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The law of life and death for professional football clubs in China

The law of life and death for professional football clubs in China

On March 29, the Chinese Football Association finally announced the 2023 season of professional league club access list.

Guangzhou City (formerly R&F) and Hebei teams, which were still working in the Chinese Super League last season, failed to pass the qualification review, and their dissolution will become the final destination. Another suffocating winner is last season's China League One champions Kunshan FC, which was due to be promoted to this season's Chinese Super League and was not allowed to enter. In the 2023 season of the Chinese Super League, only 16 teams have been confirmed.

As the most representative club of Chinese football in the past 10 years, Guangzhou Evergrande (Guangzhou team) has won 8 league championships and 2 AFC Champions League championships, invited world famous coaches such as Lippi, Scolari and Cannavaro, and introduced big-name foreign aid such as Paulinho, Gaulart, Conca, Talisca and Gilardino. However, with the financial situation of Evergrande Group not satisfactory, although the club was not dissolved, it was relegated to the Central League last year.

Since investing in football in 2010, Evergrande Group has taken "saving Chinese football" as its own mission. In 12 years, after a cycle passed, Evergrande was relegated, and instead of being saved, Chinese football fell deeper into the bottom.

Over the past 10 years, the number of dissolved Chinese professional football clubs is so small that it is difficult to use specific figures, and the same drama has been played out before almost every season, especially in the last three years.

The fate of these dissolved or soon-to-be-dissolved football clubs is almost the same - the investment companies behind them run out of money, and the football clubs that "only spend and do not earn" are removed like tumors.

Throughout the development history of China's professional football league in the past 30 years, most clubs are in a non-benign and irrational state of existence, which has its own unique laws of life and death, year after year, generation after generation, thundering outside the normal trajectory of professional football development.

The law of life and death for professional football clubs in China

▲ Last season, he also played for Guangzhou City FC in the Chinese Super League.

The prototype of a professional football club

In the early years, the prototype of China's professional football clubs was basically the teams of provinces and cities participating in the National Games. These players come from the youth training system of various provinces and cities, and they began to form teams at the age of 14 or 15. If the age group of the National Games football competition is set to U16 and U20, a group of players can play two consecutive games.

In preparation for the National Games, many local football associations registered teams as clubs, and then sought sponsorship from local companies to apply for participation in the lowest level of the Chinese Champions League (before 2018, it was the China Second League). In this way, while the team prepares for more games during the National Games, it also pins on the professional football dreams of some people.

After the National Games, that is, after this group of players turned 20, they came to the crossroads of fate with the team. With continued corporate sponsorship, the team can survive and continue to play in professional leagues. Otherwise, in the absence of a game mission, it can only be automatically disbanded, and the players find their own way out, some to play football in other clubs, some to go to school, and some to enter society.

Sichuan Lidashi and Sichuan Annapurna, which were dissolved a few years ago, are basically this model. Their roots were the Sichuan National Games team, which was later retained through local corporate sponsorship, and then disbanded due to lack of funds.

When Lazy Bear Sports communicated with former national football captain Dewey last year, he told this story: Before he was 20 years old, he played for the Shanghai Cable 02 team, first playing in the second division and then the National Games. After the National Games, the team aimed to rush to the A-B League, but it was unsuccessful, the sponsor stopped investing, and the team was disbanded.

Because of his outstanding ability, Dewey was selected by the head coach of the national team, Milu Xiang, recruited "amateur players" into the national team, and brought them to the World Cup in Korea and Japan, which became a good story in the era of Chinese football.

The law of life and death for professional football clubs in China

▲Young players on the field of the National Games.

With the continuous development of the professionalization of Chinese football, in recent years, it has gradually moved away from the model of forming clubs based on the National Games team. Many clubs have cultivated a group of talents through their own youth training, upgraded step by step from the bottom, and finally achieved the goal of entering the professional league.

However, during the National Games, the outstanding players of these clubs will be transferred to provincial and municipal teams to participate. For example, in May 2011, Guangdong Football Sports Center signed a cooperation agreement with Minmetals Construction Co., Ltd., which invested 1 million yuan to title the Guangdong men's youth team. The Guangdong youth team is from the 1993-94 age group and participated in the 11th National Games in 2009, finishing fourth. The team participated in the China Second League in 2011 and prepared for the 2013 National Games.

The players of the team belong to Guangzhou Evergrande, Guangzhou R&F, Shandong Luneng , Guangdong Rizhiquan, Meixian Hakka and other clubs, and the more well-known ones are Liu Binbin, Chang Feiya, Liao Junjian, Fang Jingqi, Yang Ultrasound and so on. After the National Games, the team is automatically disbanded and players are required to return to their previous clubs according to their contracts.

