Are United in Financial Trouble?

[AneRu]

It just boils down to not wanting to spend by the board. It’s a messy situation we’ve just spent £130m on 2 new defenders yet have conceded more goals in 24 games than Jose did in a full season playing Valencia Bailey Smalling Young in the back 4, they must be wondering what the feck is going on.

Sorry but your point has contradictions. You saying the board doesn't want to spend but point out that they did spend for little to no improvement so it can't be the board to blame but the so called football experts within the club.

 

[GBBQ]

No. We do not have financial trouble.

The MUFC financial statements and obligations are publicly available and they show no signs of a struggling enterprise. The club is managing its debt just fine and has a healthy overhead.

I'm sorry, these facts just wont cut it in this thread, we need hysteria and overreaction please.

 

[theklr]

We can shout, scream, chant at OT but nothing will change. Ed Woodward is the highest paid Chief Exec in the PL. He helped the Glazers secure the takeover so he has their loyalty.

They are not going to sack him and hire someone who will stand up to them. It is a very easy ride at the moment, Ed makes them money, they spend the money, Ed gets a hefty pay cheque and he deals with the protests. Simple as.

If someone paid me millions and I had to hear chants against me for 5 games a season at home, I wouldn't care so long the the 0's in my bank keep coming.

Ed is a money man, he does not care about the football, trophies etc..

If people think I am wrong then look at what the club is trying to do to get back on top? nothing.

I think you are wrong about this. He is clearly a guy that is insecure enough to care a whole lot about what other people think of him.

But that is also his problem, he flip-flops on his own decision regarding managers, and when he makes them it is of all the wrong reasons.

I mean, Chelsea sacked a CL winning manager and Barcelona sacked their manager while beiing on top of the league.

It is Woodward's insecurity that got Ole the job, it was too soon and it was the wrong decision. And now I fear he doesnt have the guts to sack him.

 

[Thisistheone]

Exactly. I said to the guy next to me last night 'if you were ever wondering what years of bad investments and poor decision making looks like, its right there in front of us'

This.

 

[AneRu]

Whilst not in any financial trouble I strongly believe the cut backs on spending are to do with the club been sold

Before money was thrown at the problem, that's not the case anymore

Maybe its more to do with the strategy not working rather than the owners looking to sell. Even though if I owned United, looking at what's been spent and what now needs to be spent to reclaim our place on the food chain I would sell. The challenge is who would buy at the price the Glazers will quote?

 

[Florida Man]

Does anybody else feel that United have some serious financial/cashflow problems that we aren't aware of? The constant and somewhat silly fretting over player's prices? The ever-growing amount of debt that the club (not the Glazers) are saddled with?

That's the only logical reason I can think of (not signing anyone) when it is so patently obvious that we need fresh players in the squad. I just don't buy the guff about there not being any players available because it is January. If United wanted a player, they sure as feck could go out and buy that player (or at least so I once thought).

This whole schtick about them changing transfer policy doesn't sit well with me and I am greatly concerned that we could go the way of Leeds if things continue on as they are....

As someone who has to be in the vicinity of the Bucs here in Tampa, I can assure you that the Glazers are here to leech us of our money. That’s who the Glazers are.

 

[Tel074]

That's not the case, we spend the same proportion every year. The difference is where we spend it, our wage bill has massively increased between 2015 and 2019 which means that we have less money for transfer fees.

Maybe . But we shouldnt we need a huge window to get in the players we so obviously need

 

[Volumiza]

You make some very valid points, but I don't think it has to do with lack of funds. We have just been historically bad since SAF left at buying talent and nurturing it. It all stems from the lack of coordination and knowledge at the top of our football ladder. There is no one overseeing a coherent transfer policy so we swing wildly from one manager to another who have different philosophies and different player needs.
Think of Barcelona which is the most obvious example, regardless of manager, they have a certain style of player they covet and this makes it much easier for them to build upon what they already have.

Until we sort that out, be it a director of football or whatever solution we choose, we're going to be a Europa League level club-.

I agree, I didn't say we've not invested, just that we haven't invested properly. If ever there was a wake up call that we need a DOF then our current state has to be that moment.

But also, if we haven't got financial problems now, we will soon start to have if we don't start moving towards success on the pitch. We have a huge wage bill, a massive ground that needs some money spending on it and if we start to become less attractive for sponsors and lose endorsements we could find ourselves in real trouble.

