How La Liga clubs’ austerity in the transfer window can effect the overall product.
La Liga has surprised most of its football fans during this transfer window period. The truth is, according to Transfermarkt, only €373.150.000,00 has so far been spent by first-division clubs during this Summer window. This is less than a fifth if compared to the highest expenders, the English Premier League.
For the past years, LaLiga has been recognized for multiple additions brought into the competition. One of them has been the Salary Cost Control, which was established in the mid-2010s (2014/2015 was the first season) to reduce the debt the clubs had with the Spanish institutions concerning taxes and players’ wages. This control has also produced an end-of-year profit for football clubs hence, limited sports companies (Sociedad Anónima Deportiva in Spanish) that could operate sustainably.
This Salary Cost Control follows a formula that conditions the club’s expenditure to the club’s confirmed income for a specific season. Basic maths. However, it generates huge pressure on two specific departments within the clubs, the marketing and endorsements department, as they are the ones in charge of selling the club’s image around the world in return for money, and the finance & sports director commission, as they will rely on the money coming in to be able to register the desired players for the upcoming season.
The truth is the following, some of the clubs that have had trouble registering players during this 2023 Summer window, have also had trouble filling in the standard endorsement a football should receive money for. The likes of Sevilla, Real Sociedad or Granada, started the season without a front-shirt sponsorship deal agreed. The first two teams will perform on the 2023/24 UEFA Champions League group stage. This international exposure normally allows the clubs to ask for an upgrade when looking for commercial endorsements. We are three weeks away from the start of the competition and yet no sign of an economic injection nor a partner for these clubs.
Ironically, Sevilla has been in the spotlight very recently, not only for its great performance in the European Super Cup Final against Manchester City, nor its awful start of the campaign with 0 points in 6 but for having been forced to sell one of its most important assets to the know well known Saudi League. Yassine Bounou, the Marrocan international goalkeeper, has joined Neymar’s rooster Al Hilal, leaving close to €20 million in Sevilla’s accounts.
This has not been the only transfer a LaLiga club has negotiated with a club understood to be performing in a lower league – in terms of competitiveness and recognition – however, the clubs involved have had to look for the money even if it meant losing one of its best assets in the squad. The example of Sergio Canales, co-captain at Real Betis, who left in July to play for Rayados Monterrey and left something around €10 million in Betis’ accounts.
LaLiga has therefore focused on the sustainability of its clubs, with a close eye on FC Barcelona and the situation they are going through, whilst the commercial space of its assets, the football clubs, has received a huge impact for having to see some of its most important commercial representants, their best players, leave elsewhere.
There are still 8 days until the end of the window, and the league has already announced a 24-hour live broadcast to follow all the latest movements that could occur. Once the market is over, we could have more information to finally evaluate where is the position of the league in comparison to its main competitors. We will keep an eye on the quality of the squads, the commercial appetite of its assets and the audiences they could generate.
