Average net loss per year on transfer fees for Euro's elite teams [last 5 years]

Discussion in 'The Beautiful Game' started by pc4th, Nov 19, 2005.

  1. Teso Dos Bichos

    Teso Dos Bichos Red Card

    Sep 2, 2004
    Purged by RvN
    Sure, because being third, still being in all competitions and having some of the best young talent around is really so bad... :rolleyes:
     
  2. Prenn

    Prenn Member

    Apr 14, 2000
    Ireland
    Club:
    Bolton Wanderers FC
    Nat'l Team:
    England
    You don't think clubs might get wise to that and start trying to get players to sign very, very long contracts or bump a non-renewing player in the reserves for a season?
     
  3. KenC

    KenC Member+

    Jun 11, 2003
    Yes, that happens in a way in japanese baseball, as players are not free agents for 10 years. Also, the players leverage is to demand higher signing bonuses for longer contracts. Of course, there is a self-policing mechanism, as clubs don't want to sign ridiculously long contracts, as what happens if the player declines in quality? Look at ManU's policy of only signing their footballers over the age of 30 to one-year renewables.
     
  4. KenC

    KenC Member+

    Jun 11, 2003
    Besides the Chelseas and Real Madrids, and some of the financially stupid clubs like Leeds, (actually quite a few stupid clubs), I think the transfer balance is much lower than generally perceived.

    For example, here's a snippet of an article from the ManU website on their financial performance in Fall of '03:
    http://www.manutd.com/news/fullstory.sps?iNewsid=56053&itype=466&icategoryid=123

    <<Lower operating expenses
    The total wage cost in the first six months was £37.7 million (2003 £39.7 million), a 5 per cent fall, reflecting the impact of the summer player trading activity. Other operating expenses have reduced by 16 per cent, mainly as a result of the absence of revenue shares on domestic cup games included in operating costs.

    The amortisation charge in the first six months was £10.6 million (2003 £10.7 million) with the elimination of charges for Veron being offset by new charges for the players acquired in the summer. In the second half, amortisation will be increased by the inclusion of amortisation on the acquisition of Louis Saha although this will be partially offset by a reduced charge for Ruud Van Nistelrooy following his contract extension to June 2008.
    -------

    Note that the above is for 6 months. As one can clearly see, ManU amortizes the cost of net transfer fees, and that this amount is part of operating expenses. Wages are a separate line item in operating expenses.

    Here's another tidbit:
    << Total wages were 41 per cent of turnover, compared with 43 per cent last year and are expected to remain below our target of 50 per cent for the year.>>
    The line item for wages, not including transfer fee amortization represent 41% of revenues, and below their 50% target. Interestingly, this target is very close to what the NFL uses. I believe the NFL has a hard 55% cap on salaries as a percentage of revenues.

    As for the current situation, my recollection of the latest ManU financials, which are not on their website is that wages now are above 50% of revenues.

    So, transfer fees indirectly affect wages, as the amortized amount of transfees are part of the operating budget, as are wages. Not only is the amortized amount the important figure, but it's also important to note that $1 more in amortized transfer fees does not necessarily transfer in $1 less in salaries paid. One could cut other operating expenses, like the light bill, or just run a deficit for the year, as many clubs have done.
     
  5. KenC

    KenC Member+

    Jun 11, 2003
    One final thought. The original poster's hypothesis is that transfer fees suppress wages, that's why Premiership salaries don't match those in North American professional leagues. Of course, this is posed as a question, but apparently it's a rhetorical one, as any reasonable answer on why this is NOT the case, is ignored.

    Let's assume the original hypothesis is right, the corollary then would be that clubs that sell on players and have a positive net transfer balance would then supplement their player wages by the corresponding amount. For example, let's say Fulham sell Louis Saha for 16million pounds, and don't have any other transfers of note. Did they raise wages the following season by 16 million pounds, as the hypothesis would have one believe? Of course not. Thus the hypothesis, is disproved.
     
  6. aloisius

    aloisius Member

    Jul 5, 2003
    Croatia

    The “we’ll bench you for a season if you don’t sign an extension and refuse to get transferred” is a pretty strong threat and a good weapon for the clubs.

    It is also mostly a bluff that players usually don’t call.
     
  7. Duck Manson

    Duck Manson Member+

    Feb 8, 2005
    Club:
    Juventus FC
    it is also illegal. unless its stated in their contract that the club can bench them indefinitely if they do not sign extensions when the club asks them to.
     
  8. aloisius

    aloisius Member

    Jul 5, 2003
    Croatia
    It’s not stated in their contracts that they have to be played either.
     
  9. Walter3000

    Walter3000 Member+

    Apr 8, 2004
    gainesville, Florida
    Club:
    Chelsea FC
    Nat'l Team:
    United States
    No it is not, it is up to the manager to decide who plays, that is...anybody he wants to.
     
  10. Duck Manson

    Duck Manson Member+

    Feb 8, 2005
    Club:
    Juventus FC
    the club would get destroyed in a lawsuit on this matter. roma are walking a very thin line with the cassano situation. if he sues them, theyll have no chance in justifying what they are doing to him and will lose.
     
  11. RichardL

    RichardL BigSoccer Supporter

    May 2, 2001
    Berkshire
    Club:
    Reading FC
    Nat'l Team:
    England
    No player has a legal right to get picked. If the club is not in breach of contract, and not forcing him to do things he doesn't want to do, there are no grounds for any lawsuit.
     
