Transfer Window Open: What will clubs do if they have to pull the cord and open the parachute in 10 months time?

Monday 6 July 2015

The Transfer Window opened on Wednesday and now is the time of the year when all clubs will look to strengthen their squads with vast amounts of money committed by Premiership Clubs, not only in transfer fees (and invariably Agents commissions) but major investment in players contracts, where the ‘average’ salary is close to £50,000 per week.

Where clubs ought to be concerned is how they structure their player contracts when signing players, particularly where the club are being speculative in signing new players, none more so than the newly promoted clubs; Bournemouth, Watford and Norwich. Standard protocol should be that the players have clauses inserted into their contracts that if they were to fall into the Championship, players would see their salaries fall by up to 50 per cent.

In our Blog two years ago, we discussed that Newcastle United did not insert relegation clauses into any of the five French imports who arrived at St. James’ Park in the 2013 January transfer window. Mathieu Debuchy, Yoan Gouffran, Mapou Yanga-Mbiwa, Massadio Haïdara and Moussa Sissoko cost the club a whopping £31m in transfer and agents’ fees.

The new television rights deal for showing Premier League matches means that

Premiership teams may receive £60m – a £14m increase in income. This only expands the financial gap between the Premier League and the Championship. With broadcast revenue accounting for around 40% of the club’s total income and each place dropped in the Premier League previously costing the club £750,000 per place, the new TV rights package has bumped this figure up to £1.5m.

The problem for any team coming up from the Championship is that they have to pay over the odds to attract players with Premiership experience. The plight of QPR demonstrates that the club’s bargaining position is not a strong one as it was reported they had to leave out relegation clauses to ensure players would sign. The financial sucker punch is that players on long term contracts and inflated wages make them difficult to move on.

Perhaps the worst example of a player wishing to see out a long term well paid contract is that of Winstone Bogarde; the former Dutch international only appeared eleven times during his four-year contract with Chelsea, reportedly earning £40,000 a week during this period. The Blues even won a domestic trophy during this period triggering a bonus payment in agreement with his contract, despite Bogarde not featuring at all that season. Bogarde himself sums up the motivations of a footballer with a small window of opportunity to secure long term lucrative:

“This world is about money, so when you are offered those millions you take them. Few people will ever earn so many. I am one of the few fortunate’s who do. I may be one of the worst buys in the history of the Premiership but I don’t care.”