It’s the wage bill stupid

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I might end up smashing my TV before the end of the season if I keep hearing the commentators talking about each individual player and how money their transfers have cost.

As usual these narrow minded morons don’t see the big pictures and  together with other journalists and some fickle fans put unnecessary pressure on young players, after all it is not their fault that their former clubs were greedy. The home-grown rules being imposed by the FA and FIFA have created a demand for local talent which in turn has driven the prices up. Mike Ashley who was super greedy during the whole Carroll/Torres transfer saga hasn’t helped things either as everyone now uses the Carroll price-tag as a  benchmark.

Speaking of Andy Carroll, there is an example of a kid being put under too much pressure for no reason at all. Yes we paid £35 million to sign him from Newcastle however there were many factors that made us spend that kind of money.  As you know Torres decided to leave 48 hours before the transfer window closed and this didn’t give us enough time to find someone to replace him, signing someone from outside the EPL was almost impossible with the limited timeframe. Newcastle’s Chairman Mike Ashley smelled blood, knowing that we would be receiving a huge amount for Torres he got greedy and slapped a price tag of £35 million on the young striker. Of course we sold Torres for £50 million which left us with £15 million plus of course the salary savings.

This brings me to the whole subject of this rant/article “SALARIES“, many times these are not disclosed however I can bet my left testicle that Andy Carroll is making much less than Fernando Torres was. We are probably saving a good £40K a week and when you consider the fact that Carroll has scored 3 goals to Torres’ 1 goal I say we did extremely well. Will Andy Carroll ever score the number of goals that Torres did in his Hey-days? I don’t think so, however remember that Torres was pretty much the only one scoring goals for us then and he was after all getting excellent service by Steven Gerrard who really hasn’t played much with Andy Carroll yet.

I can rant on about Carroll for hours and hours however there are other factors to consider. I am not a football expert and never have I claimed to be, I am however a management professional and I think I know something about budgets, managing labour expenses and man-management. Like in any other business most of the time senior employees tend to make higher salaries than your younger ones. So when you have players like Poulsen, Cole and Jovanovic sitting on the bench it sure doesn’t make things very economical does it?. FSG’s ‘brave new world’  focus to buy young talent serves many purposes however I am sure that salary reduction is one of the main reasons behind it.

On closing I will leave you with a little math. LFC buys player y instead of player x. The club pays £20 million for player y however player x (who some have rated better) costs £15 million. Some would claim this is insanity however when we look at the salaries we find out that player y is making £50K a week (£2.6 million a year) while player x is making £100K (£5.2 million a year). Both of the clubs would allow LFC to pay off the transfer over 3 years, if we do the math this is what we come up with as cost per year.

                       Player x          Player y
Transfer     £5 M              £6.7 M
Salary          £5  M              £2.6 M
—————————————-
Per Year     £10 M             £9.3 M

Now let us say that they both would have signed a 5 year contract, player y would cost a total of £33 million while  player x would cost £40 million.

Elementary my dear Watson.

-Antoine

35 Comments

  2. Only way we will shut them up is if we win the title. Maybe not this season but within the next few.

          1. And what does the first line say?
            Claim:   Sherlock Holmes said, “Elementary, my dear Watson.”
            Status:   False.

  4. Journalists/commentators love spouting about numbers ending in millions or billions. Remember when bird flu was going to kill half a billion people? LOL

  5. there are one more important thing, squad harmony.
    Time limit? i dont think so, he is perfect for now and future.
    Trust Kenny, YNWA

  6. Winning the title wouldn’t be enough for some so called fans, they’d still be moaning if we didn’t win the CL as well.

    When FSG spent money in the January these idiotic, so called fans complained that the money was generated by the sale of players. During this transfer window they’re still complaining because we’ve brought in good, young homegrown players with potential and to top it off they’re getting on the backs of Henderson and Carroll after 3 games.

    These are the same people who are crying that we should keep Aqua and that LFC are treating him badly, when Aqua’s agent has repeatedly stated that AQUA DOESN’T WANT TO PLAY FOR LFC, he wants to play in Italy.

    So to the muppets who are crying, whinging, moaning and getting on the back of the team here’s a message – SOD OFF and support Citeh, ManUre or Chelski because you’re not fit to wear the red of Liverpool.

  7. Good article, but you neglected to factor age into the equation. If player X is 27 and player Y is 20, what would their values be at the end of the five-year contract?

