Manchester United must make every penny count to beat FFP – Studio Varam

Manchester United must make every penny count to beat FFP

Manchester United is Manchester United again. Win trophies, play exciting football and make your way to qualifying for the Champions League. However, his ability to use this summer as a springboard to Premier League and European success has been compromised by a damaging combination of prolonged failure, business stagnation and even his association with a Russian airline.

United and UEFA sources told ESPN this week that the club hopes to comply with financial fair play (FFP) regulations this year, but in January director of football John Murtough officially stated that United were focusing on being “financially disciplined and compliant with FFP rules.” Murtough’s comments on a fan forum were a clear sign of challenges to come.

United’s roadmap to return to the top is not without its perils. They face a number of hurdles this summer, including a difficult balancing act to ensure they comply with the FFP even if the club enters the transfer window with new owners.

Even if a new owner comes along to succeed the Glazer family, United will be boxed in by all the negative factors that have squeezed their transfer budgets during their declining years.

United travel to Liverpool this Sunday with the aim of winning at Anfield for the first time since January 2016. They will also face Jurgen Klopp’s team believing that, after almost a decade, they are the ones on the rise while their traditional rivals face a difficult situation. period of transition and perhaps even decline.

Liverpool need to rebuild an aging midfield, with Borussia Dortmund’s Jude Bellingham their number one target, but the possibility of missing out on Champions League qualification this season (they are six points behind fourth-placed Tottenham Hotspur with one game to go). , added to the continued search for new investment by its owners to help finance projects on and off the pitch, has left the club facing an uncertain future.

Throughout their equally illustrious histories, United and Liverpool have rarely succeeded at the same time. When one has been dominant, the other has often endured a long period of turmoil. With United ending their six-year trophy drought by winning the Carabao Cup last Sunday, it seems their moment is coming again under manager Erik ten Hag just as Liverpool brace for a recession.

But it is by no means certain that United can, or will, start. Quite simply, for United’s numbers to add up, the team off the pitch at Old Trafford must perform as well as Ten Hag and his players have done recently to give the club the financial space needed to deliver the reinforcements they could do. for United to be competitive in all competitions next season and beyond.

United will need to shed a number of players to create additional funds and clear space on the salary bill. Club captain Harry Maguire, Victor Lindelof, Scott McTominay and Anthony Martial could leave. Goalkeeper David de Gea, whose contract expires this summer, has already been told that he must substantially reduce his current contract of £375,000 a week if he wants to stay.

The commercial team, led by chief executive Richard Arnold, must also reinvigorate the club’s commercial revenue streams. In basic terms, the more revenue United can generate, the more they can spend on upgrading their gaming equipment.

Since peaking at £363.1m in 2018, United’s annual trading profit has dipped to £313.5m in 2022. Like all clubs, United have had to overcome the impacts of the pandemic. of COVID-19, but they are undoubtedly earning less from their businesses. field deals.

When United agreed a five-year shirt sponsorship deal with TeamViewer in 2021 worth £47m a year, it marked a substantial drop on their previous £64m a year deal with Chevrolet. United announced earlier this season that it would end the TeamViewer deal early, and ESPN reported in January that Arnold led a trade team at the economic forum in Davos with the intention of securing a new world-record jersey deal.

United also has no airline partner, 12 months after canceling its £5m-a-year deal with Russian flag carrier Aeroflot following the invasion of Ukraine. While £5m may seem like a relatively paltry figure for a club of the stature of United, when added to the £17m drop in revenue from Chevrolet to TeamViewer, it creates a sizeable hole, especially when the Old Trafford’s wage bill skyrocketed to a record 384m last year.

Declining commercial revenue, rising player salaries and a lack of in-game success, which in turn reduces broadcast revenue and prize money, have diminished the buying power of United, which some time was awesome.

For the 2025-26 season, new UEFA regulations will restrict clubs to spending 70% of total revenue on transfer fees, salaries and agent fees. This season that figure is 100% of revenue, falling a further 10% each year.

With United forecasting overall revenue of between £590m and £610m this season, it is already apparent that last summer’s £229m spending spree cannot be repeated, especially as the club also need to reduce its £307m balance sheet. in pending transfer payments. .

With sources telling ESPN that Ten Hag has made a new center forward the club’s priority this summer, United will likely have to negotiate before they can contemplate moving for Harry Kane from Tottenham, Victor Osimhen from Napoli or the Juventus striker Dusan Vlahovic. But United will not be able to go the Chelsea route of signing new players on unusually long contracts of seven or eight years to spread the cost of their fees, and UEFA will set a five-year cap on FFP calculations in response. .

In many ways, United face the challenges that most clubs must overcome. They will have to make every pound count and justify what they spend and ultimately that is good and sensible business.

But in modern football, when clubs at the top spend fortunes to stay ahead, being sensible and sustainable doesn’t seem like the quickest way to get there.

For Manchester United, however, they have no choice.

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