 

[Castia]

Sorry but your point has contradictions. You saying the board doesn't want to spend but point out that they did spend for little to no improvement so it can't be the board to blame but the so called football experts within the club.

It’s what I’m saying yes. We’ve spent money this past summer and for the majority of the past 7 years and have nothing to show for it, it’s at the point where the board are holding back on signings due to them having little to no impact.

The board have gone wrong in not appointing a DoF, that’s on them.

 

[JPRouve]

Maybe . But we shouldnt we need a huge window to get in the players we so obviously need

We shouldn't what? We spend almost all our revenue every year, we can't actually increase our spendings without borrowing and any United fans should know that spending doesn't make things better since we are outspending(wages and transfers) pretty much every clubs not named Barcelona and Real Madrid.

To put it simply, when you buy a car you add expenses to your budget, you have to pay for an insurance and fuel, these costs will reduce your ability to spend in the future unless if you find new sources of revenue that increases your budget. It's the same thing for a football club with players being the cars.

 

[AneRu]

It’s what I’m saying yes. We’ve spent money this past summer and for the majority of the past 7 years and have nothing to show for it, it’s at the point where the board are holding back on signings due to them having little to no impact.

The board have gone wrong in not appointing a DoF, that’s on them.

Agreed, ideally we should have changed tack when the Van Gaal experiment went tits up but then the scale of the problem wasn't apparent. The consensus was that all we needed was a good manager and we hired Mourinho thinking that he will help us buy success. This is where the shit really hit the fan and we now playing catch up needing to spend money we no longer have.

 

[DomesticTadpole]

No. Ole shouldn't be in charge of any rebuild. It should be an independent role.

I tend to agree. Knowing us we would hire yet another United old boy, when as you say an independent eye is needed.

 

[GlastonSpur]

The club is financially stable, but we have essentially flatlined, while everyone else has gained on us. …

This has some truth to it (although perhaps not true in comparison to all other clubs).

In 2013-14, Spurs, for example, had only 42% of United's income (€216m compared to €512.6m). But now (according to the most recent Deloitte rich list) Spurs have 73% of United's income (€521.1m compared to €711.5m).

In absolute terms the income gap with Spurs has also narrowed over this time, from €296.6m down to €190.4 ... and on the other side of this coin is the much greater wage bill (etc) at United.

 

[Denis79]

From early indications, it looks as though it'll be another record breaking deal.

Which destroys the hypothesis I was about to present. I thought that our recent reluctance in the transfer market was a part of a plan to adjust to the new economical situation, apparently not then.

 

[Paul_Scholes18]

I can think of a few reasons why we're not investing atm

- they are intent on giving someone else the job in the summer and are reserving the budget
- they are ready to sell and don't want to invest significantly until they do
- Ed or whoever is so incompetent in making deals they haven't managed to sign anyone yet

think the last one is true. Second point true as well probably.
I fear the first is not true and they will keep Ole anyway.

 

[Infra-red]

This has some truth to it (although perhaps not true in comparison to all other clubs).

In 2013-14, Spurs, for example, had only 42% of United's income (€216m compared to €512.6m). But now (according to the most recent Deloitte rich list) Spurs have 73% of United's income (€521.1m compared to €711.5m).

In absolute terms the income gap with Spurs has also narrowed over this time, from €296.6m down to €190.4 ... and on the other side of this coin is the much greater wage bill (etc) at United.

This is correct. There's no question that United will face challenges going forwards, as rival clubs begin to achieve something akin to financial parity.

On the finances, football clubs of course have three streams of revenue: matchday, commercial and broadcast. Our matchday revenue has been flat for a long time, as a result of ticket price freezes (approx £110m), our commercial revenues have been flat since 2016 (approx £275m) - the seemingly endless pool of willing sponsors has run dry - while our broadcast revenue has increased by £100m since 2016 (£140m - £240m). Unfortunately, our wage bill has also increased by exactly £100m in the same period (£230m - £330m).

In other words, all revenue sources are stagnant, except for the ever-increasing TV deals, which are immediately being used to pay for the increasing costs of player renumeration. Thankfully, the Premier League and UEFA continue to do a remarkable job of selling their products across the world, otherwise we'd have no way to pay for our ballooning wage bill.

