COG Update – 4th March 2014

COGlogoSince the Killie (Community) Working Party lodged its Letter of Intent with Michael Johnston, Chairman of Kilmarnock FC, we at The Killie Trust have been working hard behind the scenes to ensure that the proposition is given due consideration by the club and is understood by the wider community. It is encouraging that all parties we speak to directly both understand the concept and agree that the working party are right to actively seek meaningful community involvement in the club and that community ownership should be the desired position on Mr Johnston’s exit from the club.

Whilst communication with the club has been disappointing to date, we have engaged with the local MP, MSP and council leader, all of whom have agreed to encourage Kilmarnock FC to meet either the working party or Killie Trust, as representatives of that group. An excerpt of a recent e-mail to the politicians follows. This helps to explain the views of the working party which resulted in the Letter of Intent being issued and why the Killie Trust is committed to taking this forward.

Many thanks for your help over the last few weeks with the Killie (Community) Working Party and also taking the time to learn a bit more about the Killie Trust. I am aware that you were all going to suggest to Michael Johnston that he meet with the working party to enable us to explain our Letter of Intent more fully. Despite this, and his comments in last week’s Standard that Michael would welcome a meeting, there has been no communication from the club. Indeed, Billy Bowie had indicated he would be in touch w/c 17th to arrange a meeting with me, and despite chasing this up, I have had no further communication from him either. I also note that there has been no formal response to the Letter of Intent.

You will appreciate that  it is extremely difficult to try to build any meaningful working relationship with an organisation who cannot communicate effectively. You will  recall that we mentioned the Trust has had an unsigned NDA sitting with the club for the best part of a year after Michael requested this. Sadly, the club do not appear to want to engage with either the working party or the Trust. As you know, the Trust is the second largest shareholder in the club and is a properly constituted community driven organisation with circa 400 members.The working party the Trust is represented on is keen to move down the road of meaningful community involvement with the goal of ultimate community ownership.The club has mentioned publicly its desire for community involvement yet does not even want to discuss this vision with these bodies, both of whom could certainly offer constructive guidance and support.

My only conclusion is that the Community Involvement Board the club is planning is their preferred vehicle for community involvement. I imagine that this is in the hope of satisfying the club’s bankers in negotiations during a review of their debt. I assume this board will not be endorsed by the Scottish Government as it does not, as far as I  understand, meet the co-operative values of one person/one vote. I believe this is why  Paul Goodwin of Supporters Direct cannot back the idea as it stands. I am intrigued as to how any lender will afford debt forgiveness to a window dressing style of community involvement in a private limited company with one major (80%+) shareholder. However, I genuinely hope a suitable deal can be done to ensure the survival of the club.The bank’s stakeholders and many SMEs in Scotland may have their own opinion on that though.

As you know, the purpose of the Letter of Intent was to seek a route to ensure that, on Michael’s exit from the club, the fans and community are given the opportunity to own the majority stake in the club. It was neither a formal bid for the club nor a suggestion that the club be passed to the fans for no financial consideration. We would be dismayed if the club ended up in the hands on an individual or group who had no real understanding of the importance of the organisation to the community and who might, as we have seen elsewhere, use the club for their own purposes thus creating a greater divide than we see presently. I suppose the greater fear is that Kilmarnock FC then slips into an insolvency event as that type of owner has no passion or true vision for the club and community.”

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Response to Michael Johnston’s Recent Statement

In response to comments made by KFC Chairman Michael Johnston in todays Daily Record Gary Torbett had this to say on behalf of The Killie (Community) Working Party:

“Further to the announcement by The Killie (Community) Working Party [on the 11th of February 2014] of its intention to offer to purchase the shareholding of Michael Johnston, Chairman of Kilmarnock Football Club, in the event that the club were to become debt free, we are extremely disappointed that Mr Johnston has so swiftly and publicly dismissed our intentions.

“It is disappointing that this proposal has been dismissed so early into the process without any constructive dialogue with Mr Johnston. Mr Johnston has offered our group the opportunity to buy a seat on the board should it purchase circa 10% of the unallocated shares in the football club. It would not be appropriate for this particular group to purchase a tranche of shares at this time to obtain a seat on the board of Kilmarnock FC, given our stated purpose.

“The group would welcome, indeed we would urge for, the opportunity to meet with the football club to establish a mutually agreeable route to genuine community ownership, which has the club’s long term future in mind.

“Our doors remain firmly open to Mr Johnston.”

