Watford would face an “immediate financial blow” if they were to be relegated according to a sports finance expert, but assures fans that even then it is not the worst case scenario.

Dr. Dan Plumley, a senior lecturer in sport finance at Sheffield Business School, has explained what would happen to Watford FC if the club were to get relegated.

The club, currently 18th in the league, almost certainly need to win at Arsenal on Sunday and hope other results go their way to avoid dropping into the Championship.

How much would Watford lose?

Financially, relegation would mean an immediate £60 million reduction in revenue.

Dr Plumley explained that even the bottom three clubs in the Premier League would get around £100 million from the Premier League tv deal - but if Watford were to get relegated they would not get access to any of this money apart from solidarity payments.

In 2018/ 2019, the Hornets finished 11th in the table and received a total of £113,895,527.

However, the club would get reduced parachute payments as financial support in the Championship.

Hypothesising about a potential relegation, Dr Plumley said: “Watford will get a parachute payment. Let’s say they were relegated a club would get a parachute payment which is £90 million over three years - and it’s split £40 million, £35 million and £15 million for three seasons.

“So the difference in year one is a £60 million reduction, and it obviously depends what happens from there.”

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If the Hornets were to be relegated and then win themselves into the Premier League for the second season, then they would not get the rest of the parachute payments.

The sports finance expert admitted that the financial reduction is more difficult for clubs who were acquainted with Premier League money. He said: “It is more of a struggle for clubs if they’ve been in the Premier League for a while, a £60 million reduction is a huge sum of money whichever way you cut it.

“Yes it will be an immediate financial blow, it tends to have the biggest impact on squad costs and operational costs - player wages being the prime example.

“We’ve always argued in our research that clubs should have relegation clauses built into those contracts.”

If the Hornets do face relegation, they would have to make “strategic decisions” to see how they can invest in their squad to go back to the league - which would mean financially evaluating if they should spend resources keeping star players like Deulofeu or sell them.

Should fans be worried?

According to Dr Plumley, there is “no immediate concern” for the finances with Watford in the next year or so.

Dr Plumley said: “I think the long term future is not an issue here. Watford has been an established Premier League club for a number of years, that’s boosted the revenue profile of the club and the overall financial picture.

“It’s how you react to relegation and how you plan for that and take the reduction revenue - getting straight back up is the aim.

“When clubs don’t return to the league for four or five seasons - that’s when it starts to become more of an issue.”

The sports finance lecturer explained that teams with a parachute payment have an overall advantage than other Championship clubs to retain or attract better quality players.

Thanks to the additional financial income than other Championship teams, he says “more often or not” parachute paid teams return to the Premier League.

How about the potential new stadium / local businesses?

The lecturer believes that the discussions to move the stadium from Vicarage Road to Bushey Hall Golf Club would likely have to be put on hold without the additional money from the Premier League.

He said: “Something like a new stadium is not impossible in the Championship, absolutely not.

“The owner has access to his own forms and he can borrow money - which is not necessarily a bad thing - but you have to have that long-term view of how a stadium pays its way back and generates some revenue for the club overtime.

“Being in the Premier League just makes things easier”

He added that he doesn’t think being in the Championship would make this “completely off the table” and it could be an option in the long term.

Dr Plumley also admitted that shops are likely to have some financial impact due to less footfall from Premier League away teams.

However there is less research on the impact of shops to give an accurate estimate.

He said: “The pubs, bars, restaurants - it’s not critical to them, but it will have an impact for sure.”

Dr Plumley also agreed that with the closing of John Lewis and Debenhams in Watford, and administration of intu - relegation could have more harm into the tourism and retail in Watford.