Liverpool FC Need to Adapt to Modern Transfer Market

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For the second time since 2008/09, Liverpool FC qualified for the Champions League. The club appears to finally on the right track to achieving its long-term ambitions of first returning to the top table of European football, and second, to win titles as part of that. Essential to meeting these objectives consistently is the signing of new players, for the starting XI, which would help Liverpool progress from a team that just pipped Arsenal to fourth spot, to a consistent title challenger. However, reports emerged recently, that once again Liverpool FC were struggling to wrap up a transfer deal for one of their primary targets due to issues regarding wages, and the wage structure at the club. Having reportedly agreed a basic contract, negotiators backtracked and restructured the contract against the wishes of the player’s representatives.

Thus the question must be asked: is the club jeopardising its long-term future for the sake of contracts, and a wage system that is arguably best suited to clubs that do not consistently challenge for domestic and European trophies?

Whilst not in explicit agreement, Jonathan Northcroft, from the Sunday Times, certainly suggests some credence to the notion of Liverpool not signing players because of wage/contract structures.

On the latest edition of the Gags Tandon Show, Northcroft asserted that:

‘Liverpool keep missing out on players because of wages.’

He then went on to claim that he believed Virgil Van Dijk would not join Liverpool, as in financial terms:

‘Liverpool just are not in the ball park that Manchester City and Chelsea are.’

Are these claims true? Well, going by the information leaked regarding the Van Dijk negotiations, it would very much appear so in this instance. However, is Liverpool missing out on key players due to wage demands a consistent theme, and are Liverpool in the right to have reneged on their initial offer? Additionally, in comparison, what is the going rate for other top Premier League centre-backs?

Firstly, Liverpool are still yet to conclude contract talks with Emre Can, and have had a poor history with securing targets; we need only look at deals that were widely expected to be completed, such as Dele Alli, Konoplyanka or Mohamed Salah, when he first joined Chelsea. In this respect, Liverpool’s transfer issues appear to be a very real structural problem.

Liverpool reportedly offered Van Dijk’s representatives a flat-rate £180k p/w package, one which would make him the second highest paid player at the club, after Philippe Coutinho. However, the Liverpool negotiators allegedly backtracked, instead offering a restructured £130k p/w deal which would include performance based bonuses that may contribute to an overall value of £180k p/w.

To understand the relative value of a £180k p/w deal, it may be useful to look at other top Premier League centre-backs.

Currently, the top centre-backs in the league have contracts which entitle them to roughly £120k p/w, this includes players such as David Luiz, Vincent Kompany and Nicholas Otamendi. However the landscape in relation to centre-backs, and their wages is shifting rapidly. These figures in relation to Van Dijk are misleading. These deals with Luiz, Kompany, Otamendi etc., were all made before the value of the television deals had permeated through into the clubs.

The influx of capital, brought about via television deals, has seen the value of contracts go up very recently. For instance, Dejan Lovren is now earning around £100k p/w, a rate close to that of both Kompany and Luiz, but higher than that of Koscielny and Chris Smalling, and equal to John Stones. Only a few years ago, paying £100k p/w to a second choice centre-back would have been extremely abnormal; however, the increased capital available to clubs has made for a market in which players, agents, and selling clubs, are quite aware of the capacity for the buying club to pay more.

Liverpool have shown both an awareness and understanding of this in initially offering Van Dijk 180k p/w, but this wage structure has come at a cost to signing players before, and seems very likely to do so again. This is an inflexible approach that is not suitable for the current economic climate. The club must adapt, and readjust policy in relation to transfers, especially considering that these transfers apparently hinged on Champions League qualification alone.

In the past, these performance-based contracts may have worked, and in fairness, Manchester City adopted this approach in part, but when a player is in demand, as Van Dijk is, with Manchester City and Chelsea interested, the club cannot dither, appear weak or thrifty.

The demand for Van Dijk, and his obvious quality, has seen Southampton value him at £50 million, a price which would directly affect his wages. After all, a player bought for £50 million should command wages deserving of a £50 million player.

The rise in transfer fees is intrinsically linked to the rise in wages, and whilst Liverpool are becoming more flexible in relation to transfer fees, the club is only halfway in adapting to the evolving economic environment of the Premier League. Essentially, transfer fees are largely relative: the demand for the player, the desirability of them and the necessity of them to the buying club all come into account in forming the transfer fee – which then affects the wage rate. For instance, Liverpool’s purchase of Andy Carroll, Manchester United’s acquisition of Paul Pogba, or Manchester City’s deal for John Stones all saw the clubs pay over the odds for players, precisely because of how the demand, desirability and perceived necessity of all three players was so high.

Football clubs are about image as much as anything; being in the Champions League is not enough, the club must appear to be a strong one, with ambitions that will be close to realisation. The image that is portrayed when the club dithers on transfers is one of a smaller club. Inflexible and outdated. This is arguably an issue that has plagued Arsenal in recent years, with its wage structure seeing star players such as Özil or Sanchez earning far less compared to their Manchester City or Chelsea counterparts – perhaps one reason as to why Arsenal have not won the league in since 2004.

