Europa League exit leaves Rangers counting the financial cost

At a recent Rangers shareholder meeting a fan took to his feet and delivered an eloquent but ominous warning to the new US owners of the club.

"Be very careful - as much as we're loyal, if this rot continues, the atmosphere in the crowd will lead to people not turning up and buying what you're selling us."

As the fan handed back the microphone and sat back down, his message was met with loud applause from around 800 of his fellow shareholders.

The exchange took place four days before those same supporters watched their side crash out of the Europa League with a draw 1-1 against Jagiellonia Bialystok at Ibrox.

The result was a grim reflection of the side's poor start to the season under new manager Derek McInnes.

Four games, two draws and two defeats.

And as the former Hearts manager tries to figure out how to turn things around on the pitch, the board would be wise to remember the shareholder warning.

If fans decide that they're not buying what the new consortium is selling them, the new owners will struggle to balance the books.

As Rangers struggle on the pitch, in the boardroom there will be an understanding that they need fan loyalty if they're going to fix it.

In short, financially, with the product failing, the owners need to shore up customer confidence.

As previous regimes of the club have found to their cost, that is easier said than done.

Confidence comes through winning and winning brings in the cash.

Given the financial landscape of Scottish football, the key revenue generators for the top clubs fall into two categories: European participation and player trading.

Over the past five years, and excluding matchday revenues, Rangers have taken in roughly £18m from European participation - in the last accounts, that equated to around 19% of overall turnover.

Win bonuses and costs of competing have to be taken into account but to make that kind of money this year, they would have to win the Conference League.

"For every pound you make in the Europa Conference League, you can make £2 in the Europa League and £7 in the Champions League," said Kieran Maguire from the Price of Football website.

"And of course in the Conference League you're only playing three home games as opposed to four in the Europa League, so there will be a loss of matchday income as well.

"On the positive side, if you do qualify for the Europa Conference league stage, you should have a better chance of progressing further."

Rangers, of course, must defeat Czech side Jablonec over two legs to secure league stage football and even consider progressing further.

Assuming the Ibrox club do progress, they could still be looking at a shortfall of around £8m from European football compared to recent seasons.

That kind of drop could be swallowed up fairly comfortably by English Premiership clubs or even clubs from other nations who have proved financially stable.

One way to potentially plug the gap would be through player trading - something the Ibrox club have struggled with for some time.

Reports suggest they recently turned down around £22m for their striker Youssef Chermiti before he suffered a serious injury that could keep him out for the rest of the season.

A transfer fee of that magnitude would have significantly eased the financial pressures following their Europa League exit but hindsight, etc.

Nico Raskin is widely regarded as the club's second most sellable asset.

The Belgian midfielder is currently valued at around £14.5m according to football website Tranfermarkt but even if he did move on, the club would need to find a suitable replacement.

The board recently raised £16m in capital through a share issue and say they are still looking for fresh investment.

That cash was raised on the promise that it would be spent on making the team stronger, but serious concerns have been raised about the recruitment at a club where over twenty players have been brought in over the past 12 months.

The club also shared plans to refurbish Ibrox and their training ground, all of which could come at significant cost.

The new consortium, many of whom still remain unnamed, invested an initial £20m when they took over a year ago, but it seems increasingly likely that those investors will need to dig deep again before the year is out.

How willing they are to do that remains to be seen.

Before any fresh investment, the club must convince its fans that it is heading in the right direction.

Those at the club say recent poor results haven't changed their financial outlook and desire of sustained winning and winning sustainably.

But remember the shareholder warning.

Yes, the owners have held their hands up to mistakes in the recent past, but apologies are only accepted if lessons are learned.

Chris Jack from the Rangers Review told BBC Scotland News: "You cannot knock the loyalty and support the Rangers fans have given the club over many, many years, but every individual fan or fan base has a breaking point.

"They're going to have a point where they say 'actually, I don't fancy it this afternoon and it's time for the club, the players and the manager to give me something.'

"The bond between those on the park and those off it has been fractured really early this season."

There's little for the Rangers fans to smile about at the moment but that is nothing new.

For them, in the past it has been anger but in certain quarters that anger is turning to apathy.

In football apathy comes at a cost and that is a cost those running the club can ill afford.