk/industries/sportsbusinessgroup/sports/football/deloitte-football-money-league-2011/66f55ec578ffd210VgnVCM2000001b56f00aRCRD.htm

27 Preliminary offering memorandum. MU Finance plc, 2010. URL: http://i.dailymail.co.uk/pdf/ManUtdProspectus.pdf

28 Players & Staff. Official Manchester United Website, October 2011. URL: http://www.manutd.com/en/Players-And-Staff.aspx

29 Manchester United Pte Ltd. FT Alphaville, August 16, 2011. URL: http://ftalphaville.ft.com/blog/2011/08/16/654461/manchester-united-berhad/

30 PIKing apart the Man Utd refinancing. FT Alphaville, January 11, 2011. URL: http://ftalphaville.ft.com/blog/2010/01/11/123811/piking-apart-the-man-utd-refinancing/

31 Results for Red Football Group for the twelve months ended 30 June 2011. MU Finance Plc, September 1, 2011. URL: http://www.manutd.com/~/media/Files/PDF/Q4_2011_Results_Press_Release.ashx

32 Annual Report and financial statements for the year ended 30 June 2010. Red Football Limited, September 1, 2010. URL: http://mufplc.com/pdf/2009-10%20Statutory%20Accounts.pdf

33 Glazer Family Mulling IPO For Manchester United. Forbes.com, June 13, 2011. URL: http://www.forbes.com/sites/mikeozanian/2011/06/13/glazer-family-mulling-ipo-for-manchester-united/

34 Manchester United announce record profits. Red Flag Flying High, September 1, 2011. URL: http://redflagflyinghigh.com/2011/09/blogs/manchester-united-announce-financial-results

35 Manchester City or Manchester United: Which Financial Model Would You Prefer? Bleacher Report, September 1, 2011. URL: http://bleacherreport.com/articles/830721-manchester-city-or-manchester-united-which-financial-model-would-you-prefer

36 Manchester United debt and ownership explained. Manchester United Blog, March 3, 2011. URL: http://www.stretford-end.com/2011/03/manchester-united-debt-and-ownership-explained/

37 Preliminary offering memorandum. MU Finance plc, 2010.

38 Research conducted by TNS Sport, 2007

39 Manchester United Seeks Singapore IPO. WSJ.com, August 17, 2011. URL: http://online.wsj.com/article/SB10001424053111903392904576511924182918278.html?mod=WSJASIA_hps_LEFTTopWhatNews

40 Ipsos MORI | Rugby Union 'Britain's Second Most Popular Sport' (2003). URL: http://www.ipsos-mori.com/researchpublications/researcharchive/928/Rugby-Union-Britains-Second-Most-Popular-Sport.aspx

41 Preliminary offering memorandum MU Finance plc. p. 1.

42 Man Utd's 333M fans (2008). URL: http://www.mirror.co.uk/sport-old/football/2008/01/08/man-utd-s-333m-fans-115875-20278453/

43 Preliminary offering memorandum MU Finance plc. p. 52.

44 Ibid.

45 AMB Country Risk Report, September 2011. URL: http://www3.ambest.com/ratings/cr/reports/unitedkingdom.pdf

46 Ibid, p.2.

47 Preliminary offering memorandum. MU Finance plc, 2010, p.16.

48 A world map of Internet use and penetration. URL: http://www.kwintessential.co.uk/map/internet-penetration.html

49 Preliminary offering memorandum. MU Finance plc, 2010, p. 2.

50 Ibid.

51 Patriots, Red Sox land on Forbes most valuable list. Boston.com, July 13, 2011. URL: http://articles.boston.com/2011-07-13/sports/29769892_1_soccer-teams-red-sox-nfl-teams

52 Preliminary offering memorandum. MU Finance plc, 2010, p.2-3.

53 Ibid, p. 3.

54 Ibid, p. 20.