Liverpool’s reluctance to finalise the contract talks with Van Dijk appears indicative of a club that does not take itself seriously enough to be in the big leagues.

The centre-back spot is arguably the biggest issue within the Liverpool team. Liverpool’s requirements for a centre-back are extremely specific too: they need to be strong on the ball, have good distribution, aerially strong, quick and able to defend large spaces in behind. Van Dijk satisfies all of these criteria, is young, and has Premier League experience. It’s clear he is one of Klopp’s primary targets. Why then are the club not pulling out all of the stops to secure this player, at any cost, especially when two of Liverpool’s would be title competitors are vying for his signature.

The decision-makers within the club must realise that the Premier League is growing increasingly competitive, and in order to just keep pace, let alone improve, concessions must be made in relation to the wage structure, as it is representative of a smaller team, with lesser ambitions. The key to retaining the Champions League position and building upon it would be buying starting XI quality players – yet the club are currently failing to do so, because of wages. Whereas Manchester United, Manchester City and Chelsea adhere to a different structure. Performances play a role, however purchasing the player, and thus on-field results and performances are given primacy in priority. This is precisely what allows them to compete at the highest level consistently; compared to Arsenal for instance who have a rigid wage structure and have failed to compete seriously in both the Premier League and Champions League for over a decade.

To return to the top table of European and English football, Liverpool, the board and FSG must acknowledge that the football world is one that is constantly changing, and one in which a wage structure cannot get in the way of primary transfer targets. Liverpool FC, and its negotiators must break free of these archaic shackles which are grounding the club, and allow Jürgen Klopp free rein in choosing and attaining his transfer targets, so that he has the best possible chance of reaching the ambitions he and the fanbase expect of Liverpool FC.

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  1. Forget Van Dijk, they’re haggling over Salah; by the time they’ve sorted that out young Virgil will be in a City shirt.

  2. For the most part I think the Arthur is right on. I also think that certain players are foundation players that a team can build around. LfC would gain twice by signing Van he would be playing for us and our competitors wouldn’t have him. Ultimately you get what you pay for.

  3. Everton and City, like everyone else, was aware of the new Tv deal money when Stones signed for 47.5m yet he’s on 100k. Same situation for Luiz and others on 120k. Van Dijk is offered 130k basic whether he plays or not. If he plays and performs (clean sheets, tackles-in, etc.) he gets up to 50k more a week. His Agent is trying to pull one over us and I don’t believe even City would give 80k pw more basic pay than they’re giving Stones or 60 more than Kompany. 130+50k is more than enough for a decent CB- probably too much as it’ll shoot CF salary expectations to 300k basic for dross.

    Klopp and FSG need to be careful and wise to moneygrabbing Agents that distort fans expectations. I’m confident we’ll get him for the proper inflated market price- not the Disney World money and will keep some change to pay a LB a decent wage too.

  4. I think the author did well in explaining and making the comparison. As a fan I would like to see my club excel in the right direction, we have been talking about this CB from early in the season, I foresee the vision of the club with a strong and athletic CB who reads the game well

  5. We all do Bari but we have to know how Agents can manipulate the market by putting out spurious information to get more. How do we know it wasn’t the agent who’s changing the terms of the wages structure? LFC are consistent in their wage structure – basic plus bonuses etc. Why would an agent be suddenly surprised on an agreement made weeks back? Don’t believe that This is Anfield forwarded piece- full of speculation and nonsense.

    We all want Van Dijk but we’d like some others too if we’re not screwed by meeting false wage claims for the one player.

  6. I would love it if LFC signed VVD but £180k per week is a massive amount for a CB. Not to mention the £50mil + that it will cost to get him from Southampton. If management decided that he isn’t worth it and went a different route I would understand. They have other needs that must be filled so they can only invest so much in one player. Besides there are other very good CBs that could be had at half the price. I would be quite happy with another Matip and he didn’t cost a thing.

  7. what a load of crap. “need to adapt ”
    you mean someone should come and shower your club with hundreds of millions just so you can wave your little plastic flags.
    Pathetic, just like your rants on the season review podcast. that was probably the worst kind of whinging podcast I’ve ever heard.

    disgraceful and amateurish, and all about self entitlement. go and support the plastics if that’s how you feel.

  8. hey redsup, sound comments. there are different ways of looking at the VVD situation if we even come to terms with fifty frickin million quid in the first place.

    First, as you say we always incentivise contracts and if the agent doesn’t know that he needs to remove his head from his arse, but of course he needs to make the club look bad to apply pressure.

    But secondly what if we did change it. so what? we’re allowed to change our minds and if the club suddenly tacked on £20m to what was understood to be the price, then why shouldn’t we look to change the structure of the wages. This way, it incentivises £10m of the wage packet while the club have to find the other £10m.

