J-League Management Cup 2016
Ranking of J-League club teams by business management
Based on the publicly available financial information of J-League club teams for 2016, the report quantifies their business management from four perspectives of marketing, management efficiency, management strategy and financial conditions.
- Two aspects of club management: FM and BM
- What is important going forward is to strengthen BM
- Quantification method
- Full text of the survey report [PDF]
- Related topics
Two aspects of club management: FM and BM
We focus on the utilization of data analysis technologies and the improvement of team management.
This is because the combination of data analysis and team management is highly compatible with business. Therefore, the above two focus points can be considered as an effective tool for greatly developing the area of sports business, which is currently under development.
Club team management has two aspects: One is “field management (FM),” which is about how to win games; and the other is “business management (BM),” which is to produce profits as business and expand it.
What is important going forward is to strengthen BM
For club teams, BM and FM are the two wheels of management, and how to balance the two wheels is a very important theme. In fact, the Sports Business Group from Deloitte LLP (United Kingdom) was quick to be aware of this importance, and first began analyzing BM of club teams over 25 years ago. Each year the Sports Business Group at Deloitte LLP (United Kingdom) publishes industry leading commentaries, widely considered to be the source of reference for the sports business industry around the world.
The 21st edition of the Deloitte Football Money League will be released in January 2018, profiling the top 20 clubs in the world, ranked by the revenues they generate. In June 2017 the 26th edition of the Annual Review of Football Finance was released. The publication provides analysis of the commercial development of the game and insights into future trends, and provides an unparalleled level of financial analysis into the finances of football clubs.
To find out more about the Sports Business Group at Deloitte LLP (United Kingdom) please visit www.deloitte.co.uk/sportsbusinessgroup.
Also in Japan, we hope to further improve the performance of footballers and facilitate the sports business by casting a spotlight on the area more than ever. To this end, we will release the “J-League Management Cup” report covering all J-League club teams.
We expect the “J-League Management Cup” will help to draw more attention to the sports business with great potential, and provide an opportunity for various players to enter into the sports business market. If the total amount of funds of the industry increases through the reaffirmation of the importance of BM and the vitalization of the sports business market, funds will be created to enhance FM.
Rather than simply following the preceding cases in Europe, we should devise management methods that match the Japanese culture and climate to create a virtuous cycle in which the growth of the sports business generates the growth of the sports. We believe this is the most important thing.
- Key Performance Indicators (KPI) created by Deloitte Tohmatsu Financial Advisory LLC will be set for each stage of marketing, management efficiency, management strategy and financial conditions. KPIs for the four aspects are as described below:
- Marketing: Average Attendance, Stadium Capacity Utilization(%), New Attendees/Total Attendance(%), and Average Spend
- Management efficiency: Field Wage Costs/Points Won, and Matchday Revenue/Points Won
- Management strategy: Field Wage Costs/Revenue, and Matchday and other Revenue/SG&A, Profits from Merchandise sales
- Financial condition: Revenue, Revenue Growth Rate, and Equity RatioFinancial condition: Revenue, sales growth rate, and capital adequacy ratio
- Based on the above KPIs, points will be given according to ranking in each division (the top-ranking team in the J-League Division 1 will be given 18 points, the top-ranking team in the J-League Division 2 will be given 22 points, and the top-ranking team in the J-League Division 3 will be given 12 points. In each division, if the ranking is lowered by one notch, one point will be deducted.)
- Final ranking is decided based on the accumulated points of four stages.
- If BM points are equal, teams having higher points in marketing will be ranked higher, followed by management efficiency, management strategy and financial conditions
- As the disclosed information from J-League has been partially elaborated since this year, we newly added “Profit from merchandize sales” as KPI.
Full text of the survey report [PDF]
The full text of the J-League Management Cup 2016 can be downloaded from here.
Data Book [PDF]
The “J-League Management Cup 2016 Data Book,” which summarizes financial conditions, home game data, KPIs, and standings for each club team, can be downloaded from here.
Deloitte Tohmatsu Group’s Sports Business
The Deloitte Tohmatsu Group has professionals in a wide range of areas such as finance/accounting, strategy, marketing, and business reforms. We have an established structure to provide full business support while making use of abundant knowledge in the sports business area on a global scale. In addition to consulting business, we actively make contribution to the overall sports industry through contributing articles to sports-related media outlets at home and abroad, among other activities.