Nine Scottish clubs showing signs of financial distress, survey warns

There has been a 50 per cent rise in Scottish clubs showing signs of financial distress, according to a new report.

20 per cent of Scottish clubs are showing financial distress, according to business recovery specialist Begbies Traynor.

The latest Football Distress Survey, conducted by business recovery specialists Begbies Traynor in October, shows that nine clubs in Scotland are facing financial difficulty – an increase of three from March earlier this year.

The Scottish Championship saw the highest levels of distress with four clubs showing signs of hardship compared with none eight months ago.

The findings have raised concerns that clubs are taking more financial risks to get promoted, or to avoid relegation from the top tier of Scottish football with the cost of living crisis set to 'further raise overheads and hinder revenues'.

Ken Pattullo, who who leads Begbies Traynor in Scotland, said: "The financial prize of the Scottish Premiership gates and TV deals, which although only a fraction of those in the Premier League, do still dwarf the revenues of the lower Scottish divisions.

"Historically Scottish clubs have in recent years been better at managing finances than English ones, but there is evidence that the uplift in revenues that comes with the Scottish Premiership is starting to tempt clubs to spend more on the pitch in an attempt to secure these bigger revenue streams.

“The introduction of Covid relief measures and the enterprising good management of clubs saw distress levels here hit an all-time low in March this year, but the benefits of these measures now seem to be behind us and clubs are seeing increasing pressure on finances just as fans face a looming cost of living crisis.”

He added: “Clubs are looking ahead to long winter nights with high power and fuel costs, right at the point when fans’ own domestic bills are rocketing and forcing them to make tough choices as the cost of living squeezes discretionary spend.

“Even season ticket holders will have to think twice about travel costs, parking and food and drink spending, but it’s inevitable that families facing rising inflation in every aspect of their household budgets will impact the sale of match day tickets to travelling and non-season ticket fans this winter,” added Mr Pattullo.