Southampton CEO Parsons explains how he's keeping finances in control

Parsons arrived at St Mary’s from Dyson this summer in the wake of the club’s relegation from the Premier League after an 11-year top-flight stay.

Relegation coincided with the first full season under new owners Sport Republic, who acquired a majority shareholding from Gao Jisheng in January 2021.

The Championship drop meant revenue was halved, with a huge reduction in broadcast revenue a big factor. The club now operate with one of the biggest wage budgets in the league.

During the summer transfer window, Saints sold players to the tune of around £170million – but they will only see a maximum of £45million of that this season.

Saints are also now paying off a loan borrowed from MSD Holdings worth around £80million to cover working costs in 2020, as a result of the COVID pandemic.

Parsons has been tasked with ensuring the club has a sustainable future and sat down with the Daily Echo after three months in his role to explain the process.

“Immediately, for us, we lost about 50 per cent of our revenue following relegation. For any business, that is huge,” Dyson’s former Europe, Middle East and Africa president told us.

Phil Parsons works out of his office inside St Mary's Stadium (Image: PA)

“We had to make some tough decisions on certain redundancies and roles and we have had to scale back but we have tried to support the football as much as possible.

“We’ve got a squad with actually quite ‘healthy’ wages against other squads today. The obvious question that you want to ask is about how we sold a lot of players.

“There are fees to pay and you will typically only get the money over three seasons. It doesn’t suddenly cover the drop from the Premier League, even including the parachute payments.”

Parsons added: “Jason Wilcox and Russell Martin have worked with us to say ‘How can we make sure we get a team strong enough to hopefully get promoted while being agile?’.

“It’s my job to look at both lenses. It’s their job to push the players every day but it’s my job to make sure this club has a sustainable future.”

EFL financial fair play regulations, assessments carried out yearly but calculated on the previous three years, limited the club’s spend this summer – the loan market offered a route to improve without taking on long-term liability.

Player trading was integral to balancing the books and the £53million fee received from the sale of Romeo Lavia to Chelsea is considered “crucial”. 

“There is a huge amount of asset value in the players we have bought in the last couple of years but we want them to be playing here,” Parsons insisted, though.

“It’s not something that we want to sell players, we will sell when we need to and if it’s the right money, as we proved this summer.”

Saints committed over a reported £60million to player spend in Sport Republic’s first summer, with big-money additions of Kamaldeen Sulemana and Paul Onuachu following in January.

The cash injections made by Dragan Solak, Rasmus Ankersen and Henrik Kraft’s group were the first penny put into the club since 2014 – a staggering fact.

Sport Republic lead investor Dragan Solak and Saints chairman Henrik Kraft

“They haven’t had a penny taken out of the club. The owners are happy to put money into the club because they want to win and are passionate about football,” Parsons added.

“There has been a lot of cleaning up. There’s a loan against the club which we have to manage, so we’re in control of the club finances but we will have to adapt as we go.

“This is why things like our youth system are crucial to us, we need to bring through new talent and we’ve got boys with a really bright future at the moment.

“It is tough and we’ve seen that if results don’t come immediately it can be quite challenging, but we’re confident with the players we’ve got that we can get things back on track.”

On his whiteboard in Parson's office are his key focus points – chiefly, finance and people, with the idea that the football then takes care of itself.

Parsons, who grew up on a working-class estate in south London and whose own fledgling football career ended after being let go by Woking boss Glenn Cockerill in 2003, feels the club have added character and bite to creative discussions and sought to encourage contribution.  

“I have said a few times but we have got some really good people at the club and my assessment is that we have sometimes been trying to do too much,” Parsons said.

“We have had to start making fundamental changes at the club. Importantly, regarding the culture. There has been so much work behind the scenes with how people are operating.

“We have built a season-long strategy and we have been working on what we want to do as a group. We have been largely successful in that area.”

Saints have been proactive in securing new sponsorships this summer, with the likes of Draper Tools, Mairon Freight, Blue Islands offering quick wins and potential long-term partnerships.

The club are looking to further utilise their stadium as a method of increasing revenue, while the attendances at St Mary’s continue to grow larger and get younger.

They are working on stadium improvements with the introduction of Wi-Fi expected, and are also close to making announcements on safe standing - pending fan consultation.

Parsons is looking to see improvement on the pitch, with director of football Wilcox reporting to him, but urges supporters to back the manager and his team.

Manager Russell Martin is backed despite an expectation to improve results (Image: Stuart Martin)

He said: “Nobody is hurting more than Russell. He spends a huge amount of hours trying to get things right and when it doesn’t come off, it hurts.

“Russell can only set things up and sometimes it goes wrong on the pitch. He is a very good man manager and the players are fully behind him.

“Of course, we want to see things turn around and we want to see some wins coming through. It wasn’t what we expected a few weeks ago.

“That’s football and that’s why we all love the game, why opinions matter and why fans continue to come. I ask for them to continue to get behind the team.

“We have good players in the squad and we want to see them bouncing back quickly, and we will give them the space to do that.”