It seems likely at this stage that the club are going to finish on their lowest point total in over a decade. Calls for a complete revamp of the squad are ubiquitous among fans and even hinted at by the manager. With the recent news of the club now being the 8th largest in the world in revenue generated, and with a likely staggering profit to be reported in the upcoming 2018-2019 financial accounts (150+ million?), one would think the club is in good enough financial shape to spend what it takes to bring in new players to help Mourinho eventually compete at the top of the table.
However, in my mind, questions still remain as to how a rebuild will be financed. Purchasing players has never been more expensive. Further, as Arsenal's recent revenue stagnation shows, missing out on Champions League football can really impact a club's income. Right now, missing out on Europa, which is very real possibility for Spurs, would see a 100 million pound revenue drop for the club next season from the 2018-2019 figures. When you couple that with the major devaluation in potential player fees for the likes of Eriksen, Dier, Vertonghen (presuming he leaves), Rose, Wanyama, and others, as well as a lack of naming rights deal to cover stadium debt, it's not hard to envision a risk-averse chairman preferring to continue to look for internal improvement, instead of ratcheting up spending.
Of course, Levy deserves credit for sanctioning spending last summer, and many have pointed to it, as well the desire to see a full new stadium full of ticket paying fans, as a strong basis for why he will undoubtedly sanction heavy spending this summer. But, again, that spend last summer was on the back of a 100 million pound Champions League windfall and a guarantee of 60 million pounds from qualification for Champions League for the following season. That is a much more palatable financial scenario to spend in (especially with public pressure from your very popular manager), than when faced with diminishing revenues moving forward. That kind of drop in revenue also may cause trepidation about heavy spending impacting potential flexibility when it comes to Financial Fair Play in the next 3-4 seasons (this seemingly shouldn't be an issue given the club's lean wage bill and large recent profits, but Levy has cited FFP restrictions in the recent past when generally addressing transfer business). In regards to spending in the transfer market to stay competitive in order keep the stadium full in the future, it's important to remember just how small of a piece of overall revenue ticket sales are. Broadcasting and commercial revenue far exceed ticket revenues, so even if you had a drop over the course of a season to 40,000 paid per match, that would likely only account for a loss of 35 million pounds over the course of a season. Or the transfer fee of Shkodran Mustafi. So, loss of ticket revenue isn't likely to be the catalyst that drives an owner to spend in an overinflated market.
Looking forward, this January may be a good test case for what the summer will bring. The manager is clearly wanting new players to fill out an injury ravaged squad. Thus far, the club have taken on a no-risk loan, which was very smart. Will they spend 30 million pounds on a striker like Piatek? If the club opts not to spend, perhaps that is a harbinger of what is to come? It's hard to say, given the difficulty of the winter window and limited options. But it's worth watching Mourinho's reaction if the club do opt against signing a striker this window.
So this brings me to the real point I want to make and something that isn't talked enough about here: the most realistic way, with the current set-up of the club, that I see a rebuild really working well for Mourinho is for it be largely funded by the right players sales. That means selling players whose value in the transfer market exceeds their value to the squad. A good example of this is Liverpool's sale of Coutinho. His value in the transfer market was greater than his value to Liverpool. Poor examples of this, and what I see most here in suggestions of summer sales, are sales of players like Lamela and Aurier, who are currently important to the squad, but would bring little in transfer wise to allow for quality replacements. My personal opinion is that there are at least 3 players, possibly more, who have great value in the transfer market, but less value in our squad. Namely, the three players in the poll (Winks, Dier, and Dele). Each would ideally be kept as part of the squad going forward, but if selling them meant the club could spend more to genuinely fix problem areas, it would be worth moving them on while their value is high. The absolute ideal scenario would be to do what Liverpool and Atletico Madrid have done: sell players with great value in the market AND put some additional investment on top of that to build a side capable of contending. But it's undoubtedly a risk to sell good players and invest good money, and still potentially come up short.
I'm curious to see what other pathways people think are viable for a rebuild (and by rebuild, I mean become a squad capable of putting up 75+ points and make runs in the cups like in 2016-2018). Perhaps with the very low wage-to-turnover ratio the club enjoys, Levy should consider a short-term move to a model like the Milan clubs and even Bayern, where you are open to paying really large loan fees and wages for out of favor players, but with no large transfer fee commitments? Whatever happens the rest of the season on the pitch, Levy has some major decisions to make about the trajectory of the club next summer.