Supporters Direct Scotland has also reiterated its willingness to work with both parties.

COG Working Party Press Release – 11th February 2014

KILMARNOCK FC SUPPORTERS GROUP MAKE OFFER TO PURCHASE THEIR CLUB

The Killie (Community) Working Party, established with support from  Supporters Direct Scotland, has announced its intention to make an offer  to purchase Kilmarnock FC’s Chairman’s entire shareholding.

garybioGary  Torbett, on behalf of The Killie (Community) Working Party, said: “We  would like to acknowledge the work being undertaken by the Chairman of  Kilmarnock Football Club to make the club debt free and would positively  encourage him to make every effort to come to an agreement with the  club bankers and other significant lenders to reduce the debt to zero.   The Killie (Community) Working Party would like to make an offer to  purchase the Chairman’s entire shareholding if this can be achieved.”

“This  offer would be contingent on a fair valuation of the company and the  completion of a satisfactory due diligence process.  This purchase would  be undertaken by a new Community Interest Company (CIC) with a  democratically elected board.”

Scottish-FansPaul Goodwin, Head of Supporters  Direct Scotland said, “I met with Michael Johnston, on behalf of The  Killie (Community) Working Party, on Friday [7th February] and conveyed  the outline of the supporters’ offer.  I reiterated SDS’ willingness to  assist in progressing this offer to a satisfactory conclusion for both  parties.”

Gary Torbett added: “We see this move as a genuine step forward as we prepare to get our club back.

Unfortunately  there remains concern amongst supporters with the long term position of  the club and we firmly believe that fan and community ownership is  where that lies rather than relying on a single majority shareholder who  won’t be around for ever.  The only constants at any club are the fans  and the community it is based in.”

“We will shortly launch our formal efforts to raise the money to take  the club into community ownership and we hope that the business  community – both private and public – as well as community groups and  supporters will get behind us.”

Kilmarnock fans have a history of successful fundraising and  community involvement. Over £100,000 has been directly raised for the  Club’s youth development programme and a number of initiatives driven by  The Killie Trust have seen financial awards to a many community based  projects in recent years.

The Killie (Community) Working Party is made up, in no particular order, of:

  • The Killie Trust
  • The Kilmarnock FC Supporters Association
  • Minority shareholders in Kilmarnock FC
  • The Business Club
  • Young Kilmarnock

Issued on behalf of The Killie (Community) Working Party by Supporters Direct Scotland.

For further information please contact Paul Goodwin on 07702 252519 or Gary Torbett  on 07905 478179

Its Good To Talk

Last week during discussions with the KFCSA committee, we suggested that it would be a good idea to invite Paul Goodwin (Head of Supporters’ Direct Scotland) along to their open meeting on our behalf due to his experience in dealing with clubs with problems like ours and his expertise in governance and community ownership; along with our own board member Andy Millar who obviously has a better handle on things from our perspective. Mr Goodwin graciously agreed to give his time, despite the fact it wasn’t primarily a Trust meeting, as part of his remit with SDS is to help out wherever possible when clubs are deemed to be in trouble.

Mr Goodwin has subsequently received a request from Michael Johnston, Chairman of Kilmarnock FC, to meet with himself and new director William Bowie on the proviso that the talks would take place prior to the KFCSA open meeting on Thursday. The invitation was extended to a couple of representatives from both the Trust and the KFCSA, but unfortunately it has been arranged at too short notice for that to happen in the time frame requested. We have offered to meet with the club directors at the earliest possible convenience for all parties and hope that a reply to our legal representatives and the verification of our recent share acquisition is on the agenda.

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The Wisdom of Crowds Part Three

Buy a brick at Rugby Park

Having attended the Supporters Summit 2013 at the English Football Associations new centre of excellence at St Georges Park, which was hosted by Supporters Direct and the Football Supporters Federation. This event was attended by supporters from across all Europe. These supporters came from a wide range of clubs in a variety of situations. Some are simply trying to keep their club alive despite the best efforts of business minded people, others have lost that battle and have started their own phoenix club based on democratic community ownership principles. The Trusts from many of EPL clubs are working to keep their club grounded in their community with a local sense of identity and history.

The very next weekend we met up with an equally diverse group of Scottish football supporters at the Supporters Direct Scotland Club Ownership Summit at Stirling Albion. Here we met supporters who already own their football club or in a very good position to take control of the destiny of their club or believe that community ownership is the only sustainable future for their club.

