Transfer Spending Perspective in the Summer of Neymar

neymar-psg-04082017_1paf0vz67e5f01myza67bwzsriOn August 3rd 2017, Neymar da Silva Santos Júnior joined Paris St. Germain from Barcelona in a $263 million deal that makes him the most expensive player in soccer history. The fee smashes a record set only one year earlier by Paul Pogba’s $116 million transfer to Manchester United.

The Neymar saga proved to be just the tip of the iceberg with players moving throughout the summer of 2017 at valuations which seemed unthinkable just a few years ago. Romelu Lukaku, Alvaro Morata, Alexander Lacazette, Gylfi Sigurdsson, and Leonardo Bonucci are just a few examples of large fee transfers completed this summer. Many are quick to point to PSG owner Qatar Sports Investments, an investment fund directly backed by the Qatari government, as the inflationary spark saying that investment coming from the sovereign fund is distorting the entire market. But did PSG’s big ticket purchase really set everything off?

This is where it’s helpful to have some perspective. Here’s a visualization of the net transfer spending of the top European leagues (Premier League, La Liga, Serie A, Bundesliga, Ligue 1) with the five biggest English clubs + PSG highlighted:

Note that in the past five years these six clubs have accounted for at least 30% (most years the figure is closer to 50%) of total net spending within the European leagues.

If we include all Premier League clubs the gap becomes even more pronounced, with English clubs spending the vast majority of transfer fees in the past decade barring two years in which Ronaldo and Fabregas respectively were sold outside the league.

Maybe PSG is just catching up to the party that the Premier League started?

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Transfer Spending Perspective in the Summer of Neymar

Who’s doing the buying in the 2013-14 transfer window?

Silly season is especially silly this year with big name signings flying fast and thick; Cavani,  Falcao, and Neymar were just the icing on the cake  with over 20 players worth €20m or more changing hands already this summer. Even Major League Soccer got in on the action bringing American superstar Clint Dempsey home to the States for a (large for the MLS) fee of £6m.

So it seems like activity in the 2013-14 window has been particularly intense compared to previous summers. Is this true? And if so who has done the most spending?

There are still a good 20 or so days to go in the window but one league is already a clear standout for ‘Spender of the Year’.

Hey Big Spender

EPL 2013-14 - Net Spend 10 Ten

Chairmen in the EPL have clearly gotten their new checkbooks in and are not afraid to use them. Spending activity in the EPL is also more evenly distributed, with all clubs (except for Arsenal) having a net spend so far this summer. Contrast that with Ligue 1 and you can see that the vast majority of the spending was done by PSG and Monaco (for once the headline count was actually proportional to the activity).

EPL 2013-14 - EPL v Ligue1

You can see the drastic distribution difference in spending in the different standard deviations between leagues. I have also removed the top 2 spenders from each league to show how much of an impact PSG and Monaco have on Ligue 1 statistics.

But back to our original question, has this window been more active than previous ones? To compare let’s look at a few metrics: players in/out, gross expenditure and the average buying and selling prices per player.

Quality not quantity?

EPL 2013-14 - Player movement

Player movement is down quite a bit with the numbers of players in decreasing by 403 (-71%) and players out down by 258 (-54%). Again there are still several weeks left in the window and there is always a burst of late activity but the trend looks like a decrease from previous seasons. A metric that seems right in line with the past several years is the league net spend:

EPL 2013-14 - Net Spend

€332m has been spent so far this summer on a much smaller number of net players which would suggest a certain outcome for the average buy/sell price of players…

EPL 2013-14 - Avg Prices

While the number of players moving is down the average price spent for them is higher. At the lowest €1.06m was spent per player into the league in 2011-12, so far this summer €2.58m per player has been spent. Players are also moving out of the league for less money with an EPL player costing an average of €410k to move on, down from €980k in 2009-10. In comparison to last year the increase/decrease is smaller but still as dramatic with average buying price increasing by €1.21m (+88%) and average selling price decreasing by €350k (-46%).

It is tempting to interpret this data as proof that Premier League clubs are drastically increasing squad quality by importing proven talent (higher avg prices) and selling fewer high quality players (less league exits, lower selling prices). And that maybe the case, but keep in mind  stats may change after the burst of late August activity especially as more free transfers move.

I will post an update of these stats after the window closes and numbers are more comparable.

Who’s doing the buying in the 2013-14 transfer window?

The Ridiculousness of Release Clauses

These days it seems like you can’t be thought of as a world class soccer player unless you have a super-sized release clause in your contract.  The most recently example: Barcelona have finally closed the book on the protracted transfer saga/soap opera that was Cesc Fabregas’ move to the Camp Nou.  In addition to the £35m fee paid it was announced that the midfielder had a €200m release clause inserted in his contract.

The high price is supposed to be a statement of intent to keep a player but is it really anything besides a headline grab? Continue reading “The Ridiculousness of Release Clauses”

The Ridiculousness of Release Clauses