Financial and sporting strategy

[TioPatinhax]

Hi guys,

Have a few questions about the strategy to adopt in mine specific situation. With Sporting, in my 2nd season I just did the treble in Portugal, winning League, Portuguese Cup and League Cup. However, club is in debt with around 33M in the red...

Next season, unlike this one, I will play the Champions League which should give me some extra money, but besides selling my top players what else can I do to clear this debt?! TV rights and sponsorship arent big in Portugal so I think only the Champions League will give me extra revenue for next season (also depending on how I do...) What would you do in this situation?

[milnerpoint]

Your £33M in debt? Or just with loans and stuff? I would be selling players if i was in that position.

[TioPatinhax]

33M euros in debt, by the end of the season (mid june). I do not believe I will get any extra big money until the next season starts...

Also, I forgot to add this information: Most of my top players all have clauses (non-negotiable) that in case of transfer, at LEAST 50% of their transfer fees will go to 3rd parties. For example, my best central defender (Argentina international Marcos Rojo) has a clause of 65% of future transfer to 3rd party, so even if I sell my best players, I wont make a decent profit...

[achilles-the-victorious]

The real money is made w/ transfers. You can look to save a bit of money here and there, of course, cutting down on youth recruitment, the number of coaches, not upgrading the facilities... Offering reduced contracts to veterans (although I find the signing bonus they ask for reduces the savings).

So if you have a transfer budget, I wouldn't say "Don't use it", in order to save money, I would say rather "Use it wisely". Look for players whose contracts have expired, that would be of use to the club, but not indispensible. Sign them up and look to sell within 1 -2 years.

As for transfers, don't sell if you think you can get more for a player, whether it is in 6 months, a year, 3 years, whatever. Nothing worse than selling a player and seeing him sold on for big bucks. If teams won't pay what a player is worth, sell him for what they are willing to pay, but include as large of a "% of next transfer" amount as you can.

Good luck!

[TioPatinhax]

The real money is made w/ transfers. You can look to save a bit of money here and there, of course, cutting down on youth recruitment, the number of coaches, not upgrading the facilities... Offering reduced contracts to veterans (although I find the signing bonus they ask for reduces the savings).

So if you have a transfer budget, I wouldn't say "Don't use it", in order to save money, I would say rather "Use it wisely". Look for players whose contracts have expired, that would be of use to the club, but not indispensible. Sign them up and look to sell within 1 -2 years.

As for transfers, don't sell if you think you can get more for a player, whether it is in 6 months, a year, 3 years, whatever. Nothing worse than selling a player and seeing him sold on for big bucks. If teams won't pay what a player is worth, sell him for what they are willing to pay, but include as large of a "% of next transfer" amount as you can.

Good luck!

Thanks for these tips, achilles. However, as I mentioned in my previous post, most of my top players are "stuck" with these clauses to 3rd parties or other clubs that reduce dramatically the profit I would make on a transfer.

[Herbert Fandel]

I wouldn't do anything apart from getting as far as possible in CL for the next few years, and of course you will need to keep a strong squad to do this, so I wouldn't sell your good players, especially given the third party clauses.

Perhaps if you have players who have massive wages but not in the 1st 11 you could sell 1 or 2 of them, see it as more of a freeing up wage tactic than a sale value tactic.

Also, if you have any room on the wage budget, sign free transfers. They can beef up your squad, and be sold on 6 months later.

Above all, do well in CL! Then the debt should be gone in a few years unless your wages are crazy. I have never heard of anyone in a recent FM getting sacked for bad finances, sadly.

[TioPatinhax]

How much do you get exactly in the Champions League in FM? Is it around 8M euros for reaching group stage and around 800k per victory?

[Herbert Fandel]

How much do you get exactly in the Champions League in FM? Is it around 8M euros for reaching group stage and around 800k per victory?

I think it is around that yes. Then, at the end, you get an extra share of TV money depending how far you progressed I think. If you make it far in the knockout stages I think it can be more than £10 million. You will probably get record attendence income too.

