Financial analysis of big-5 league clubs’ transfers

1. Introduction

Since its creation in 2005, the CIES Football Observatory has been monitoring football players’ transfers through information published by clubs, governing bodies and the media. This Monthly Report analyses economic flows for transactions occurred during the last decade from or to clubs in the big-5 European leagues: the English Premier League, the Spanish Liga, the German Bundesliga, the Italian Serie A and the French Ligue 1.

The report covers the ten-year period between 2013 and 2022. It analyses transfer fees paid by big-5 league teams (chapter “investments”), the clubs and leagues having benefited from these indemnities (chapter “receipts”), as well as the net balances at both teams’ and leagues’ level (chapter “net spending”).

The figures published include fixed indemnities for permanent transfers, eventual “add-ons” regardless of their effective payment, as well as sums invested for paying loans. The amounts paid in the case of loans with an obligation to buy are computed for the year of the transfer. Within the limits of information available, data on beneficiaries take into consideration eventual “sell-ons” negotiated by former clubs.

2. Investments

After the pandemic years, big-5 league clubs’ transfer market investments have risen sharply in 2022: +61% compared to the previous year. This holds true for both the winter (+190%) and the summer (+49%) transfer windows. The level of transfer fee expenditure observed in 2022 is the second highest over the ten-year period analysed: €6.2 billion (just about -7% with respect to the record high of 2019).

A noticeable increase compared to 2021 was recorded in the English Premier League: +€ 1.3 billion to exceed the €3 billion mark. This is an all-time record! Growth was measured in all of the major European championships. The share of English Premier League clubs’ investments out of total big-5 league teams’ ones also reached a new record in 2022: 48.5% compared to 38.7% during the whole ten-year period studied.

The rankings for clubs having committed the most money (including add-ons irrespective of their effective payment) to sign new recruits over the last ten years shows the financial power of a handful of dominant teams. Chelsea is at the top of the table with an average of €181M transfer fee investments per year, closely followed by Barcelona and the two Manchester’s clubs. The spending of the twenty most active clubs represents 52% of the total big-5 league club expenditure.

Chelsea (€333M) also tops the expenditure table for the 2002 calendar year, ahead of Manchester United (€268M), Barcelona (€267M) and the freshly Saudi-owned team of Newcastle United (€259M). The investments of the twenty most active clubs represent in this case almost 60% of total big-5 league teams’ transfer spending, which reflects the considerable gaps existing in the financial means available to clubs.

3. Receipts

The analysis of teams having benefited from transfer fees invested by big-5 league clubs over the past ten years shows that most of the money stays within the five major championships: almost two thirds of the total. This reflects the fact that the most expensive transfers generally occur between clubs of the five biggest leagues. However, in 2022, the share of fees cashed in by teams from other UEFA associations was particularly high (23.9%).

Figure 5: beneficiaries of transfer fees invested by big-5 league clubs

The Portuguese top division is the non-big-5 league that benefited most from transfer fee investments of clubs from the five major European championships. Their teams have collected €2.4 billion over the last ten years (on average €241M per year). Next, we find the English Championship (€216M/year), the Dutch Eredivisie (€172M/year) and, following further down, the Brazilian (€119M/year) and Belgian (€110M/year) top divisions.

With almost €1.2 billion in income generated by transferring players to big-5 league teams, Monaco tops the clubs’ earnings table for the ten-year period studied. Four teams outside of the five major European championships figure in the top 20: Benfica (7th, €867M), Ajax (9th, €812M), Porto (14th, €694M) and Sporting CP (20th, €551M). Though several wealthy clubs, such as Chelsea (2nd, €1.1 bn), are in the top 20, as we shall see in the following chapter, their transfer operations are in the red.

Manchester City (€279 M) is at the top of the table for transfer fees received from big-5 league clubs in 2022 (Sterling, Ferran Torres, Gabriel Jesus, Zinchenko, etc.). The English team outranks Ajax (Antony, Lisandro Martínez, Haller, Gravenberch, etc.), Brighton & Hove (Cucurella, Bissouma, Maupay, Östigard, etc.) and Porto (Luis Díaz, Vitinha, Fábio Vieira, Corona, etc.).

4. Net Spending

For an optimum understanding of the transfer market, beyond the sums spent and received, it is relevant to study the net balance of operations. With an accumulated deficit of almost €9.5 billion, the English Premier League stands apart from the rest. Conversely, despite Paris St-Germain’s highly negative balance (-€868M), the French Ligue 1 is the only competition from the big-5 recording a positive net transfer spending (+€350M) over the last decade.

The league figures for transfer operations concluded in 2022 confirm the specificity of the English case. Premier League teams registered a total negative spending of more than -€1.7 billion. This deficit is ten times higher than that of the league with the second most negative balance: the Spanish Liga (-€144M). Conversely, the French Ligue 1 (+€76M) and the German Bundesliga (+€18M) have positive figures.

Three French clubs, LOSC Lille (+€379M), Olympique Lyonnais (+€282M) and Monaco (+€215M), are at the top of the rankings for current big-5 league teams with the most positive transfer balances since January 2013. Thirteen Italian teams specialised in the trading of players follow them: Udinese (+€190M) and Atalanta (+€139M).

At the opposite end of the picture, Manchester United totals by far the most negative net transfer spending over the past decade (-€ 1.27 billion), followed by Manchester City (-€902M) and Paris St-Germain (-€868M). Twelve clubs from the English Premier League are in the top 20. All of the current English top division teams have negative transfer balances, while only five French Ligue 1 teams are in this situation.

The over-representation of Premier League clubs among those with the most negative balances for transfers is also noticeable for 2022. Indeed, ten English teams rank in the top twelve positions. Only Barcelona and Paris St-Germain break this hegemony. Conversely, Manchester City, Brighton & Hove and Leicester City are the only Premier League clubs in the top 20 of clubs from the big-5 having recorded the most positive net transfer spending in 2022.

5. Conclusion

Transfer fee investments of clubs from the five major European leagues strongly increased in 2022 in comparison to the pandemic years: +61% with respect to 2020 and +28% compared to 2021. A record spending for a calendar year was observed in the English Premier League: €3.0 billion (+€878 M with respect to the previous 2018 record).

A new record high was also registered with regard to the share of transfer fees paid by English Premier League teams out of total big-5 league clubs’ investments. From an average of 38.7% during the ten-year period studied, this percentage reached 48.5% in 2022. Ten clubs from the English top division figure in the top twelve positions of big-5 league teams with the most negative net transfer spending in 2022.

At league level, during the ten years analysed, the English Premier League cumulated a transfer deficit of almost €9.5 billion, followed by the Italian Serie A with “just” €1.4 billion. The French Ligue 1 is at the opposite end (+€350M). Manchester United tops the table for the most negative last ten years’ net transfer spending at club level (-€1.27 billion), while LOSC Lille is at the other extreme (+€379M). For 2022, the totals stretch from -€259M for Chelsea to +€118M for Manchester City.