I'd love to know what our current commercial partners are making of all of this. I'd say that the chances of the club substantially increasing on any of our headline commercial deals when they go out to tender, are dubious at best.

 

[Infra-red]

From early indications, it looks as though it'll be another record breaking deal.

Not sure what the source is for those rumours, but would not be at all surprised if it was the club itself, trying to drum up interest.

 

[SalkinA]

As said 4b-5b is a big ask and the Glazers need to lower their demands if they want to sell. Its like someone inheriting a huge mansion whom he can't afford. He either end up going bankrupt because of it (taxes, maintenance etc) while he does shoddy work that cheapens the place or else he lowers the price a bit and he sells it before it become a burden on him. The Glazers can't afford United anymore. The rebuilding is far too big for their pockets and that rebuilding will need to be factored in the price.

The difference is United bring in a lot of cash, the mansion in your comparizon doesn't. Glazers doesn't have to put in own money into united, they can keep mismanaging the club and still take out a nice "bonus" every year. They will only start to think about selling the club when they see it's more profitable to sell than not to sell. And even then their egos will stand in the way at least for while, being the owners of the "biggest club in the world" is probably a giant ego booster for them.

 

[Number4.]

This has some truth to it (although perhaps not true in comparison to all other clubs).

In 2013-14, Spurs, for example, had only 42% of United's income (€216m compared to €512.6m). But now (according to the most recent Deloitte rich list) Spurs have 73% of United's income (€521.1m compared to €711.5m).

In absolute terms the income gap with Spurs has also narrowed over this time, from €296.6m down to €190.4 ... and on the other side of this coin is the much greater wage bill (etc) at United.

This is all correct & United have a rely less than others on TV revenue as a % of earnings. The big challange when you compare the €521 v €711m is the respective wage bill. United a paying approx €165m PA more than Spurs to players and it is difficult to see how they can get out of this mess.

Bruno Fernandes has every right to ask for Parity with Marcus Rashford's 250k per week, which is insane when you look at what Spurs, Liverpool etc are paying their talent. United are caught in a horrific bind here, where every new player is getting paid 200k plus & the bill becomes a huge huge problem

For United to step forward, they have to step back from this, it sounds dramatic, but everyone on more that €100k PW needs to be shipped out with United no longer the cash cow, effectively doubling player wages compared with their competitors.

 

[Nou_Camp99]

There has been no cut backs on spendings though.

We spent a NET of about £60m last summer and so far this window we've spent nothing. On top of which we've removed millions off the wage bill. The cut backs are there and are staring you in the face.

 

[Sky1981]

We spend world record free for a defender a mere six months ago

 

[Ikon]

We spend world record free for a defender a mere six months ago

On the back of selling Lukaku for £75m and not signing a new striker....

 

[Number4.]

We spend world record free for a defender a mere six months ago

On the back of selling Lukaku for £75m and not signing a new striker....

& gave an average keeper (Based on form over a 20 month period) a £117m contrant - it's insane

 

[Apokalips]

We spend world record free for a defender a mere six months ago

Exactly, and it's not as if he was some once in a lifetime player where you'd near bankrupt yourself to get him on the books.

Ole is also one of the best paid managers around despite the fact we could have paid him a lot less money and it would still have been a large raise for him. Hardly screams money struggles to me.

 

[krautrøck]

Didn't know where to put this: https://www.football365.com/news/europes-biggest-net-spends-since-2015-liverpool-29th

Interesting numbers.

 

[devilish]

The difference is United bring in a lot of cash, the mansion in your comparizon doesn't. Glazers doesn't have to put in own money into united, they can keep mismanaging the club and still take out a nice "bonus" every year. They will only start to think about selling the club when they see it's more profitable to sell than not to sell. And even then their egos will stand in the way at least for while, being the owners of the "biggest club in the world" is probably a giant ego booster for them.

You seem not well versed in renting properties. A property will generate money if rented. However wear and tear will occur especially if you had the misfortune of having a bad tenant. Thus money need to be kept aside to renovate the place and cover expenses else your place will become a dump thus reducing its rent potential. For example I just renovated one of the apartments. I removed everything (tiles, bathrooms, furniture) and bought everything from scratch. That costed me a bomb but now I am renting it for twice the money.