[eple]

From Wikipedia.

As of 2012–13, UEFA awards €2.1 million to each team in the play-off round. For reaching the group stage, UEFA awards a base fee of €8.6 million. A win in the group is awarded €1 million and a draw is worth €500,000. In addition, UEFA pays teams reaching the first knockout round €3.5 million, each quarter-finalist €3.9 million, €4.9 million for each semi-finalist, €6.5 million for the runners-up and €10.5 million for the winners.

Playoffs: €2,100,000

Base fee for group stage: €8,600,000

Group match victory: €1,000,000

Group match draw: €500,000

Round of 16: €3,500,000

Quarter-finals: €3,900,000

Semi-finals: €4,900,000

Losing finalist: €6,500,000

Winning the Final: €10,500,000

A large part of the distributed revenue from the UEFA Champions League is linked to the "market pool", the distribution of which is determined by the value of the television market in each country. For the 2010–11 season, Manchester United, who lost the final, earned nearly €53.2 million in total of which €27.3 million was prize money, compared with the €51.0 million earned by Barcelona, who won the tournament and was awarded with €30.7 million of prize money.

If you qualify from the group stage, you will get a TV-money reward after the final has been played. I've seen it above £20m, but maybe that is only for the biggest clubs from England/Spain/etc.

[Plainlayzee]

You need to do a Mourinho and win the CL mate i think otherwise you are struggling. Didn't Sporting have massive problems IRL?

[TioPatinhax]

They do mate, massive financial problems. Based on the numbers eple posted here, I am already guaranteed 8,6M euros which is good, and 1M euros per victory is a very tasty as well...So we will see, I guess I will try to reduce the wage budget to begin with.

[Cougar2010]

With £33m of debt its at a level where you shouldn't be looking to clear it straight away as this would likely hamper the quality of your squad.

What you should do is aim to make a profit each season before buying or selling any players. This will get the debt moving in the right direction and then, as others have said, you need to be sensible in the transfer market. Look for players who can be signed relatively cheaply on reasonable wages that can replace those in your squad who are on higher wages. You can also then look to sell one or two players a season that you can make a profit on that other teams are interested in.

Playing sensibly should see you clear that level of debt in around 3-5 seasons I would imagine, maybe less depending on transfers.

[Wonky]

Look to Porto's strategy. Scout well, buy young players, develop them, sell them on. If you do it well you should be OK.

[TioPatinhax]

Thanks for the tips guys. Also have another question, since I have a B team (competing in the 2nd division,fully professional league too) should I keep my young prospects there playing or look for better teams to loan them out?

[eple]

Not if Spanish B-teams are anything to go by.. Players stagnate there. If you have good youth facilities and good youth coaches then keep them in the u18 squad until they are 18-19 and then look to move them into the first team, or loan them out if they are not good enough, but don't loan them out to 2nd division teams. They will develop more in a top league, so maybe try get a belgian/czech/etc affiliate.

[achilles-the-victorious]

Tio, my suggestion with transfers is not to sell your top players. I am just saying transfers is how you will likely earn that money, over the years. So in this case, I would hold on to the players who are only 50% owned by the club. If you DO sell them, make sure to keep a 50% of next transfer clause, because that way the 3rd parties who are getting a cut on the transfer out of the club won't get a piece of the players NEXT transfer, so you will get 50% of the next fee, even though you technically only ever owned 50% of the player to start with!

What I meant was, use your transfer budget to bring in players who you CAN sell for a profit, either by signing transfer listed individuals or free transfers.

I think the B team should be an alright level for your 20-22 y.o. players. After that you will probably want to bring them into the 1st team or loan them.

[ajoobah]

I had the exact same problem in FM12;

http://community.sigames.com/showthread.php/305861-Sporting-CP-finances-!

[TioPatinhax]

definately not an easy club to manage!

[Chesters86]

Careful when choosing which players to sell as some of them have clauses in their contract which mean a Third Party gets a chunk of a transfer fee. I sold Rojos for £12,500,000 but due the Third Party fee they got £9,000,000 and received the remainder which didn't give much money to reinvest in a replacement.