However, in my mind, questions still remain as to how a rebuild will be financed. Purchasing players has never been more expensive. Further, as Arsenal's recent revenue stagnation shows, missing out on Champions League football can really impact a club's income. Right now, missing out on Europa, which is very real possibility for Spurs, would see a 100 million pound revenue drop for the club next season from the 2018-2019 figures. When you couple that with the major devaluation in potential player fees for the likes of Eriksen, Dier, Vertonghen (presuming he leaves), Rose, Wanyama, and others, as well as a lack of naming rights deal to cover stadium debt, it's not hard to envision a risk-averse chairman preferring to continue to look for internal improvement, instead of ratcheting up spending.
Of course, Levy deserves credit for sanctioning spending last summer, and many have pointed to it, as well the desire to see a full new stadium full of ticket paying fans, as a strong basis for why he will undoubtedly sanction heavy spending this summer. But, again, that spend last summer was on the back of a 100 million pound Champions League windfall and a guarantee of 60 million pounds from qualification for Champions League for the following season. That is a much more palatable financial scenario to spend in (especially with public pressure from your very popular manager), than when faced with diminishing revenues moving forward. That kind of drop in revenue also may cause trepidation about heavy spending impacting potential flexibility when it comes to Financial Fair Play in the next 3-4 seasons (this seemingly shouldn't be an issue given the club's lean wage bill and large recent profits, but Levy has cited FFP restrictions in the recent past when generally addressing transfer business). In regards to spending in the transfer market to stay competitive in order keep the stadium full in the future, it's important to remember just how small of a piece of overall revenue ticket sales are. Broadcasting and commercial revenue far exceed ticket revenues, so even if you had a drop over the course of a season to 40,000 paid per match, that would likely only account for a loss of 35 million pounds over the course of a season. Or the transfer fee of Shkodran Mustafi. So, loss of ticket revenue isn't likely to be the catalyst that drives an owner to spend in an overinflated market.
Looking forward, this January may be a good test case for what the summer will bring. The manager is clearly wanting new players to fill out an injury ravaged squad. Thus far, the club have taken on a no-risk loan, which was very smart. Will they spend 30 million pounds on a striker like Piatek? If the club opts not to spend, perhaps that is a harbinger of what is to come? It's hard to say, given the difficulty of the winter window and limited options. But it's worth watching Mourinho's reaction if the club do opt against signing a striker this window.
So this brings me to the real point I want to make and something that isn't talked enough about here: the most realistic way, with the current set-up of the club, that I see a rebuild really working well for Mourinho is for it be largely funded by the right players sales. That means selling players whose value in the transfer market exceeds their value to the squad. A good example of this is Liverpool's sale of Coutinho. His value in the transfer market was greater than his value to Liverpool. Poor examples of this, and what I see most here in suggestions of summer sales, are sales of players like Lamela and Aurier, who are currently important to the squad, but would bring little in transfer wise to allow for quality replacements. My personal opinion is that there are at least 3 players, possibly more, who have great value in the transfer market, but less value in our squad. Namely, the three players in the poll (Winks, Dier, and Dele). Each would ideally be kept as part of the squad going forward, but if selling them meant the club could spend more to genuinely fix problem areas, it would be worth moving them on while their value is high. The absolute ideal scenario would be to do what Liverpool and Atletico Madrid have done: sell players with great value in the market AND put some additional investment on top of that to build a side capable of contending. But it's undoubtedly a risk to sell good players and invest good money, and still potentially come up short.
I'm curious to see what other pathways people think are viable for a rebuild (and by rebuild, I mean become a squad capable of putting up 75+ points and make runs in the cups like in 2016-2018). Perhaps with the very low wage-to-turnover ratio the club enjoys, Levy should consider a short-term move to a model like the Milan clubs and even Bayern, where you are open to paying really large loan fees and wages for out of favor players, but with no large transfer fee commitments? Whatever happens the rest of the season on the pitch, Levy has some major decisions to make about the trajectory of the club next summer.
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