So what have learned from meeting all these football supporters?

The position of our football club and the deteriorating relationship between He that “runs it” and its supporters is almost the default position for football clubs today. The single person ownership model is more prevalent than at any other time. A lot of football clubs are run with a cavalier disregard for the fundamentals of economics, business planning, marketing, social responsibility and sound financial planning. Sadly this includes our own club. Most of the clubs that make use of these basic business tools are clubs where fans have a strong voice or they are the outright owners.

Clubs that become community owned know that their most important asset is the supporters because without them there is nothing. A good relationship must be built and maintained with them to ensure sustainability off the pitch which ultimately helps to bring success on the pitch. At the Supporters Summit 2013 Tim Connelly the Vice President of Sales for the Green Bay Packers, the only community owned club in the NFL, said “if our customers are angry with us we have missed the point”. He also observed that Green Bay are in the subscription business “we want people to keep coming back and signing up for longer, to do that we have to give them something they want, they have to have a sense of community with the club”.

Back in Kilmarnock however, our Chairman seems unwilling to engage with the local community. Our attendances are dwindling, a 16% reduction in home attendances last season alone1. The average age of Killie supporters is rising so we are facing a demographic time bomb. We are a club that is in danger of literally dying out in the next 50 years unless we start trying to reverse this trend now. There is no vision or plan to reverse this trend coming from the boardroom. The local community is the biggest and most likely source of new supporters for us. As a football club our very existence depends on developing a long term and comprehensive strategy to bring in new supporters. This means Killie have to be at the very heart of the community.

The Trust has developed a number of projects that promote education, health and well-being in our community that also raise awareness of Kilmarnock Football Club. These projects have all been designed to be sustainable over a long period of time which is vital if the club is to start growing its support again. We realised from the start that we had to use the minimum amount of club resources as these are in very short supply. The K-Steps programme is just one of these projects. We have several others at an advanced stage of readiness, but they have been sitting on the shelf for over 18 months. The key element to going forward with these projects is the engagement of the club. The Trust has made several attempts to engage with Mr Johnston on the subjects of community development, the use of volunteers and community ownership. These were generally rebuffed and those that did move forward took so long to do so that the opportunity was lost or the conditions for club involvement were such that the board of the Killie Trust would have been at risk of breaking its own operating rules.

So where do we go from here? People say that community ownership cannot work at big clubs but the Champion’s League final this year laid that myth to rest once and for all. We, as a community, need to take the destiny of our football club into our own hands.  There are great examples of community ownership across the UK.

There is no quick, easy answer to the difficulties our club faces, but the current chairman has no plan to take our club forwards and is unwilling to accept any support other than cash. Our Football Club should be doing great things in our community right now. Things that would start to reverse the inevitable decline we are in right now. However, short-termism is the order of the day for the Chairman and one man board of Kilmarnock Football Club.

There is no white knight waiting in the wings and anyone that claims to be a white knight needs to answer some very serious questions about their plans.  People keep on asking “where is the alternative”. WE, the supporters of Kilmarnock Football Club, founded in 1869, are the alternative. Fans are always the bank of last resort. When everything has been run into the ground and every line of credit fails and the gates are about to be locked forever, the fans pull together. They find a way to put aside their differences and take that step into the unknown and take control of the football club they love.

It is happening right now at Dunfermline. Pars UNITED have been named the preferred bidder. The only other bidder decided to remain anonymous and this lack of transparency appears to have affected their chances.

It is happening right now at Hearts. The Foundation of Hearts has put in a very strong bid for the club and we will know soon if it has succeeded.

Are Hearts or Dunfermline fans any smarter than Killie fans? No. The only reason we will fail is because we fail ourselves.

What can we do?

Reference

1. Kilmarnock Standard 12.07.2013, page 103, John Livingston.

The Wisdom of Crowds Part Two

DSC_0195Supporters Direct Scotland (SDS) held a one day summit for Scottish Trusts on fan ownership on the 29th of July 2013 at Stirling Albion football stadium.

This event was attended by Elaine Millar, Barry Richmond and Andy Millar from the Killie Trust board. This was an opportunity for supporters to discuss common issues and to share experiences on a number of subjects.

The Stirling Albion story

First we had a presentation on Stirling Albion’s move into community ownership. This change of ownership took place in order to prevent the heavily in debt club going into administration. The debt stood at £1.3 million with no real plan to reduce this figure.  A situation very similar to the one at Killie but on a slightly smaller scale. The long term strategy for Stirling Albion was to deal with the debt and have a sustainable football club.