  12. Duck Manson

    Duck Manson Member+

    Feb 8, 2005
    Club:
    Juventus FC
    are you crazy? you can litterally beat the crap out of your boss, get fired and then sue them to death for wrongfully fiering you. and you think cassano wouldnt have a case? roma are destroying one of the more promising careers in italian footballs recent memory because he has done nothing wrong. how the fvck are roma gonna justify that? "we thought nonda was better" just aint gonna cut it. they would get destroyed. cassano would have bankrupt that team if they went to court.
     
  13. RichardL

    RichardL BigSoccer Supporter

    May 2, 2001
    Berkshire
    Club:
    Reading FC
    Nat'l Team:
    England
    no you can't, literally.

    no, he wouldn't
    how are they "ruining his career"? He's got a nice transfer lined up when his contract expires, they just aren't giving into his demands.

    they don't have to justify it.

    they are not contractually obliged to play him, even if he was clearly the best player in the entire world. He has no legal right to be in the team. No laws have been broken. No rights have been violated. No part of his contract has been breached. He does not have a leg to stand on.
     
  14. Duck Manson

    Duck Manson Member+

    Feb 8, 2005
    Club:
    Juventus FC
    yes you can. and people do.
    of course he would. he has been benched for no reasons that has anything to do with sports. theyre blackmailing him. pure and simple.
    how? look around on these boards and see how much a world cup means to a players career. cassano wont be playing in germany unless he gets to play for roma. his demands are irrelevant.
    they do if he sues them.
    im sure theres nothing in his contract that says he wont get a fair chance to play unless he signs whatever contract they offer him. so therefore theyd lose. badly.
     
  15. RichardL

    RichardL BigSoccer Supporter

    May 2, 2001
    Berkshire
    Club:
    Reading FC
    Nat'l Team:
    England
    If you are going to sue someone for breach of contract, then there has to be a breach of contract. It doesn't get any simpler than that.

    If he has no legal right to be selected, and he doesn't, then it is not possible to say Roma are doing anything illegal.

    It's no more blackmail than a player demanding a pay rise or he'll leave.

    If he's good enough, he'll be selected for the world cup, regardless.
     
  16. Teso Dos Bichos

    Teso Dos Bichos Red Card

    Sep 2, 2004
    Purged by RvN
    Roma are refusing to even consider him for selection until he signs a contract. Italy are refusing to consider him unless he plays regularly. He would have a case.
     
  17. nicephoras

    nicephoras A very stable genius

    Fucklechester Rangers
    Jul 22, 2001
    Eastern Seaboard of Yo! Semite
    Of course Cassano has no case. Unless his contract has a clause that requires him to play, he must listen to his employer. And his employer can choose to play him or not play him. He'd just waste a lot of his own money (that Roma is paying him) in hiring a lawyer.
     
  18. Teso Dos Bichos

    Teso Dos Bichos Red Card

    Sep 2, 2004
    Purged by RvN
    He has effectively been suspended by his club. He has a case.
     
  19. nicephoras

    nicephoras A very stable genius

    Fucklechester Rangers
    Jul 22, 2001
    Eastern Seaboard of Yo! Semite
    He has not been suspended by the club. So you're simply wrong.
     
  20. Teso Dos Bichos

    Teso Dos Bichos Red Card

    Sep 2, 2004
    Purged by RvN
    Thus my word choice above. The fact remains that he would have a very good case.
     
  21. nicephoras

    nicephoras A very stable genius

    Fucklechester Rangers
    Jul 22, 2001
    Eastern Seaboard of Yo! Semite
    I'm curious, Teso, what are you basing this on, your knowledge of European law? Do enlighten us.
     
  22. KenC

    KenC Member+

    Jun 11, 2003
    Presumably if you're good enough that a club wants to sign you to a long extension, then other clubs know you're good as well.

    The above scenario is a cutthroat negotiation. If a club is willing to cut off its nose to spite its face, then you know what type of club you are dealing with. Hopefully, the player realizes that a club that is playing that kind of hard ball is best avoided. The tough solution is to take the medicine and get out as quickly as possible.

    Now, if the greater threat is that not playing regularly means a player is also not going to get national team consideration, the player has to consider whether his agent is up to snuff. It's not wise to negotiate a contract that expires in a critical year, like a World Cup year, and the agent has to be held responsible.

    I dont' really know Casano's situation, but it seems to me that his decision is pretty easy. A club that would bench one of its better players is not a club worth playing for. It's too ruthless. And, an agent who would negotiate a contract for his player that expires in a WC year, is an agent not worth his salt. Sit quietly and play out the contract and get rid of the agent. Or better yet, let the public know the type of negotiating the club is using, and get public sentiment on his side. If the club struggles, public sentiment may force the club's hand to play him.

    In regards to suits, there may be an opportunity if there is a paper trail or verbal record of the team's management stating that he won't play until he re-signs. As long as there is no physical record of the threat, then his non-playing can be considered a sporting decision.
     
  23. aloisius

    aloisius Member

    Jul 5, 2003
    Croatia
    But what if they’re not ready to pay the price his current club is asking for?

    What if cassano wants to play for ,say Palermo, but they don’t have the money to pay the transfer fee? The only way he can join them is if he plays out his contract and comes as a free agent.

    I said that most of these clubs are actually bluffing , but that players usually don’t call. Cassano has called their bluff and it seems to have worked as he was playing for them last nigh.
     

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