Why Are So Many Clubs Going Bankrupt?

Many Clubs Going Bankrupt

After years of relative stability the Football Federation of Cambodia (FFC) ushered in the Cambodian Premier League (CPL) in order to improve the national game prior to the hosting of the SEA Games.

To say that things have not exactly gone to plan would be doing a great disservice. Cambodia were frankly awful during the football tournament, despite being on home turf and clubs have quite literally being folding every few weeks. Why though has this happened and what can be done to address the problem?

Cambodian football prior to the CPL

Cambodia like other Communist states initially had a algae dominated by state run entities, vestiges of which can be seen through clubs such as Taffy Army, National Police and the now defunct EDC FC.

You can read about EDC FC here

In the early days Ministry of Commerce were the most successful team being currently the only club to have won the league 3 years in a row (1982-84).

From 1993 semi-professional private clubs started to join in, before a full blown semi-professional competition namely the C-League was introduced in 2005.

You can read a full history of Cambodian Football here

The C-League

The C-League was to prove the great game changer in Cambodian football, with the current “big  clubs” mostly being formed during this period. And while the first two titles were won by the now defunct Khemera, all other successful clubs are still in operation.

There was also a large amount of stability with only one club that participated in 2018, namely Western Phnom Penh dropping out of the league during this time period.

Fast forward to 2023 and a whopping 6 teams have folded in less than 6 months. So, why has this happened when the league is supposedly in such good shape?

Who has gone bust and why?

Of the 6 now defunct clubs, namely Asia Euro United, Banteay Meanchey, EDC FC, Koh Kong, Soltilo Angkor FC, and Tboung Khmum there have been a multitude of reasons why the clubs have folded, or dropped out of the league. For all intents and purposes though it can be summed up as lack of money and support.

Koh Kong for example should have been poster boys for the CPL and their “a team in every province” mantra, yet despite investing heavily and finishing 3rd in CPL 2 they were snubbed for promotion. They have since been invited to numerous CPL 2 meetings, but have simply snubbed back.

For other clubs such as EDC FC and Asia Euro United the situation is even more farcical. Both have encountered problems related to sponsorship, as well as an overtly strict interpretation of club licensing. Yes in the long term it makes sense to have strong licensing rules, but should things like floodlights and improved refereeing not be given priority? Regardless two long standing and popular clubs have decided it is not worth taking part in a division that even if they won it will not allow them a return to the top tier.

Where is the money?

Prior to the CPL MetFone gave an estimated $500,000 per year in sponsorship, an amount Satoshi and the CPL said they would raise to $3 million. Alas this has not happened and sponsors such as Panasonic largely give stock rather than cash.

To read about the $3 million that was supposed to be raised click here.

This has meant that competitions such as the League Cup have not even offered clubs a participation fee. This meant a huge loss of money for clubs in 2022 and only 14 taking part in the 2023 edition. Essentially clubs could not afford to be part of it.

Yet despite there being no sponsorship money, although the FFC still receives more than $5 million per year from footballs world governing body FIFA. What many are now asking is where is that money going and could some of it not go back into the league?

How expensive is it to run a football club?

Quite simply much more than. The income provided by the CPL. In CPL 2 during 2022 home sides received $550 per match, while away sides received $650. These figures were woefully inadequate with clubs estimating that an away fixture in another province, such as Siem Reap was costing around $2000.

Clubs were often not that much better off if they ere playing at home, with security, renting of pitch and various other expenses meaning that even home matches were not earners.

Whether we like it or not clubs quite simply cannot rely on gate receipts and shirt sales to run a professional club. Yes clubs are being “encouraged” to build their own stadiums, but currently it is an oligarch league, with clubs only having any chance of success if they have rich benefactors.

To read about Angkor Tiger almost going broke click here.

How can we stop clubs going bankrupt?

Despite seemingly an unanswerable question the answer is actually very simple and this provide clubs with more money.Fees for home games need to be at least doubled, whilst away matches need to paid based on milage.

The fact that Asia Euro United playing EDC FC in 2022 would have earned the same fee as Siem Reap going all the way to Koh Kong is frankly ridiculous. The CPL need to stop treating the second-tier an afterthought with a one size fits all mentality.

And while some might argue that the FFC bailing out the league is not good business I would counter that the money gotten from FIFA is to promote grassroots football, and that is exactly what the CPL 2 is…

This article is adapted from BPVE, (https://bpve.com/) reported and edited from the great team – Cambodia Sports Review. (https://www.cambodiasportsreview.com/)
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