LAYING THE FOUNDATION FOR A BETA TOMMOROW FOR DEMBARE(REPOST). ITS STILL RELEVANT & UNLESS SOMETHING CHANGES,DEMBARE WILL CONTINUE TO SUFFER SAME FATE IN CAF TOURNAMENTS 1)The founding fathers should invite the public for an Initial Public Offer(IPO) so that the general public can subscribe to buy shares in dynamos and become shareholder and list the club on the Zimbabwe stock exchange. With their huge following Dynamos shares will certainly be oversubscribed in a matter of hours. For example, Dynamos can issue 100 million ordinary shares at $0.50 cents per share ,they will instantly raise US$50m which can be used to buy a controlling (65%)stake in Rufaro Stadium, own a club village, build a state of the art school of excellence and own their own team buses among other things. When that happens, sponsors will scramble to have their name on the Dynamos jersey. Founding fathers should remain with 51% stake for laying the foundation for this great team. 2) The founding fathers can also raise money through selling 49% to Dynamos supporters through a membership drive. They can issue 100m shares @ $0.50 ea to 100,000 fans. Each member will own equal shares eg (1000 @ $0.50=$500).The advantage of this over the one above is that the club will be wholly owned by the fans, so the club will be in safe hands as they won`t do anything that hinders its progress. 3) Since the founding fathers are reluctant to sell. They can still make dynamos a viable by selling club merchandise like jerseys,scafs,bandanas,mugs,bedsets,flags,caps,t-shirts etc. Dynamos should patent their regalia and enter into an agreement with a kit manufacturer such as Faith Wear/Adidas/Nike etc to manufacture replica jerseys and other merchandise. In return they should agree on the share of expenses & profits.eg Dynamos can easily sell 120,000 replica jerseys/year @ $30.00=$3,600,000.00 less expenses $1000,000.00,net profit $2,6000,000.00.The two parties can then share profits on 50:50 ratio. That means dynamos will earn $1,300,000.00 from replicas+ gate receipts+ other income(prize money for winning league, any cups trophies,caf champions leagues+ other merchandises).This income will be more than enough to meet all expenses, and make a profit and more importantly it will mean dynamos can pay higher salaries, retain top players and as well as attracting others. It will allow also the club to save money for capital projects such as buying team buses, club village incorporating training ground, club offices, player cottages etc 4) Getting a bond from banks to finance buying of a training ground will be difficult for dynamos. To get a bond/loan you need collateral security tied to that bond in the event you fail to pay and the bank will recoup their money by selling your assets. You and I know a dynamos doesn’t have real tangible assets which can be accepted by banks as collateral security. The only real asset we have is the huge fans bt that is nt guaranteed that fans will come in their thousands to pack rufaro to the brim. Even that has its on flaws as many people as widely known don’t pay to watch the games+ corruption @ the gates and more importantly that 46%(including 20% city of Harare,15% vat,police,ambulance,cost of tickets,psl,ground security etc) of match day revenue goes to match day expenses, leaving very little for capital projects like buying training ground etc. Dynamos can get a bond thru the executive ie people like Mr Mubaiwa will have to put their business or houses or personal properties as collateral bt can they risk their businesses for the love of dynamos.. I don’t think so, more so with the volatile situations @ our club. Banc ABC could be the solution to getting a loan/bond to buy a our own training ground,bus or and stand for stadiums Since they are already our main sponsors, they could by the stand, club house and club bus and recoup their money thru exclusive selling regalia for a agreed period such as 5 years and dynamos will proudly own a bus,stand,club house after the expire of the contract. The bond will carry a interest of between 23-28%/annum (this is the current rate of interest from banks) per year on a reducing balance Example: Loan to dynamos to buy: Training ground & stand for stadium $2.m Club house $200,000 Club bus $100,000 Total $2.3m Add interest @ 28% for 5 years $3.2m Total including interest $5.5m Pay beck with interest repayment year $1.1 Banc abc recoup thru selling of regalia 100,000 replica jerseys per yr @ $30.each =$3m Less expenses $1,000,000 Net profit =$2m Less loan+interest paid beck $1.1m Balance of $900,000 is shared 50:50 Dynamos will get $450,000 and banc abc $450,000 per year Total income for dynamos after 5 years= $450,000 x 5=$2,250,000 Banc abc $450,000 x 5 =$ 2,250,000+$ 3,200,000 from interest =$ 5,450,000. This is a win win situation.More importantly by e end of the deal,Dembare will have some tangiable assets they can call their own. THIS IS JUST A ROUGH GUIDE.
Posted on: Fri, 14 Mar 2014 08:07:09 +0000
Trending Topics
Recently Viewed Topics
© 2015