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David Codey (61)
How much can the corporate costs be cut before they start having a negative impact on the game? Certainly those corporate costs and headcount have been trimmed a lot in recent years (coming from a very bloated beginning). At some point of efficiency your corporate costs are largely overheads that shouldn't really vary that much from year to year.
If the revenue goes up we shouldn't see the corporate costs go up in lock step but should see grassroots spending go up substantially because there is free cash flow available.
You can't realistically make a decision that your overheads are going to be constrained to being a fixed percentage of revenue. You obviously have to live within your means but at some point shrinking that also shrinks you ability to generate the revenue.
I didn't say that no improvements had been made in corporate expense,and wasn't suggesting that corporate costs should be pegged to a fixed percentage of income.Nor did I suggest that corporate costs should be reduced to levels where the ARU can't function.
My point was the ARU spends a higher percentage of income on corporate, and a lower percentage on grassroots than their competitors.
The biggest problem I have with the ARU is they consider grassroots to be an expense.
Whilst smart administrators consider it an investment.