    So VVD does his bit to make the txfer price palatable but at least his contribution in this negotiation is recoverable if we perform. Sounds like a good compromise for a ridiculous transfer fee, after all VVD did sign a long term deal and now wants something better. So why shouldn’t he come to the party in making the numbers work given the greed so abundant in all this?

    It’s important that fans speak about the greed in all this and not just accept the sky and PL agenda of more and more money.

  9. Well written article and states what most fans are saying. However, I do agree with the wage structure method FSG is following and I belief it is very doable but they need to be more professional in their approach than they are so they wont lose their creditability. Offering Virgil at first, flat £180k p/w and then changing it to a bonus related £180k p/w package is nothing short of stupidity and as unprofessional as it gets.

    We now know why we lost Dele Alli and Salah last time. Because the people negotiating for LFC are at best, stupid. Harsh words but you dont negotiate like this if you want something badly.

    I like to see financial structure at LFC that makes the club responsible in any way and it can be achieved but by working extra hard in finding those gems out there before the big spenders find them. All in all, with this tactic LFC will always end up as a “feeder club” to the big spenders as we have shown that we are very willing (as most teams are) to sell our best players if we get high offers for them. Dont expect miracles from the club.

  10. This article that focuses on expenditure on fans’ dream targets but ignores to address the other side of the equation; income. Leicester won the league with a team that cost a fraction, both in terms of transfers and wages, of most EPL teams. Sadio Mane’s transfer for circa £32m was a bargain that was decisively executed and that should really be the barometer by which the club’s transfer policy should be judged. Past glory has bred a sense of entitlement. Leeds, Aston Villa & Nottingham Forest were giants of the game within the last 40 years. Look where they are now…

  11. It’s fair to call the owners cheap if you feel that way, but these are proven businessmen. Even the CEO is a millionaire of his own making. So follow me when I say there is no way they work hard on a pay package, offer it, then think it was too much, and pull it back, then offer a reduced one which will also not be taken. They’re not stupid, this is an agent tactic, to sway public opinion.

  12. I totally agree that 180 grand is ridiculous money for basic pay. But that doesn’t destroy the argument made here. The wage structure plan is still bleeding us in terms of attracting Europe’s best talents, and that’s going to cost us with so many of our competitors rolling in gold. Man City just bought Van Djik with 200k pw and that stinks, because he was a real talent and now he’s slipped right between our fingers and into the money pit :3

  13. Been following Liverpool some 4 decad3s and never heard the club balked at its initial offer. The management are astute businessmen and I have loads of faith in them. We got good bargains for Matip, Mane and Gini last term. No need to dat worked up. The window ain’t open yet.

  14. Unfortunately I think the article isn’t well written nor researched properly. It is only adding fuel to the fire of the #FSGout brigade implying that Henry and co are amateurs. “If” a fee was agreed with an agent it’s only logical that the structure of the fee was agreed too. So to imply that FSG went back on that ‘agreement’ sounds like total balderdash. Our wages offerings are well known and none more so than by the agents in the markets themselves.
    What’s most disappointing is that follow up articles like this reinforce the original ridiculous article that points to the previous Salah breakdown as further amateur proof. Salah himself explained how Chelsea swiped in on what could’ve been a great LFC coup by taking Salah away from Rodgers with spare change as far as they were concerned. Then they did nothing with him. Just because Salah’s improved doesn’t mean our negotiating was wrong- he was unproven then. We’ve taken loads of chances on players like him at those prices and some worked out and some didn’t (Coutinho vs Aspas for e.g.). Just because one we lost comes good doesn’t mean we’re not doing our signings wrong and the stupid article get credence by follow ups like this one.
    Van Dyjk’s a great player. If the deal is 130k+50 then it doesn’t make Coutinho look a fool for signing a 155k pw deal months back. This is important for all the squad. I’d pay 50-60m for him and wages as above. No more. No flat 200/w whether he’s out on injury or playing. If package is not good enough..,?- then buy 2 decent unhyped Italian or German or Scandinavian CBs for 30m each and 65k pw with bonuses if fit.

  15. Agree…get Virgil at any cost!!! We must progress fast with class and stop spending on mediocre buying 10 players at 30mill where we should be buying 5 class players @ 50 mill. We must strengthen our image by getting our targets and get respect amongst the elites in Europe.

  16. Set aside 150 mill off set by Sakho sale 30mil and other sales to raise us to around 50 mill in sales we will spend our quota plus have the bonus 50 from sales but we will be competitive in every area on the field which equates to us competing in all competitions we are entered in !!!!!!!!!!! Its that simple……….oh wait…… just remembered it isn’t my money lol but seriously that’s what I would do

  17. VVD would be wearing a ManCity shirt, Hobnob legend said;
    VVD would be heading elsewhere, what’s new, Nick said;
    What do they know?
    VVD is a RED and I’m loving it.
    Player’s getting add ons and pay based on performances is the way to go…. after a good enough basic pay. (See Bobby’s massive add ons).


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