United is like a huge mansion whose interiors were a bit dated. Instead of getting the revamp it needed, its owners took all the cash and they spent as little on renovation as possible. A series of unfortunate events (ie bad handy men) made things worse as the interiors were damaged during maintenance. Now the place need huge renovation and the owners can't afford it.

 

[Green_Red]

This season is a reboot. We identified deadwood and shipped them out. This season was about seeing whether the structure and players under the dead wood were sufficient. We have definitely identified the deficiencies in the team this season and where we need to spend. It could be a simple case of waiting until the summer when we're more likely to pick up better players for the money we are willing to spend.

I think of the steps required to change a culture in an organisation. Simplified;

(obviously the very first step is outlining a plan and what type of culture you're going to try to create and what traits people need to have in order to create that new culture)

1. Identify who is either surplus to requirements / unwilling to buy into the new approach and remove them
2. Allow the remaining people to demonstrate their ability to progress within the organisation
3. Repeat step 1.
4. Identify new recruits that fit the new culture
5. Repeat steps 1 through 4 until the culture has changed

I am sure at a business level the club will have a long term plan, they'd have to, its a massive business and they will be hiring some of the best people in their fields. But the type of change they are trying to oversee is a massive challenge even to the very biggest organisations. It's a subtle game of tweak here, tweak there, and try not to bring the whole house down whilst your at it. But the goal is to make the smallest tweaks that bring the biggest rewards, which is very difficult.

At this stage I would imagine their main concern is, yes bring in some players, but also let's bring in someone that doesn't just cover us now with our injury crisis, but bring in someone that will be in the starting XI come next September. That's not that easy to do in January.

 

[bosnian_red]

Didn't know where to put this: https://www.football365.com/news/europes-biggest-net-spends-since-2015-liverpool-29th

Interesting numbers.

Yes we poorly recruited and spent a lot in the first few years post Sir Alex. And now the last 2 years we stopped investing much into the team. Since summer 2018, we've been outspent by the likes of Arsenal, Wolves, Brighton and Aston Villa in the premier league alone. City outspent us this window after winning 2 titles (and setting records) in a row. Liverpool spent our combined total since summer 2018 in 2018/19 alone, because they wanted to be successful. Chelsea outspent us last season. Spurs spent basically the same as us this summer. Everton outspent us last season. West ham outspent us last season. Bournemouth outspent us last season.

Its fecking Man United. One of the top clubs in the world in terms of revenue. One of the biggest commercial giants in the world. If we are in a period of transition, we should be at the top of these lists every year until we get it right. Not being outspent at some point over the past 2 years by the entire fecking league. Its ridiculous.

 

[red thru&thru]

Has anyone addressed that we do have financial restrictions?

 

[El Zoido]

Didn't know where to put this: https://www.football365.com/news/europes-biggest-net-spends-since-2015-liverpool-29th

Interesting numbers.

Highlights again the need for a DOF and a proper football/club structure. Letting each manager do what they want is ridiculous and unsustainable.

 

[Blueman]

Has anyone addressed that we do have financial restrictions?

I was wondering that. Are United earning so much that they can spend yet even more?

 

[golden_blunder]

This is correct. We’e already spent our money, and we spent it unbelievably poorly.

From here on out it will be a process of trying to continue to lower the wage bill and pick up two or three players at reasonable prices each year.

This seems to be the sad truth. We are going to have to go back to basics, development of our own players, buying cheap. Where we need to spend is to get the best coaching team that we possibly can and get them to prove that they can coach and develop a team into challengers. Sadly the current coaching team does seem to be the cheapest team, not the best coaching team

 

[billybee99]

Does anybody else feel that United have some serious financial/cashflow problems that we aren't aware of? The constant and somewhat silly fretting over player's prices? The ever-growing amount of debt that the club (not the Glazers) are saddled with?

That's the only logical reason I can think of (not signing anyone) when it is so patently obvious that we need fresh players in the squad. I just don't buy the guff about there not being any players available because it is January. If United wanted a player, they sure as feck could go out and buy that player (or at least so I once thought).

This whole schtick about them changing transfer policy doesn't sit well with me and I am greatly concerned that we could go the way of Leeds if things continue on as they are....

Slabhead and AWB say hi.

 

[DoomSlayer]

This is correct. We’e already spent our money, and we spent it unbelievably poorly.