The Dundee story

The story of Dundee’s various administration events and dubious owners is well documented. The crucial part of the story is how much more difficult the purchase of the club was while in administration. The time scales for taking action can be very short indeed.

The Clyde story

Finally we told about the day to day operations of Clyde FC which is a Community Interest Company (CIC). This included the work and democratic process that has been undertaken around the proposed move to East Kilbride. Clyde have been working with in a sustainable budget since they became a CIC as the rules that cover CICs do allow them to work any other way.

DSC_0192We then took part in workshops about two different subject themes.

  • In which areas could community clubs work together to reduce overheads and increase income.
  • What governmental and governing bodies legislative changes could be made to benefit clubs moving toward or in community ownership.

Finally we had an opportunity to update the other attendees about what was happening at our respective clubs and trusts.

It was very interesting to hear what has been happening at other Trusts in Scotland, and in particular to hear from Clubs that are now in community ownership.

We came away with a lot of very good ideas that we will be adapting for our use and a lot of good contacts. There is no reason that football clubs cannot help and support each other off the pitch and still compete on it. If all scottish football fans work together we can start to improve that situation our game is in for everyone and community owned clubs are leading the way.

For more details visit the Scottish fans page about the summit.

The Wisdom of Crowds Part One

st georges park cropped

Supporters Direct and the Football Supporters Federation held their first Supporters’ Summit at the English FA’s new Centre of Excellence, St George’s Park near Burton upon Trent on the 22nd of June.

Two volunteers from the Killie Trust made time to attend the summit on behalf of the board. Events like this are very interesting and well worthwhile attending. The speakers were very informative and the workshops were very relevant. The best thing about the trip to Burton upon Trent was the opportunity to meet supporters from other football clubs and Trusts from across the UK and Europe. The most striking thing about speaking to other supporters is how much we have in common. Our situation is not unique. This is very unfortunate for the health of football but is fortunate for us as supporters, as it provides us with a wealth of experience and knowledge to draw on in our efforts to bring our club into community ownership in a sustainable way that is valued by everyone in our community.

The format of the day was fairly straight forward. During the opening session we heard from the Andy Burnham MP and David Bernstein the Chairman of the English FA. Andy Burnham was instrumental in getting Supporters Direct established back in 2000. David Bernstein was the chairman of Manchester City FC but he still sees himself as a fan first.

The rest of the day was split into workshops so our intrepid volunteers spilt up in order to cover as much ground as possible, gather as much information and hear the views of as many people as they could. The workshops they went to were as follows (for more details please check out the Supporters direct page about the summit.):

Sustainability or Bust. This workshop covered how community owned football clubs must to have a sustainable business model and how this can be achieved by having a long term financial plan.

Reclaim our game. This gave practical guidance on how fans can get involved in their clubs and make a real difference in how it is run and ensure that good governance takes place.

Improving football governance. There are great examples from all across Europe where fans are making a real difference to how football is being run. In Sweden fans ensured the 50+1 rule was kept for all sports clubs in the country despite the wishes of a few powerful individuals.

Fan engagement: Why it works for clubs and fans. This was a fascinating presentation from Tim Connolly the Vice president of sales for the Green Bay Packers. Green bay is the only community owned club in the NFL. Tim gave some great examples of how the community ownership model really works for them. Green Bay have a waiting list for tickets but only charge the league average for their tickets. For every dollar spent at the Green Bay’s stadium $5 are spent in the teams local community.

Transparency and Vigilance. Micah Hall from Portsmouth gave an account of his search for the truth about the ownership of his club Portsmouth FC on his Hall Right Now Blog and how transparency is vital to the health of every organisation. The owners of Pompey tried to sue Micah over the content of his blog. As he said “you know you are asking the right questions when that happens”.

They also bumped in to some of the people running the Shelbourne FC Trust (The 1895 Trust) and had a chat about the good old days of Killie in Europe.

The Trust Movement in Ireland has had a great boost in recent months with the launch of the ‘Heart of the Game’ handbook. A new ‘how to’ guide for League of Ireland supporters. This handbook has received government backing and was launched at Dáil Éireann by Minister of State for Sport, Michael Ring TD. – See more at: http://heartofthegame.ie/

By all accounts it was well worth the long journey to St Georges Park. Which for the record is so new it is not on Sat Nav yet. For the purposes of full disclosure our volunteers paid for the entire trip themselves.