Money goes round – BusinessMirror

HOW on Earth can Barcelona splash $160 million in player transfers this past summer despite being over $1 billion in debt?

They had a fire sale of their last title team, have slashed salaries and God knows what else and now, they brought over Robert Lewandowski from Bayern Munich, Raphinha from Everton, Franck Kessie from AC Milan, Andreas Christensen from Chelsea and Jules Kounde from Sevilla. .

Except they failed to register Kounde? What gives? Was he not ratified by La Liga pending Barcelona being able to stick to their financial obligations?

However, more importantly, to pay off the debt, does one need to spend?

The same question is asked by Manchester United supporters in the wake of the Red Devils’ 4-0 thrashing at the hands of Brentford. Brent-effing-ford! That their American owners, the Glazers, have never invested in the club. Hence, their sorry state since the great Alex Ferguson retired.

And they too are in debt.

Let me backtrack on United. I do not agree that they do not have top players. They have. How did they finish second in the league two seasons ago unless that was a Covid-19 related fluke (and it looks more like that with every passing day)?

Even fans of Liverpool—my favorite team—often say that the club needs to splash on top players to compete with Manchester City that has ruled the English Premier League in the past five seasons.

Many are of the belief that to compete for silverware, you need to spend money. Winning brings in more fans through the turnstiles, sells more merchandise, increases advertising and broadcast deals.

I get that. It just beggars me that in this age of pandemic – that isn’t gone by the way – many quarters think the answer to their ills is to spend more.

But why not develop your academy then add a few players from transfers here and there? It is cheaper and you can track their progress over the years.

Spending? Yes, I know during times of crises that is when you buy when prices are down. But I still will not agree that it is a cast-iron truism. It has to be a case to case basis.

After all, buying top players does not always guarantee success. There are other factors such as chemistry, experience, coaching, health, and club history (yes, this is vital). You need to check off on all those boxes if you want to win.

As for debt, one needs to be smart about ticket pricing, merchandise, the number of seats, and well, the stadium itself that has a certain shelf life.

There is the other point of view where other clubs have to be unconventional when it comes to their approach in putting together a squad that will compete.

There is the use of analytics to recruit players who are not only under the radar and do not command a huge price. Of course, when they bear fruit there is a huge chance they will transfer to a big club such as the case of Ian Carlo Poveda who was snatched up from Brentford by Man City.

Is this where financial fair play enters?

It should because honestly, seeing the usual suspects in the Premier League win all the champions league places is appealing. Look at La Liga which is usually a two-horse race.

Liverpool put the transfer fees to good use when they sold Philippe Coutinho to Barcelona for a huge fee that got them Virgil Van Dijk and Allison Becker in return. That is good business. It isn’t always going to happen though. And we should note, that the Merseyside club was also previously in debt until the Fenway Group entered with a new strategy based on analytics and smart spending.

Brentford themselves have also adopted similar approaches to Liverpool – one that is analytics-based while picking up discards from top teams and building up these players. As a result, they have been one of the better sides in top flight English football these past two seasons.

Honestly, clubs with ambition will spend. You don’t pay a player, another club with more money will pony up the cash.

This is where Financial Fair Play comes in. Or it should. It should also help clubs like Barcelona from shooting themselves in the foot (as they already haven’t).

It is said that winning cures everything. Does it? As the Fab Four from the Merseyside once sang, “money cannot buy you love.”

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