Transfer fees and FFP: a revolution in the making. « Untold Arsenal: Arsenal News, supporting the club, the players and the manager
By Richard Bedwell
Tony’s excellent piece on wages the other day prompts (on the eve of a new window opening) some thoughts on the other major part of player costs namely transfer fees.
If FFP is fundamentally designed to remove, or at least ameliorate, inflation in player costs then surely such fees will need to have downward pressure applied to them in order to bring club balance sheets into line with UEFA expectations.
In fact, I believe, this might not be so – or certainly be not anything like so urgent.
Loans have become commonplace. We also know that the Bosman ruling has significantly increased the number of ‘free’ transfers that are happening and, when there is little or no competition from financially doped clubs for a players signature, a fee might actually be quite low anyway.
However the fact remains that the vast majority of clubs rely on receipt of transfer fees to fund their existence and without them (and without a significant reduction in wage costs at the same time) many more clubs would be in financial difficulties than is even the case now.
That is not something that UEFA want to see happen and therefore, in theory, they will be far less concerned over transfer fees (and the source of their funding) than they will be about wages.
After all if, for example, Abramovich finds a way of funding a big transfer into Chelsea, that will represent new money into the game that will be passed almost in its entirety to another less wealthy club. It will help to secure that club’s future as long, of course, as they don’t fritter it away on wages and agents fees which, by definition, represent funds going out of the game completely.
Much more important to UEFA is the fact that, when that money is spent by the likes of Chelsea, it is to secure the services of a player who will be paid less than the man he is replacing. That way, over time, wage expectations throughout the game will be reduced and all clubs will benefit. This benefit will be all the more enhanced by a widespread move towards more performance related player contracts which would see players rewarded much more according to predetermined measures of team and individual ‘success’.
If we believe what we read it would appear that Arsenal are, with a significant degree of success, moving in that direction.
Given that they are also a club who, certainly in the Wenger era, have only funded transfers in from the proceeds of transfers out, any change in the levels of those fees should have little or no effect in the way the Club operates in this area.
However two things have changed at the Club which are pretty certain to have a major impact on how it operates within the market for players. We now have a much more commercially driven owner who has a basic requirement to protect his investment and to make sure that the maximum number of bums on seats is maintained and that prize money is also maximised as much as is realistically possible.
It’s also the case that cash flow into the Club from outside the game is about to leap thanks to new TV and sponsorship deals.
With Wenger being as bullish as he has perhaps ever been about the quality and quantity of talent coming through from the reserves there are plenty of indicators that money will not be spent that will merely end up choking off that potential. But the patience of the non football expert owner may not be quite so great and the prospect of non-qualification for the Champions League may prove too much for him to bear.
This coming transfer window is likely to see, all told , another decline in total net spending. But with prices falling and Arsenal quite possibly having more actual (and potential) money in their bank accounts that the rest of the EPL put together transfer strategies just might start to look a little different over the next couple of windows.
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