The world of football is changing, or to be more specific, the chaotic world of the transfer market is changing.
The incoming Financial Fair Play laws, proposed by UEFA and officially ratified in the Premier League in April 2013, will restrict English clubs from making losses more than £105million in the space of three years.
In a climate where Real Madrid are willing to spend £86million on a single player alone, this may well seem an inconceivable challenge. And for clubs such as Manchester City and Chelsea, who have spent over £100million each on new players this season alone, many will expect FFP to claim casualties in terms of points deductions or exclusion from the Champions League – the two biggest penalties for failing to commit to UEFA’s plan of instigating a more sensible era of transfer spending in Europe.
But it’s the Premier League’s tribe of billionaire backed clubs, namely the Citizens and the Blues, who are leading the way of innovation to curtail the financial restrictions of FFP without compromising their ability to spend.
Both are rapidly changing their approaches to the transfer market, even if their outward spending may not represent this, providing two incredibly interesting transfer models that other clubs will soon feel obliged to follow.
The Chelsea project has been in effect for some time, but only recently have it’s true benefits come to light.
Over the last few years, the West Londoners have filled their reserve ranks with a surplus of prominent youngsters, cherry picked throughout Europe for relatively modest fees.
The result has been a farming out machine, astronomical in its scale and sphere of influence. Currently the Blues have 26 players out on loan – just to put that into perspective, that’s five more players than Jose Mourinho has used in the Premier League this season.
Goal.com’s Liam Twomey has described this process as; ” a truly vast operation, overseen by technical director Michael Emenalo, involving players of 14 different nationalities playing in nine different divisions across five countries, and clearly operated with an eye on more than simply developing the future stars of Stamford Bridge”
Of these 26 players, some include the incredibly coveted Romelu Lukaku and Thibaut Courtois, and a strong contingent of Chelsea hotshots at Vitesse Arnhem – namely Lukas Piazon, Christian Atsu, Patrick Van Aanholt and Bertrand Traore – who have been changing the face of the Eredivisie this season.
But for many caught up in Chelsea’s loan system, the chances are that they’ll never be graced with a senior debut for their parent club, and in reality, that’s not why they are there.
Chelsea picked up Kevin De Bruyne for £8million from Genk in summer 2012, and after just 18 months, featuring only nine times for the Stamford Bridge outfit at senior level, they sold him for £10million profit to Wolfsburg. The added value came from his season-long loan at Werder Bremen last year, where the Belgium international netted ten times in 33 Bundesliga appearances.
This is the textbook case study, the ideal model Chelsea hope many of their loaned out starlets will soon follow.
In many senses, this idea is nothing new – every Premier League club farms out talent and purchases youngsters safe in the knowledge that they’ll be worth considerably more in a few years time, should their development continue as expected.
But the sheer scale of the Chelsea machine is what makes their interpretation of the age-old idea incredibly unique. This is not simply the case of purchasing a youngster from a lesser English academy for a compensation agreement in a relatively risk-free enterprise; this is sourcing talent from all corners of the globe for sizable original investments and intentionally farming them out, first and foremost, for a financial return.
Should they impress Jose Mourinho enough on the training pitch to one day find themselves in the Chelsea first team, then all the more proof that the system works. But if they don’t, the Blues remain safe in the knowledge that almost every young signing they make, via churning them through the club’s enormously vast, global-spanning loan machine, will one day contribute positively to their bank balance, and ultimately, their ability to conform with FFP.
At the same time, through partnerships with clubs such as Vitesse Arnhem, they receive all the usual scouting and first refusal benefits you’d expect from a parent/feeder club relationship.
Manchester City’s model is rather different, in some aspects in complete contrast, but nonetheless, it’s ultimate goal of curtailing the impact of FFP remains the same.
Over the last few years, the Citizens have developed an almost unstoppable appetite for snapping up highly-rated youth players to get full value out of their £100million, 80 acre Etihad academy. This thirst for youth has seen them invest in the likes of Jose Pozo, Zacharias Faour, Kelechi Iheanacho and Brahim Abdelkadar, to name just a few.
Their vision is to mix home-grown talents with the world’s best underage prodigies, to create an academy that can one day regularly contribute to the City first team. The self-sustainable model will cut their transfer costs and ultimately increase their freedom to spend under FFP.
Once again, this is nothing new, but City’s uniqueness lies in the enormous scouting and recruitment operation they’ve unleashed unto Europe, and the incredibly young ages of their recent acquisitions, the youngest being just 14.
But in addition to that, Manchester City are also seeking to expand their influence throughout the continent and beyond. The Independent revealed last Sunday that the Premier League side had hatched two deals with Portuguese clubs Gil Vincente and Boavista, which will give them a unique advantage when it comes to accessing Brazilian talent – undoubtedly the most prominent and value-for-money recruitment pool in world football.
The agreement contains all the regular advantages of first refusal and obtaining work permits for South American players – Brazilians are allowed to play in Portugal without the usual EU work permit requirements through long-standing immigration treaties, meaning the Citizens can sign players unable to work in the UK and then loan them to the Primeira Liga until they obtain the requisite experience.
But there’s another, more sophisticated level to the recently reached arrangements. Through the Portuguese feeder clubs, City now have access to thousands of Brazilian youngsters in third-party ownership. Not only are third-party players outlawed in England, giving City a unique advantage over their Premier League rivals, but they also tend to come at much cheaper cost.
At the same time, the Etihad club are now selling their ‘intellectual properties’ to Gil Vincente and Boavista – for the 2012/13 accounts, this materialised in a £22.5million figure for selling scouting and commercial services to Melbourne Heat, Manchester City Ladies and New York City FC – further improving their bank balance ahead of their FFP inspection.
I’m sure the models of Manchester City and Chelsea aren’t what Michel Platini envisaged when he announced the introduction of the Financial Fair Play laws back in 2009. There is certainly something almost sinisterly capitalist about Chelsea’s farming strategy, and City’s manner of bending the rules around third-party ownership is hardly what you’d describe as a move towards the fairness of competition.
But when in danger, it’s those most threatened who become the most flexible, cunning and prepared to innovate, and through the potential peril of defying Financial Fair Play, it’s the Premier League’s biggest spenders who have found a way to survive without compromising their ability to splash the cash.
Unless the rest of the top flight is prepared to bring an end to an era that produced an overall spend of £650million in the summer transfer window, the transfer strategies of Manchester City and Chelsea are the two models English clubs will soon feel obliged to follow.