The purpose and original intention of investing in football

Whether it is the "National Games team that has not been disbanded" or the football club that has worked hard from the bottom, they must have enough financial support after entering the professional league.

For example, the disbanded Hebei team, its predecessor was the Hebei Provincial National Games Team, which began to play in the second division in 2011, and rushed to the China League three years later, and received investment from Hebei Central Base Industry Group.

At the time, in the golden era of Chinese football, the group could not invest stably for a long time, and the club was on the verge of relegation after months of salary arrears in 2014. At the beginning of 2015, Hebei Huaxia Happiness Group acquired the club. This team from Shijiazhuang, Hebei Province, made waves in Chinese football due to the crazy money throwing at Huaxia Happiness Group in the initial stage.

All clubs face the same problem when they enter the professional league, as the league level increases, the players who initially played can no longer meet the needs of greater development, and the club needs to change blood, and every time they move up, they have to buy a new batch of players. After Huaxia Happiness Club rushed from the Chinese League One to the Chinese Super League, the lineup last season was almost completely changed, and a large number of original players left the team. The same thing happened to the Guangzhou Evergrande team.

In the era of Jinyuan football, there is the temptation of high salary, and there is also the possibility of being laid off at any time due to "insufficient ability".

In the 30 years of development of the Chinese professional football league, the equity of clubs is basically a single structure. Only one parent company invests, and their rise and fall determines the survival of the club.

The law of life and death for professional football clubs in China

▲ Zahavi, a former foreign aid from Guangzhou City, once won the top scorer of the Chinese Super League.

After R&F Group joined Guangzhou City Club in 2011, it invited big-name foreign aid and foreign coaches such as Zahavi and Stojkovic to qualify for the AFC Champions League, but after 12 years of investment, it was difficult to escape the fate of dissolution. R&F Group basically abandoned the club last season, and the team completed the league task under the joint funding of GAC Group, Yuexiu Group and Guangzhou City Investment Group.

When Guangzhou Evergrande Group continued to invest in football, the team won the AFC Champions League twice. After the crisis of Evergrande Group, the team immediately declined, and international players left the team one after another, quickly relegating from the Chinese Super League to the Chinese League One. During this period, there were many rumors of the dissolution of the Guangzhou team, and the team did not officially concentrate until this week to prepare for the new season of the China League One. To make matters worse, clubs such as Shide , Quan Jian and Qian Bao were arrested for illegal acts by the heads of the investment group, and the clubs did not last long before announcing their dissolution.

It is undeniable that many companies invest in football with respect and love for the project. However, some companies invest in football for less pure purposes, hoping to bring the relationship between enterprises and local governments closer through investment, so as to obtain more benefits beyond football. Once these "interests" are not met, the enthusiasm to invest in football drops to freezing point.

A local football association president said in an exchange with Lazy Bear Sports at the end of last year that when he communicated with the head of a Chinese League One club, the other party expressed his hope to help coordinate a piece of land for football youth training projects. The president of the local football association said that "free is impossible, you can only spend money to rent". The club had been contemplating leaving its current location, but was unable to do so due to the prohibition of the transfer of professional clubs by the Chinese Football Association.

A field of chicken feathers after the dissolution

There is a problem that can never be solved in professional football in China - it is impossible to make ends meet, and some clubs that spend crazy money earn less than 1/100 of what they invest. Even if those small clubs want to break even, it is unrealistic.

The means of earning money for professional football clubs in China mainly include player transfers, sponsors, match tickets, club peripheral products and league dividends. The Chinese Super League pays about 60 million yuan a year at its most, but the China League A and China B have almost no dividends.

Except for big cities such as Beijing, Shanghai and Guangzhou, which have decent income in the development of tickets, sponsors, and peripheral product development, other small and medium-sized clubs basically do not make money on this. Some clubs have been able to sign sponsors with the help of local governments and sports authorities, but this can only solve a temporary need, not a long-term solution.

Some small and medium-sized clubs can earn a relatively large transfer fee by selling players, and use this money to maintain the club's operation, which is also a survival model of professional football. But China's transfer market is not sound, and Lazy Bear Sports has heard stories of a Chinese Super League club selling two players from another Chinese Super League club, and the transfer fee is paid in installments. Later, some transfer fees were not honored for two years, and the bosses of the two clubs even cursed each other on WeChat for the matter.

In the past three years of repeated epidemics, the Chinese Super League has implemented a conference system, and the club's income from tickets, sponsors, and club peripheral products can be ignored, and the dividend at the end of the year has dropped from 60 million yuan at the maximum to 10 million in the 2021 season and 8 million in the 2022 season.

The law of life and death for professional football clubs in China

▲Hebei and Wuhan, who also played together in the Chinese Super League last year.

