Barca & Real Madrid..
Explaining why Real Madrid are given a wage cap worth €724m, compared to Barca’s wage cap worth €270m 💰
(A Thread)
Explaining why Real Madrid are given a wage cap worth €724m, compared to Barca’s wage cap worth €270m 💰
(A Thread)
According to Forbes, Real Madrid & Barca are the most valuable football clubs in the world.
• Real Madrid: Worth $5.1 billion
• Barca: Worth $5 billion
Money machines. Global brands, but Barca still struggle financially, despite having the fourth highest revenue (2022).
• Real Madrid: Worth $5.1 billion
• Barca: Worth $5 billion
Money machines. Global brands, but Barca still struggle financially, despite having the fourth highest revenue (2022).
However, why do Barca fans have to suffer, while their biggest rival can sign expensive star players, under a much higher salary cap…?
It all has to do with strict financial fair play rules, and how the clubs handled the difficult situation that came with COVID-19.
It all has to do with strict financial fair play rules, and how the clubs handled the difficult situation that came with COVID-19.
Economic Cost Control in La Liga look at the difference between a club’s budgeted revenue & expenses. After doing so, they set a squad cost limit (transfer fees + salaries). When COVID-19 came, Barca lost revenue for multiple seasons.
Real Madrid on the other hand were one of few clubs to end the 19/20 & 20/21 seasons with profit.
Barca registered losses worth €97m in the 19/20 season, and losses worth €481m in the 20/21 season. How?
Barca registered losses worth €97m in the 19/20 season, and losses worth €481m in the 20/21 season. How?
Barca vs Real Madrid (Transfer Balance)
- Since the 16/17 season, Barca have registered a loss worth -€453.6m for player sales vs player purchases.
- Since the 16/17 season, Real Madrid have registered profit worth €15.6m for player sales vs player purchases.
- Since the 16/17 season, Barca have registered a loss worth -€453.6m for player sales vs player purchases.
- Since the 16/17 season, Real Madrid have registered profit worth €15.6m for player sales vs player purchases.
Now, Barca have unpaid transfer fees set to be paid over the years. Real Madrid’s books are balanced when it comes to profit vs expenses for transfers. However, Barca’s biggest issue has always been one thing:
Salaries.
Salaries.
Barca consistently used 70% of the club’s total revenue on player wages. A salary structure where players earned FAR more than the market suggests they deserved.
As a consequence, when registering losses, salaries were deferred, specially during the COVID-19 times.
As a consequence, when registering losses, salaries were deferred, specially during the COVID-19 times.
When Laporta & co took over, they inherited €389m in deferred wages, on top of the original wages, transfer fees and other expenses. Barca couldn’t register enough income to handle these expenses, and therefore had little room to buy/register new players.
Even if Real Madrid & Barca generate the same amount of money, Barca have more expenses tied to transfers & salaries, as well as worse financial records in previous years.
Based on this, Barca are given a lower salary limit. Economic levers were short term solutions.
Based on this, Barca are given a lower salary limit. Economic levers were short term solutions.
Majority is reposted from an earlier thread. Also, DM me if you want to join my group chat 💙❤️
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