As Wrexham push on and attempt to secure a third-successive promotion, it’s time to think about just how well-equipped the Red Dragons are for life in the Championship.
After securing promotion from the National League and then immediately rising up from League Two last season, nobody expected Wrexham to be gunning for promotion yet again this year.
Much of the credit for that success has to go to Phil Parkinson, who has always managed to get the best out of his players and has never been afraid to refresh the squad and allow it to evolve.
But, the Red Dragons could not have done it without the backing of Ryan Reynolds and Rob McElhenney. The pair want to take Wrexham to the Premier League one day, but just how much will that cost them, and is it even financially possible?
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Wrexham should have some wiggle room with FFP
The Championship is renowned for being a tough league, both in terms of the quality of teams in the division, and the sheer amount of money floating around the second tier, especially with some of the bigger teams benefitting from parachute payments.
We spoke to TBR Football’s finance expert, Adam Williams, about the nature of that challenge facing Wrexham if and when they get promoted, and whether the Wrexham owners have what it takes to get the team competing in the Championship.
He said: “If we’re looking at how Wrexham might perform in the Championship from a financial basis, you have to consider three things: How much capacity do they have to spend under Financial Fair Play (FFP)? Do the owners have the liquidity to fund expenditure that exceeds turnover? If the owners do have the funds, how aggressive will they be with them?
“From an FFP perspective, they should be relatively comfortable, although spending won’t increase as fast as it has done after previous promotions proportionately. In League One, FFP works by limiting clubs to spending a maximum of 60% of turnover on wages, transfers and agent fees.
“In the Championship, that goes out the window and you can lose up to £39m over a rolling three-year period, or £13m per season for newly promoted clubs.”
Wrexham’s potential comfortability in financial terms stems from the club’s incredible revenue streams, with sponsorship deals and commercial ventures helping boost Wrexham’s global brand massively since Rob and Ryan’s takeover.
| Statistic | 2021/22 | 2022/23 | 2023/24 | 2024/25 |
|---|---|---|---|---|
| Players signed | 15 | 10 | 7 | 12 |
| Amount spent | £491,000 | £0 | £326,000 | £2.14m |
| Players out | 16 | 19 | 18 | 15 |
| Amount received | £0 | £0 | £0 | £0 |
Even with the immense amount of money the pair have lost at Wrexham, the turnover at the club is still more than high enough to compensate for that, and that would only increase if they were to go up.
Williams added: “For context, they lost £5.1m in 2022-23. We haven’t got their financial results for their League Two season yet and it will be over a year until we get their figures from this season. And given that they have such an unusual business model, it’s hard to gauge how much they will have lost and therefore how much they can spend. Their losses will have widened though, for sure.
“We do know, however, that their revenue for 2023-24 is believed to have been around £20m thanks primarily to their sophisticated commercial operation. That is astonishing for a then-League Two club. It’s already more than around half of the clubs in the Championship, and several of them have parachute payments, remember.
“If I had to guess, I think turnover could reach £35m in the first season in the Championship. I think that’s relatively conservative.”
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Wrexham could spend big in the Championship, if Rob and Ryan want to be ‘aggressive’
Reynolds and McElhenney have not been afraid to splash the cash in the lower leagues, especially upon the promotion to League One. And, interestingly, they have yet to sell a player for a fee, meaning they are constantly at a loss in terms of players in and out.
Wrexham fans want more signings, though, and if the club is serious about getting promoted, they are necessary, for sure. We’re still waiting for those to arrive before deadline day, but how would the owners behave if the club were to go up?
Williams said: “You then get to a point where you’re balancing competing on the pitch and the sustainability of the business with limiting losses to £13m in your first year, £26m the year after and £39m the year after that. I think the three-year plan will be to spend aggressively but it probably will be a slower burn than Wrexham fans have become used to after previous promotions.
“However, I fully expect them to max out that £39m allowance in the medium term if they are promoted.
In terms of liquidity and the inclination to fund the spending, I think the owners will continue to back them.
“They are competing with backers with much deeper pockets than them in the Championship, but they have the minority investment from the Allyn family, which will help. If they need to borrow money, it can probably be guaranteed against future commercial revenues, so I don’t see that as being a problem either.”
As mentioned, Rob and Ryan now have Kaleen Allyn alongside them, which only strengthens the club’s position, and it will be interesting to see how Wrexham’s spending increases in the wake of her arrival.
Of course, there’s always the possibility that, one day, Rob and Ryan decide to sell Wrexham and move on. While that would be a shame for the club given the incredible connection they’ve developed with the community, it would actually be a win-win from a financial perspective, as the pair would likely have to stick around for years to come due to commercial obligations.
You look at the way Championship clubs are spending this month, with Middlesbrough spending £6m on Morgan Whittaker and Sheffield United spending £10m on Tom Cannon as just two examples, and it makes it all the more apparent just how far off Wrexham are from that level of financial muscle.
But, whether Reynolds and McElhenney actually do have that muscle to use when they need it, is another matter. Now, we just need to wait for Wrexham to get promoted to see if they’d be willing to flex it or not