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Everton should aim to become the ‘Arsenal of the North’ by adopting the Gunners’ business model.

Financial expert Joe Beardwood says the Blues need to put in place a long-term plan that would see the club cap wages, and invest money into infra-structure to bridge the gap to the Premier League’s elite five teams.

Beardwood, who was chief executive of Carling during their sponsorship of the Premier League, was the guest speaker at an event arranged by Everton Shareholders’ Association at Goodison Park yesterday, where he explained how the new £5bn Premier League television deal could impact the club.

The 52-year-old lifelong Evertonian says the Blues will struggle to break the stranglehold of the top five teams (Manchester United, City, Chelsea, Arsenal, and Liverpool) on a long-term basis and given the disparity in wage bills, Everton cannot expect to become a regular Champions League outfit.

Realism required to move forward

Beardwood has called for “realism” among supporters and says the success of their season should be based on where they finish in relation to their standing in the table of wage bills.

READ: Recap last night's Liveblog of Joe Beardwood's presentation.

He estimates the Blues have the 10th highest wage bill with £72.5m this term and says a 10th place finish would represent a “great” season.

But Beardwood argues that if the club are to begin closing the gap then they must improve the amount of money they earn from everything aside from the TV deal and associated merit payments – ie non-media revenue.

The former Holsten chief executive believes there are three ‘Key Performance Indicators’ that should be applied to Everton:

Non-media revenue

Wages as a % of the club’s operating costs

Operating costs ‘stay grounded’

Beardwood believes that in a climate where record levels of money are given to top flight clubs on the back of television deals, Everton are one of a number of “middle tier” clubs that must resist the demands of supporters to pump money into the playing budget in the hope of financing a top four finish.

Blues should resist temptation to pump TV cash into wage bill

He cited the examples of Newcastle and Aston Villa, whose owners significantly increased their wage bill over a few seasons in the hope it would lead to success, only to see marginal gains and no top four finish.

In the 2008-09 season, Newcastle had the seventh highest wage bill in the division yet were relegated.

At the end of the same campaign, Everton finished seven places higher than their position in the ‘wages’ table and last term, in Roberto Martinez’s first season in charge, the Blues were five places up on their wage position when they finished fifth with a record Premier League points tally.

Beardwood says the Toffees must ensure wages never go above 70% of operating costs despite the ever growing influx of TV money and lauds Arsenal’s salary cap as a shining example for long-term planning.

The Gunners’ performance off the pitch was also highlighted in the presentation, which attracted around 40 people, with Beardwood saying Arsenal’s non-media revenue has grown from £66.5m per year in the 2004/05 season to £117.4m last term.

In the same period, Everton’s non-media revenue went from £30.5m to £32m, according to figures shown on the night.

New stadium not the answer

The building of a new stadium has been seen as a way of helping to increase turnover but Beardwood argues that redeveloping Goodison is the answer.

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Beardwood says the Blues are “not a corporate club” and even with a new ground and greater number of corporate boxes, they would not see a worthwhile increase in revenue from this area.

Everton believe a new stadium is the right move for the club and are looking to develop on Walton Hall Park.

The speaker also claimed that Everton don’t have a “blue chip” board able to attract major corporate sponsorship but the Blues feel a new ground would help bring such commercial deals to the club.

Beardwood praised chairman Bill Kenwright for his devotion to the club and desire to always back his manager in the transfer market to the fullest, but did claim he does not want to sell the club.

Kenwright has long maintained, however, that he is searching for a buyer for Everton.

Beardwood told the audience last night: “The truth is he doesn’t want to sell. He’s a wonderful Evertonian. His heart is completely in the right place but it’s like having my dad, who was a docker, in control...deep down he doesn’t want (to sell).

“Bill would put every last penny the club has available into transfers and wages.

“He’d give the manager the last five pounds. But what he’s not done is impose a salary cap...and explain to fans why we’d be a net seller.”

Beardwood added: “There has never been a business plan at Everton. A lot of emotion, a lot of good people but it can’t just be about this whole model that’s been created, it can’t just be about winning trophies.”