Operating such a money-losing transaction, the investment company is not a big problem when the economy is good, and it can even rely on throwing money in exchange for a few championships. Once the investment company is in poor economic condition, it will collapse. The dissolution of Jiangsu Suning after winning the Chinese Super League championship has had a great negative impact on the image of Chinese football.

At the end of the 2022 season, Wuhan Yangtze River Club announced its dissolution, and investor Zall Group promised to distribute the previously arrears of wages to players and coaches. In the context of most professional football clubs "announcing their dissolution to absorb debt", the normal operation of Wuhan Yangtze River Club has become a scarce quality of Chinese football.

Chinese professional football clubs are all independent registered limited liability companies separated from the investor, legally speaking, after the club announces its dissolution, the player's salary target can only be this "independently registered limited liability company". The announcement of the club's dissolution also means that it will not continue to register with the Chinese Football Association, which no longer accepts disputes with the club.

When the Liaozu club was dissolved in 2020, it owed a total of 38.66 million yuan in salary bonuses to players, and the players went to the provincial sports bureau to pull banners in order to ask for wages, but they could not solve the problem. They later chose labor arbitration and won the case, but they could not get the money because the club had no money on its books and no physical assets - the office space and training base were rented, and the value of the remaining office supplies was negligible. This situation is common in Chinese football, and many salaried players end up discovering that the club's only asset is a bus.

After the dissolution of the club, players do not get money, and it has become the norm in Chinese football. What is even more sad is that instead of becoming a shame, it has been used by some football club managers as a means of blackmailing players. Every year, when reviewing the access materials, the Chinese Football Association will require the club to submit a confirmation form signed by the players and coaches that "the salary bonus of the previous year has been paid in full". Individual club managers who don't pay will say to players who don't want to sign: "The consequence of not signing is the dissolution of the club." Once the club is dissolved, none of you want to get the money. ”

Tear it down and start over

Over the past 10 years, it is impossible to calculate the exact number of teams dissolved in China's fourth-tier professional leagues. Before the dissolution, investment companies also thought about transferring, but there were not many successful cases, especially in recent years.

The reason why companies are reluctant to take over football is on the one hand because of the current poor image of Chinese football, secondly, because professional football clubs invest too much and return too low, and another important reason is the club's debt and disputes.

Tianjin Tianhai (Tianjin Quanjian) Club proposed "zero transfer" before its dissolution in 2020, but it has 1 billion yuan of debt, which needs to be borne by the receiver, which many companies are discouraged. The debts of the Tianhai Club at that time were on the surface, while some of the debts and disputes when the clubs were dissolved were hidden. If you can't completely sort it out when you take over, the consequences will be endless.

In addition, investors such as Shide Club, Quan Jian, and Qianbao Club were arrested for crimes, and the reputation of the club was affected, and no company was willing to take over.

Businesses willing to engage in soccer would rather start from scratch and start in the lowest leagues than buy a shell of a higher league that may have hidden debts or a bad reputation.

This year, for example, after Hebei withdrew from the professional league, Langfang will re-form a new team, which is dominated by young players, starting from the lowest level of the Chinese Champions League, one of which is from Hebei's youth echelon. After the dissolution of the Guangzhou City Club, the GAC Group, which had intended to acquire the club, adopted the same model.

The law of life and death for professional football clubs in China

▲Guangzhou Evergrande received a lot of support from fans when its results were good.

This way of operation is not new in Chinese football. In May 2022, Chongqing Liangjiang Athletic Club was dissolved, and Chongqing Football transferred the center to Chongqing Tongliang Long Club, which was formed at the end of 2021, which won the silver medal of the 14th National Games Chongqing U18 National Games team (03 age group) as the team, and also introduced the echelon players of Beijing Renhe Club who were disbanded in 2021.

It is again based on the National Games team, starting from the lower leagues, and the familiar path: establishing a club, finding investors, changing blood, upgrading step by step, and gaining a foothold in the top league.

This is a survival rule of Chinese professional football clubs deduced without problems.

If one of these links goes wrong, it is at risk of dissolution. Even if it does reach the step of "gaining a foothold in the top league", it may collapse at any time due to financial problems, just like the Hebei and Guangzhou City clubs that did not qualify for registration today. They went from "success" to failure for almost the same reasons - there was a problem with the investment enterprise, the football club became a burden, and it was abandoned in the first place.

Professional football is a consumer product that is supposed to bring more joy, but it often makes it extremely heavy and untold in our case. The fragile Chinese professional football is like a dangerous house in disrepair, which may be overwhelmed at any time and overturned. Under such a reciprocating cycle, where is the end and antidote?

Disclaimer: This article is original by Lazy Bear Sports and may not be reproduced without authorization.

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