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Recall August 2017, restless days at Camp Barça due to incessant rumors that all summer tormented ordinary fans as well as the highest-level players, coaching staff, and management alike. Every Barcelona player was thinking about one thing: the possible transfer of Neymar to Paris Saint Germain (PSG). How was this possible? The clause was more than 200 million euros; the Brazilian was happy -or so it was believed-, he was Messi’s heir and the cornerstone of a historic trident. But, in the end, he left, and left in the coffers of the Blaugrana Club €222,000,000, the most expensive signing in the history of soccer.
With that money, many said, “now Barcelona will have everything in its favor to improve the collective structure of the team by taking an unimaginable economic advantage,” how wrong were they.
Although very expensive transfers had already taken place, such as that of Gareth Bale to Real Madrid or Neymar’s own to Barcelona, that amount of €222,000,000 completely broke open the market and inflated it to derisory prices.
In this sense, a Barcelona team, urged to make up for Neymar’s withdrawal, had to go out and break the market even more, bringing two or three pieces to reinforce the team. What happened? All the clubs in the world knew, with exactitude, that the Blaugrana management had a lot of money and that they could ask what they wanted by a player the fans wanted.
Then, this need to cover Neymar’s departure added to a constant and fair criticism directed at a leadership that was failing in sports management, leding Bartomeu and his board to go down the road of wallet populism, spending excessively and leaving the club on the edge of an economic precipice like never before in its history.
The beginning of the fall: costly and failed transfers
Barcelona went out to sign and did it very badly. It bought Ousmane Dembélé -a very talented French winger, but with different characteristics from those of Neymar, who was not yet part of the elite- and the Brazilian Coutinho, a playmaker who neither understood the role of the winger nor could cover it.
People thought that, at the same time, “Cou” could replace Iniesta’s departure in the summer of 2018; but neither did he have the ability to play as an inside man in a team as complex for that role as FC Barcelona.
In short, they were two signings, so far, that did not meet their expectations under any parameter. The first came out at about 105 million euros plus 45 in variables and the second at another 120 million plus about 40 in variables. Together they surpassed by far the departure of Neymar and both had problems of adaptation, game, and physical mismatch.
Recently, El Confidencial published a report with several interviews by different economists and experts in the Blaugrana environment that explain very well the current situation of the club’s fan base:
“Barça has suffered a liquidity crisis that resulted in a debt crisis. What it now has before it is a crisis of solvency, which is the final episode,” explained economist José María Gay de Liébana to El Confidencial when asked about the moment that FC Barcelona is going through. “Its economic situation not only threatens its continuity as a top level team, but also its very survival. The elections next January 24th will designate a new president who will have the difficult task of oxygenating the emptied coffers of the club at the same time that a new sports project is being developed”, he explains at the beginning of the report.
All this makes quite clear where and how Barcelona is standing. The club that earns the most money in the world, made the serious sin of having a populist leadership that spent unconsciously, leaving the whole institution in a bad economic and sport situation.
But now, the problem of the Blaugrana leadership is not that it stopped with the failed signings of Coutinho and Dembele. The pattern continued as expenses went on to devour everything in their path.
Expensive contract renewals of various team members were done to avoid departures like those of Neymar, whereby the salaries of the players shot up, leaving a very high and totally exorbitant payroll.
At the same time, even though they did not reach the record number of signings, the management headed by Josep María Bartomeu signed mid-level players for prices that were just as inflated as those of Coutinho and Dembélé in this context.
For example, Nelson Semedo, cost about 30 million euros, becoming -together with Dani Alves- the most expensive defender in the history of Barcelona. On the other hand, in the past, the board of directors had brought Francisco Trincao for 31 million. Both good players, with potential, but who would hardly have that price if it weren’t for the way the market behaved after Neymar’s story, and which, moreover, few imagined as elite players. And like these two Portuguese players, the examples are many.
Just to take into account, during the Bartomeu era, Barcelona spent 1,082 million euros on 34 footballers. Of all those investments, how many players could actually be said to have done well? Very few. Ter Stegen, Rakitic and Luis Suárez are, perhaps, the best in terms of performance, price, and titles. But you have names like André Gomes (37 million euros) or Malcom (41 million euros) who barely contributed.
Some will ask themselves: what happened to sales? It’s true, Barcelona sold many players and, according to the net accounts, the income was about 724 million. That is, 358 million Euros difference as compared to expenses.
In fact, many of those transfers and sales were in transactions aimed at making up for negative balances. For example, the purchase of the Bosnian Pjanic (Juventus) and the sale of the Brazilian Arthur (Barcelona) was, in reality, a joint transaction where both were part of the payment methods for their own transfers. Same case as that of the goalkeepers Cillessen (Barcelona) and Neto (Valencia).
In addition to the excessive spending carried out by Bartomeu’s populist junta, we must talk about the short-term debt that Barcelona contracted, which is well described in the text of El Confidencial:
“Barça is launching itself into the purchase of players, after the sale of Neymar, who have not given the expected result. Dembélé, Coutinho, Griezmann… They are 400 million euros in transfers that are not serving you, and part of those transfers also make up short term debt”, expressed Gay de Liébana when asked about the turning point of this wasteful history.
Gay de Liébana estimates that Barcelona’s debt exceeds 1,000 million euros, according to El Confidencial.
Barcelona, a club of members, not of sheiks
It must be understood that Barcelona, as a traditional membership club, is the opposite of teams like PSG or Manchester City that have the sheikhs’ petrodollars on their side.
In Barça, the balance sheets are very important and the accounts must be healthy so that this economic and commercial stability can be transmitted to the field of play.
The board of directors of Barcelona took as a sporting model the expense of a sheik without having the economic capacity of a sheik; not even the club that eans more money in the world -and that counts with indescribable assets like Leo Messi- could support this suicidal form of doing business.
In fact, management was so poor that almost the only thing that has saved Barcelona from the debacle is Messi.
But of course, in a way, “the big clubs work like that,” says Gay de Liébana, “they spend a lot of money because they know they have a steady stream of income. The problem is when that flow stops, as could have happened with the coronavirus or to a lesser extent in other circumstances because the teams do not have the tools to cut their expenses, a large part of which are fixed costs. Then, when the flow stops, the structure collapses quickly.”
And with this brief and concise explanation, it is clear what the two turning points were that crushed FC Barcelona’s finances. Firstly, managerial decisions after Neymar’s departure, by means of the termination clause -the team signed expensive and badly, the payroll increased, and income was not enough to cover debts and expenses- and coronavirus in 2020 which cut for several months the flow of money coming from TV rights, and attendance to matches and left naked for all the team’s fans to see how nefarious had been the sports and economic management of the team.
Not wonder did movements like the exit of Luis Suárez, Ivan Rakitic and Rafinha take place at almost zero cost, because they meant a giant relief to finances and payroll.
Success in soccer is not only due to the efforts of the players and the ability of the training staff in institutions that today are managed as companies it is vital to have people at the head office who understand the game and also the business. It is not easy to manage a club; you have to have a keen sense of what your team needs and, in addition, how to achieve it while maintaining financial and economic stability.
If FC Barcelona today is on the edge of the abyss, it is because it did not have effective management in either the sports or economic areas. And if it has not yet gone into Dante’s 9th Circle it is because it is still holding on to players who, one way or another, are holding up something that is about to collapse.