From here on out it will be a process of trying to continue to lower the wage bill and pick up two or three players at reasonable prices each year.

Facts. Woodward and all the people involved should be sued for gross incompetence, it's like a financial scheme to take as much money out of the club as possible.

 

[Josep Dowling]

We have money problems due to bad decisions at a time where football transfers have inflated and agents now have too much say in transfer negotiations. We are being shafted from all fronts - our incompetent chief executive, the market and agents saying no to transfers unless they get hefty fees themselves.

We have spent £80+ on Pogba, Maguire and Lukuku. All three were overpriced. One we have sold for a loss, one has frankly had an average season so far, and the other is injured, has an agent who has far too much to say and doesn't want to be here. That is £240m alone wasted.

This doesn't even factor in buy the likes of Zaha for £12m, only to write him off 18 months later and sell a young British talent for just £2m with no buy back clause. What other big club does this? Palace are now asking £70m for him 5 years later and he would play in our starting 11.

Poor decision after poor decision. Even Smalling and Sanchez going out on loan, why haven't they been recalled given our issues in the squad? They apparently have no recall clauses in their contract! It's so basis it's unbelievable.

 

[Tel074]

We shouldn't what? We spend almost all our revenue every year, we can't actually increase our spendings without borrowing and any United fans should know that spending doesn't make things better since we are outspending(wages and transfers) pretty much every clubs not named Barcelona and Real Madrid.

To put it simply, when you buy a car you add expenses to your budget, you have to pay for an insurance and fuel, these costs will reduce your ability to spend in the future unless if you find new sources of revenue that increases your budget. It's the same thing for a football club with players being the cars.

What a load of bollocks. Are you talking about Bournemouth or Man United ? United could spend way way more than they have last summer and certainly more than we have spent this January window . If we had owners who where actually interested in competing then we would have made signings this window instead we are looking for loan players.

 

[entropy]

I don't think we are in any serious financial trouble per se. This is a long shot but maybe the owners have lost faith in Ed. Maybe they are looking to get rid of him in the summer and bring in someone else they feel will turn it around for us.

 

[red thru&thru]

This is correct. We’e already spent our money, and we spent it unbelievably poorly.

From here on out it will be a process of trying to continue to lower the wage bill and pick up two or three players at reasonable prices each year.

This is true. But it will only be the case till the Alibaba and new shirt sponsorship deals come in. We should be in a decent place again after that.

 

[TwoSheds]

We have money problems due to bad decisions at a time where football transfers have inflated and agents now have too much say in transfer negotiations. We are being shafted from all fronts - our incompetent chief executive, the market and agents saying no to transfers unless they get hefty fees themselves.

We have spent £80+ on Pogba, Maguire and Lukuku. All three were overpriced. One we have sold for a loss, one has frankly had an average season so far, and the other is injured, has an agent who has far too much to say and doesn't want to be here. That is £240m alone wasted.

This doesn't even factor in buy the likes of Zaha for £12m, only to write him off 18 months later and sell a young British talent for just £2m with no buy back clause. What other big club does this? Palace are now asking £70m for him 5 years later and he would play in our starting 11.

Poor decision after poor decision. Even Smalling and Sanchez going out on loan, why haven't they been recalled given our issues in the squad? They apparently have no recall clauses in their contract! It's so basis it's unbelievable.

There's no recall clause because Ed doesn't want to pay their wages. I think he's quite happy chugging along with a young squad on rubbish money. I think McTominay is on £10k a week for example unless he's renewed recently?

Also, feck getting Sanchez back. I hope he stays on loan for as long as possible, much as I liked him as a player a few years ago. His wages are too high for his 2 goals a season.

 

[Number4.]

What a load of bollocks. Are you talking about Bournemouth or Man United ? United could spend way way more than they have last summer and certainly more than we have spent this January window . If we had owners who where actually interested in competing then we would have made signings this window instead we are looking for loan players.

This is a massive assumption; there is nothing to show that they can.

Suppose they decided to invest in 3 more last summer - you are probably talking about somewhere around the 200m (amortised over 5 years) plus wages of around 30m per year for the three. There is no indication that the balance sheet can take 70m per year for 5 years, without selling more. There is too much overpaid dead wood at the club & they are naturally not going to drive transfer value when selling because of their wages.