1st of July, 2017: Every team’s first opportunity to conclude previous talks, sign players and settle business. Now, besides Arsenal and Real Madrid’s desire to acquire every single good player, the 2017-2018 season presented a lot of questions about where certain players were transferred to and from. This is the reason why the first day of the summer transfer window turned out to be a historic one in terms of transfer spending.
The craziest day
The top transfers of the opening day were: Bernardo Silva (£45m), Mohamed Salah (£37.8m), Corentin Tolisso (£37.35m), Ederson (£36m) and André Silva (£34.2m). Yes, they were all were top quality players going to top quality clubs but it was not what most people were expecting. Interestingly, none of Mbappe, Dembele nor Neymar changed clubs on this day. So, the question remained: how did the net transfer spend rise so high on the first day of the transfer window?
Corentin Tolisso, arriving from Lyon, was part of the Squad of the Year in the 2016-2017 Europa League.
The answer can be found on the number of transfers that occurred. There were 16,087 club transfers on the 1st of July alone according to Transfermarkt, while the next 10 days averaged at just 320. We are talking about 50 times the average, which is absolute madness even for Manchester City. Furthermore, it is vital to clarify that not just the top 5 European leagues were transferring players that day but leagues from the rest of Europe, Africa and Asia.
Now, what if I told you that 31.46% of the money transferred was due to only 0.12% of the players that changed club? The 20 most expensive players that were exchanged that day comprised almost a third of the total amount. All this just generates more questions: Why only on that day? What economic implications will all of this have?
We’re not talking about the kids’ table here. Just to give you a clue about the amount of money spent: football clubs transferred the equivalent of 51% of the revenue made by the pharmaceutical industry at a worldwide level in a day, according to Statista. Cleary from what we can see here, the football is its own power and the expenditure that occurs within it has far-reaching implications, as shown by the events on the 1st of July, 2017.
The tricks under the sleeve
There are two reasons why this happened.
- Firstly: Is your player really your player?
The main reason for this whole ‘first of July’ situation happening is that, despite the fact that teams may sign pre-contracts or get verbal agreements, a transfer cannot officially take place until the transfer window opens. These types of agreements may tie footballers to a club, yet the playing rights can only be officially acquired in a time period settled by each of the country’s football associations. Consequently, the situation just described may lead to the idea that teams can sign contracts and pre-agreements all year long and just confirm everything at the beginning of the transfer period. In reality this doesn’t happen, and the reason is simple: clubs wait and sell to the best option and the highest bidder.
There might be a slight sanction if a team fails to meet the requirements of a pre-agreement, but if a major offer comes from another team, why not accept it? There is no morality clause that needs to be followed, just a sanction that may be covered by the other club’s increased payment. The market is untrustworthy in this case and often allows the best bidder to obtain the players they desire, regardless of previous arrangements.
Let’s analyse the case of Alfredo Di Stefano, Real Madrid’s legend. He left Argentina as a result of a strike from national team at the beginning of 1948, leading him to play for Millonarios FC in Colombia. Then, in 1951, thanks to the ‘Pacto de Lima’, players were supposed to go back to their national leagues, with Di Stefano’s playing rights returning to River Plate, his previous team. River Plate, even without possessing the player, started negotiations with Barcelona CF trying to sell ‘La Saeta Rubia’.
Barcelona CF bought Di Stefano’s rights from River Plate from 1954, but also wanted to have him available in the 1953/1954 season. They tried to negotiate with Millonarios but the Colombian team asked for 27,000 USD that the Catalan team refused to pay. They would just have to wait until 1954.
However, Real Madrid’s iconic president Santiago Bernabéu was aware of this entire situation. He decided to pay Millonarios the aforementioned $27, 000 and sign the Argentinian to his squad. This move created a lot of controversy in Spain, which forced the Spanish Football Federation to intervene and settle the dispute. Barcelona C.F. decided to give up all of Di Stefano’s rights if Real Madrid paid a fee for him, and they did. Alfredo Di Stefano became a member of ‘Los Blancos’ who years later would write history in not just the city of Madrid, but the entire world with his feet.
Di Stefano played some games with the Barcelona F.C. shirt.
Moral of the story: Don’t wait too long; somebody else may take your player.
- The second reason for this to happen: it may have economic implications for the club.
Mohamed Salah, according to the Irish Mirror, has been the player with the fourth-most sold shirts in the Premier League during the 2017-2018 season, a little ahead of Hazard, De Bruyne and Ibrahimovic. The player bought from AS Roma had a sensational 2016-2017 season abroad and created a lot of anticipation about his arrival.
According to Deloitte, 38% of the income from the 20 top-grossing teams came from merchandising and sponsorships. Liverpool, Salah’s team, is ranked 9th with a total revenue of 424.2 million Euros, entering this classification. If you are doing the math, take this into account: We are talking about the player that sells the biggest amount of Liverpool kits nowadays, which is one of the two aspects that generates more than a third of the income for the teams that generate the highest earnings.
It may be risky to assume that if Salah hadn’t been bought by Liverpool the team would be in a much worse situation but, we can state with certainty that he has provided the institution great revenue from all this merchandise.
Mo Salah posing with his number 11 shirt at the signing of his contract.
As a player, being bought the first day of the transfer window gives every fan the opportunity to buy your shirt throughout the entire summer. This is influenced by the fact that, according to the Financial Times, the biggest retail spending by UK families is within the months that fall in the middle of the year (which include July). There isn’t a verified correlation between these two variables although, why not buy the shirt of a player when the usual expenses are low, vacations are starting and you and your friends are preparing for the upcoming season? This is not just the case of Salah, as it can be applied to many other players from the fifteen-thousand transfers that were made that day.
Should all teams buy or sell in the first weeks of July?
The answer is an absolute no. One of the most intriguing things about the transfer market is the expectation generated around rumours and probabilities of signing.
Because of a late fax, David De Gea couldn’t be bought by Real Madrid in 2015. The incident was known worldwide.
‘Uncertainty’ and ‘desire’ are two key terms in today’s world, causing the prices of assets to go up or down depending on the context. Football operates the same way. Prices may change due to speculation in newspapers or even directly between the clubs. Why take that away when it makes the football industry so interesting? This means the fun occurs when there is are no matches being played; so, let’s not underestimate this transfer period.
For us, the situation of the opening day is an end to months of talking; defining the situation of a player with no guarantees until the moment a player transfers. We still want it to be that way, as a determination of the obvious trades for some or for others, the powerful start of an unprecedented transfer window that will make a 1.57 billion transfer day look like nothing.