[kykygambler]

get people from free transfers and sell them for money next window.. offer them low loyalty bonus:)

or you could just drown your team in debt and pray for a takeover

[TioPatinhax]

Start of next season, debt is now at 24M euros (was 33M before) and sold some of the older players who also had big contracts. Will now try to play with a younger squad,as the board only gave me 1,5M euros as transfer budget...

[Mattias333]

Well the fact the board have at least given you some money to spend (although not much for a champions league side) is the minor positive in your position. They can at least see some sort of light at the end of the tunnel (unless there totally bonkers and about to watch the club explode).

Have you previously signed players over 48month payments etc? That usually has a negative effect on the old bank balance.

At least you've managed to get it decreased. Good management.

[achilles-the-victorious]

Is the club really paying 9m of the debt each year? If true you only have to hold out another 3 seasons and the debt will be almost all gone.

I am at Inter, and the debt is a massive 500m to start. I am now about 8 years in and its down about 100m. The club's value was less than the total debt, when I started, but now the club is worth some $700m. I have had a negative transfer spend approaching 100m each of the last two years as well. Its good to have a war chest. I don't need it for transfers ATM because the team is already assembled, but its a young team so you know everyone will be asking for raises, and the wage bill will likely double in the next 4 or 5 years.

The best part though, is when a (world class) player you have tracked for 5 or 6 years asks to be transferred (preferably still when they are aged 27-29). Usually I try not to spend 30-40m on a player, but if they're asking for 30m to bring in a player who they previously asked 60m for, I will give it proper consideration.

[TioPatinhax]

Is the club really paying 9m of the debt each year? If true you only have to hold out another 3 seasons and the debt will be almost all gone.

I am at Inter, and the debt is a massive 500m to start. I am now about 8 years in and its down about 100m. The club's value was less than the total debt, when I started, but now the club is worth some $700m. I have had a negative transfer spend approaching 100m each of the last two years as well. Its good to have a war chest. I don't need it for transfers ATM because the team is already assembled, but its a young team so you know everyone will be asking for raises, and the wage bill will likely double in the next 4 or 5 years.

The best part though, is when a (world class) player you have tracked for 5 or 6 years asks to be transferred (preferably still when they are aged 27-29). Usually I try not to spend 30-40m on a player, but if they're asking for 30m to bring in a player who they previously asked 60m for, I will give it proper consideration.

I have to say I had to sell one of the important players of the club, Daniel Carriço, for 9M euros. That helped a bit, but then (out of my stupidity of not knowing how to work this feature) by having a private conversation with a player I told him to terminate his contract, which he did, but for 1,5M euros...! Terrible management, I know.

Can you good people tell me when the Champions League money is deposited in our accounts in FM?

[achilles-the-victorious]

I have to say I had to sell one of the important players of the club, Daniel Carriço, for 9M euros. That helped a bit, but then (out of my stupidity of not knowing how to work this feature) by having a private conversation with a player I told him to terminate his contract, which he did, but for 1,5M euros...! Terrible management, I know.

Can you good people tell me when the Champions League money is deposited in our accounts in FM?

1.5m to get rid of a player... Is that how much was left on his contract?! Yes, definitely learn from that one.

CL money comes throughout the competition. Right after a win/draw you will get the bonus money, and right when a new round starts you will receive money for that. So its late August for the first payment, I think. A sizable chunk comes at the end of the season, as well, so keep that in mind.

[TioPatinhax]

1.5m to get rid of a player... Is that how much was left on his contract?! Yes, definitely learn from that one.

CL money comes throughout the competition. Right after a win/draw you will get the bonus money, and right when a new round starts you will receive money for that. So its late August for the first payment, I think. A sizable chunk comes at the end of the season, as well, so keep that in mind.

Yea he had that much left on his contract, terrible signing from the previous management.

