What is Value for Money?

Waiting for your team to conclude transfer deals can be an extremely annoying and frustrating experience.

Like being trapped in a lift with Garth Crooks, it has the ability to disgruntle and leave you hopelessly clicking buttons in the feint hope of a positive conclusion, but why does it take so long?

Agreeing transfer fees is complicated business, we’re all used to analysing transfer fees on the rarity that they are disclosed to the public, but how is a player’s value established? Constantly refreshing the Transfer Centre wont help the two parties reach an agreement, but there are many factors which result in the American sitcom-length sagas we see every window.

A major factor is a player’s age and how this impacts on performance and more importantly, his sell-on potential. A team will shell out more money for a player if they feel they can recoup it in the future, and may be willing to pay an excessive fee in incentives to protect themselves by only paying the full fee after seeing success.

Then there is the length the player has left on his contract. Clubs get twitchy when a star has one year remaining on his deal and the need for a sale will result in reduced bids being accepted, a decision born out of fear of getting nothing. This can be seen in the Robin van Persie saga where Arsenal are looking for a reported £30 million. He’s clearly not worth less than Fernando Torres who Chelsea paid £50 million for, yet the contract situation leaves Arsenal asking for far less. The same could be seen at a lower level where Crystal Palace let star player Darren Ambrose leave for under a million when Birmingham came knocking with 12 months left on the midfielder’s deal.

The league in which the player plays in can also impact upon value – whilst football is a global game, different markets exist within it; players prolific in France, Scandanavia and Scotland often command less of a fee than those in England. Bargains can be had if a player shines at international level and looks like he will make the grade, Nikica Jelavic and Yohan Cabaye to name but two, but for every Jelavic there is an Afonso Alves, picking the right one is where scouts truly earn there corn.

A player’s reputation cannot be dismissed either, image rights are worth a lot to football clubs and simply having a well-known player can increase shirt sales, advertising, brand awareness and television deals. Park Ji Sung’s move to QPR is an interesting example, despite not possessing any real sell-on-potential due to being 32 years old, the quality of the player and his undoubted commercial value in the East will ensure QPR get a good return on the £2 million fee and high wages they committed themselves to for the South Korean.

Then there’s the financial position of the two parties, if one club is desperate to rid someone from there wage bill they will often take virtually nothing to do so. Birmingham have been trying to rid themselves of Nikola Zigic for a nominal fee since relegation in May 2011 due to excessive wages, a sizeable fee would have been commanded had they hung on to their Premier League status, so desperation and deadlines can play a part in creating knock-down figures, you can keep a player on high wages for an extra 3 months or cut your losses and waver the transfer fee…decisions, decisions.

Alternatively it can work the other way, if a selling club is in a strong position they can afford themselves time to play hard-ball, Wolves will be in this position this summer and will be able to rebuff bids for Steven Fletcher and Matt Jarvis, maybe even be being able to keep unhappy players on the books should they not receive a suitable offer. Other clubs will be experiencing cash flow problems and will settle for reduced fees upfront as opposed to higher incentive based agreements.

Then there’s the old ‘undisclosed’ cherry which can result in fees being wildly exaggerated or under-represented. Fees are undisclosed for a reason; it could be that the selling club wishes to stop the figure being leaked for fear of fan backlash over what is perceived to be under pricing, similarly the buying club may claim to have spent more in the market then they have and so will keep figures under wraps. Don’t be naive enough to think that all publicly disclosed figures are correct either, figures may be inflated when announced to justify the sale to the sellers fans and to make the buying Chairman look more ambitious than he is – David Sullivan anyone?

Other factors such as position, versatility, nationality and injury history will also have a bearing on the numbers that our clubs will be crunching this summer in a transfer window that I suspect will involve a large percentage of loan deals as clubs attempt to tighten the purse strings and become more sustainable.

The reality is that transfer deals are a complex beast that we are unable sedate, whilst the mega-rich and mega-poor continue to coexist we are unlikely to see an injection of simplicity into a game that has already become more about numbers on spreadsheets than arrows on team sheets, so hold tight and give that F5 button a rest, we’re all in it for the long-haul this summer, you can but hope that your club gets value for its masses of money.

Stand Out Value In The Window So Far (Not including Free Transfers)

Gylfi Sigurdsson to Tottenham – £8 Million – A bargain when you take into account his age (22), potential and sell-on-value. Even if Sigurdsson has a nightmare Spurs will recoup the vast majority of the fee that they paid, which is likely to be predominantly incentive based. If he does well his value rises, if he does bad they save money on add-ons and get most of their money back. You also have to take into account the inflation of fees. Win-win for Daniel Levy.

Michu to Swansea – £2 Million – 15-goal attacking midfielder in La Liga last term, another win-win, succeeds and his value trebles, fails and his value will probably remain the same. When his contract expires he’ll still be 29 and sought after from clubs here and abroad, great business.

2 thoughts on “What is Value for Money?

  1. Gylfi Sigurdsson will be a stand out player for spurs this year, been following him since his arrival at Reading years ago, you’ll be mad not to put him in your fantasy team this year. Wouldn’t be supprised if he got 20 goals with another 15 assists. Like the article says bargin at £8 million.

    Transfer fee’s arn’t the only issue about value, players signing on fee’s and wages really determine what is good value or not.

    • I agree John, I think Van Der Vaart will be hard pressed to get starts this year with the emergence of Sigurdsson, I expect him to get between 10-15 goals.

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