    Assuming that player Y improves, you could expect to get more than you paid for him – perhaps much more – whereas you would be hard pushed to get anything for player X.

    In fact, Torres himself is a perfect example of this, which speaks to a potentially interesting new transfer strategy: buy them young; improve them; sell then on for top dollar; and generate or buy in the new batch of talent. It’s not so straightforward in practice and you will want to keep some key players, but this is one way of balancing the budget. And following a spell of sustained success, it becomes easier to attract new talent to repeat the cycle.

    James.
    You’ll Never Walk Alone.

      1. It is not from the books by Sir Conan Doyle.But the words are used in several movies and radio productions.

  10. add on top of that, if you buy / sign a player to a very high salary you run the risk of having your top stars asking for more money to match the salary given, therefore your expense is even more and your wage structure has to be changed to accomodate new signings…

  11. Nicely put together however, torres has been one of the most productive strikers in lfc, id be happy to hv him here produce since he was till his last few wks rather than dealing with a younger immature talent that in few yrs by the time matures he will be ready to go elsewhere!
    FC

    1. That article from Tomkins Times is immense. It shows that the transfer fees under the FFP rules don’t mean jack unless you take into account length of contracts. Selling Aqua for £7m next season would mean we actually MAKE A PROFIT from him.

      All about the long term plans with the players we have signed. Not just this season, but being ready to fully exploit FFP when they come into play. Henry and the boys seem to have their heads well and truly screwed on when it comes to this.

    1. The first known quote of it was from P G Wodehouse. The film adopted the misquote. Holmes never actually said it, that is to say, Conan Doyle never actually wrote the phrase! As the first line in the link you provided says:
      Claim:   Sherlock Holmes said, “Elementary, my dear Watson.”
      Status:   False.

  14. Thank you Antoine, it was about time people were reminded about the main goals the club had for this tranfer window. Reducing the salary bill was top of the list. I don’t think it could have gone much better.

    Personally I support the “Home Grown” player idea. I remember when the Red and the Toffees were dominating English and European football with much heavier restrictions on foreign players and all our clubs (except MK Dons) were built by the local community, so it’s right that our aspiring youngsters get a better chance of making it in the EPL.

    My one concern about Carroll is that I cannot remember a great striker in the last 15 years with similar attributes. He is slow for a top class forward, but an obvious aerial threat, with a strong shot on him. Can anyone reading this blog think of a similar player who we would consider a great?

  15. To those of us with an ounce of intelligence this is quite right. We were never going to pry away Hendo for cheap, same with Carroll except with him the urgency with which we needed to secure him meant it was higher, but he still cost us nothing!

  16. As much as I hated that Torres left, I think it will prove to be good business. Carroll will never be the player Torres was, and quite frankly we shouldn’t expect him to be. He’s a differently player completely and expecting anyone to be as good as Torres was, while playing in a team that no longer relies on one player to win matches is just mad. Stop comparing apples to oranges. I don’t know about you, but for one I can say I’ve never seen Carroll sulking about on the pitch…

  17. Let me throw a spanner in the works. Are we saying, independently from what kind of player Carroll will turn out to be for the Club, that spending Stg 35 on a relatively unknown quantity, was justified because Torres left 48 hours earlier and we had to panic buy? Seriously?

      1. Antoine. We made fantastic business selling Torres for Stg 50 million, since he wanted to leave. This however will never justify why we paid Stg 35 million for Carroll in what I deem to have been a panic purchase. Again, Carroll may become a Liverpool legend but at face value I feel we overspent.

  18. very good article and very much provesthe point. something else to consider on this subject is the impact of the finanacial fair play rules. a team like man city who are spending big and paying big for an immediate success may, and i say may as who knows what the future holds, find themselves in a major state unless they are winning the PL an CL year in year out to balance the wage bill.
    if they dont they could financially crumble. as mentioned above, those older players wanting high wages due to age etc will want higher when its renewal time.

  20. Cutting the wage bill brings unity to the squad. It clears uncertainty hanging over the club regarding many players for a long time now. It can only be a positive. Kenny has kept the players who have performed & still can offer the club something. Regardless of what we have spent, our net spend is still healthy for this day and age. In addition if it doesn’t work out for the likes of Carroll, Henderson and downing, there re sale value would still probably be a combined 40 million stg. The unfortunate thing for those commentators and non believers is that this will work out and it already is. YNWA

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