On a side note, during pre-season I usually ask my ass man to manage in the friendlies, but for some reason he is not doing any subs during the games! Why is that?

[achilles-the-victorious]

Can't say for sure. Is he thinking the players playing need the full 90 minutes for some reason? I.E. is it still early in pre-season? Can't say I have run into that one, but probably due to taking charge of pre-season friendlies.

[TioPatinhax]

Yes, players do need match fitness, maybe thats why he is not taking them off and playing them 90mins?

[TioPatinhax]

And when I send a player to the B team to play the odd game to get some fitness, his status automatically changes to "not needed"?! Why is that, and how can i prevent it from happening?

[dave byrd]

I'm on FM12 playing with Valencia and in a similar situation to the OP.

Took over them in May 2021. They'd sacked their manager after the last game of the season for finishing 9th in La Liga. They had debts of around £30m..

I'm now in the following season (with no European football) and with 10 games to play we're 10 points ahead of Real Madrid and have a cup final to look forward to against Seville. Will be Valencia's first league title for 20 odd years. I've trimmed the wage budget from £1.2m p/w to under 800k by offloading a lot of older players and replacing them with promising youngsters, but we are still £30m in the red even though we sell out every home game (55,000). Whats not helping is a bank loan of £1.5m p/m but that will be cleared in 3 years..

I've no option but to keep playing and bringing success to ease the money issues. Champions League football next year will help but will take a few years of stability/success to start to break even..

[achilles-the-victorious]

Debts of £30m.... Works out to about $50m. Inter's debt is still some $400m in 2021!

But at least I have largely turned things around. Sold more than 100m worth of players, each of the last two seasons! Luckily the core of the team is intact, I was just selling all the 27, 28, 29 year olds who are still good, but not as good as the emerging stars of the team (which makes sense, as the emerging stars were groomed to replace the aging stars).

So what does the board do at seasons end? Pay themselves a dividend of $30m of course, and the bank balance is at $100m. OK, fine. But the Board does realize that money came from selling players, and that is not sustainable to sell players, and pay out the proceeds in dividends! God knows I will not be sympathetic if the Board ever has to inject money into the club! I will just view it as them returning the dividends!

[eple]

It is annoying..

I have only a 12.647 stadium and relatively low income from sponsorship. I'm expected to compete on all fronts though, and with wage cost of around £1.3m pr week and non-football cost/tax/"other" totaling around £9m-£10m pr month that is becoming increasingly difficult to manage.

I've managed by selling more and more key players and only buying youngsters on the cheap. I always try to sell them on 48 months installments so that the profit is spread out and doesn't result in massive dividends, effectively allowing me to use it to cover the increasing wage costs. Still when I make a profit the chairman always take half of it.

[achilles-the-victorious]

I am all for the Board paying dividends, if it is a result of a competition win or increased sponsorship or bigger TV deal, anything for which the board can take the slightest bit of credit, I am glad for them to get paid divididends out of that income.

But when I sell players and don't replace them, because I know the current lads are good enough, but will ALL want double the pay in 4 years, then the Board isn't really helping the cause by disbursing all those funds! Just because I didn't immediately spend it doesn't mean the club doesn't need the money!

I hadn't even spend more than about $15m on one player in 8 years, before the board paid themselves that nice dividend ($30m). So of course that summer I spent $33m on a 20 y.o. striker. If its a race between the Board and myself over who can spend the money the quickest then I atleast want to give them a run for their money, as it doesn't make sense for only the manager to have a financial objective for the club!

It is annoying..

I have only a 12.647 stadium and relatively low income from sponsorship. I'm expected to compete on all fronts though, and with wage cost of around £1.3m pr week and non-football cost/tax/"other" totaling around £9m-£10m pr month that is becoming increasingly difficult to manage.

I've managed by selling more and more key players and only buying youngsters on the cheap. I always try to sell them on 48 months installments so that the profit is spread out and doesn't result in massive dividends, effectively allowing me to use it to cover the increasing wage costs. Still when I make a profit the chairman always take half of it.