It is 11pm in San Sebastián and a stunning firework display is illuminating the Old Town. As thousands watch from the beach, Chris Coleman sits on a restaurant terrace overlooking the bay and orders a bottle of vino tinto. And, as the night sky fills with another explosion of colour, he borrows the old quote from George Best’s bell-boy. “Where did it all go wrong?” he says.

The setting could not be lovelier but it is not all the high life for the new manager of Real Sociedad. A club that was in the Champions League only four years ago has just been relegated from Spain’s top division. Worse still, they are skint.

Sociedad have fallen on such hard times that the directors have demanded the team travel around Spain by road rather than air.

The longest of those coach journeys is 1,068km (or central London to John O’Groats) and then back again. Coleman just about manages to see the bright side. “At least they’re not making us swim to Tenerife,” he said.

It is certainly not to get rich that the former Fulham manager has come out to Spain and, stunning as the Basque country is, there has to be more to it than the sunshine and the views. One rumour that we can quash straightaway is that Coleman has fled marital problems. His private life was plastered over the front page of The Sun earlier this year and Neil Warnock, the former Sheffield United manager, was recently asked on radio if he would consider following Coleman abroad. “No, I’m happily married,” he said, which was nice of him.

It is a comment that says more about Warnock’s lack of tact than the state of Coleman’s marriage. “We had some problems but we are totally fine, very much together and with four lovely children,” he said. “My wife’s been here with the kids and she’s helped to pick where to live.” Told of Warnock’s comment, Coleman raises an eyebrow and offers a knowing response: “At least I'm still on my first marriage.”

While Warnock sits in England waiting for someone to get sacked, Coleman decided to take a bold step into the unknown. He had been dismissed by Fulham in April after ten years as a player, coach and manager (although without so much as a telephone call from Mohamed Al Fayed, the owner). A consortium had wanted him to come to Manchester City but, when their takeover failed, he quickly found himself becoming restless.

“I could have waited for a top Championship club but I’ve been in the dugout at Fulham and seen other managers out of a job in the stands week in, week out. And you start thinking ‘are you taking the piss?’” he said “You see them in the directors’ box having a glass of champagne with the chairman and I thought I will never, ever do that. I am not that desperate for a job and I respect other managers too much. It is hard enough without someone else on your shoulder.”

Sociedad had called a couple of years earlier on the recommendation of John Toshack, revered in San Sebastián after three stints as manager. “He’s still got a house just there over the bay and he’s a god over here,” Coleman said. “He’s been a big influence on me coming here. Working abroad was something that always interested me and the timing was right. I want to find out what it is like; the experience – and if I was good enough to succeed in another country.”

It is a bold move and one that too few British managers seem willing to take. There have been exceptions – and successful ones such as Terry Venables, Sir Bobby Robson and Toshack – but the movement of talent is mostly one-way. Coleman has bucked the trend but he is not about to put himself at the vanguard of a new wave of exports from the Premier League.

“I am not planning to stay forever, if I am honest,” he said. “I would love to go back to the Premier League but, while I’m here, I am going to learn as much as I can from the Spanish players, from their game. However long it lasts [he has signed a three-year contract] I’ll be better off for it.”

He is being helped by Steve Kean, his former assistant at Fulham, who speaks Portuguese. It is a start with the language but Coleman needs to learn Spanish as quickly as he can in an area where few speak English.

“I’m looking on it as a positive for now,” he said. “I don’t know the Basque for ‘the big Welsh bastard hasn’t got a clue’, which might be an advantage. I get frustrated when I can’t put my message across but there are some things in football that are universal.” Like a manager losing his rag. Coleman has already had to admonish some of his squad for poor time-keeping.

They begin their quest for promotion this Sunday against CD Castellon and Coleman is having to make do with the players he inherited. He is on the brink of signing David Vaughan, the Wales winger, from Crewe Alexandra for £300,000 but that will eat up his transfer budget. The financial constraints at Fulham were good preparation.

“There were lots of obstacles thrown in our way and we still stayed up every season,” he said. “We sold Louis Saha for £12 million and replaced him with Brian McBride for £700,000 so I don’t think there can be too many complaints.

“Someone at the club, not the chairman, thought they knew better and said we should be in the top ten even though we didn’t have a top ten ground, a top ten wage bill or top ten players. They couldn’t wait to say we failed but I am sitting here without bitterness. I think people know the job we did.”

Coleman won admirers for his work and for his plain-speaking. A popular member of the management set – José Mourinho was one of many colleagues who rang straight after his sacking – he would call a game as he saw it.

They seem to be warming to him in San Sebastián, with shouts of “Meester Coleyman” as he walks around the bay. The club are at their lowest ebb for a long time – their most recent trophy was the Copa del Rey in 1987 under Toshack – but the passion remains, fuelled by the underdog intensity of the Basque people.

“We took the team along the coast recently for a training session and the place was rammed,” Coleman said. “All the schools took the day off to come and watch. We could hardly get to the pitch.

“The Basque thing is still very important. We’ve got foreign players but the captain is Basque and speaks to the players before every game in a way that makes the hair stand up on your neck even if you don’t understand a word. It’s an old tradition and not something we’re about to mess with.”

One tradition he seems less eager to embrace is bullfighting. An invitation last week left him wondering if refusal would offend local sensibilities.

The rest of Spanish life, including the beach and the weather, he can tolerate although he is eager to stress that he has not come here for a sun tan. One English tabloid portrayed him recently wearing a sombrero. “This is not a holiday,” he said and if anyone wants proof, they can join him on one of those ten-hour coach trips.