Claudius wrote:
You cover a lot but I would raise two important points on squad management and cash generation.
First is squad management. It’s worth moving some players now whether permanently or on loan to help Arteta have a smaller, more manageable squad. The remaining squad will be a smaller group who each have a higher chance of winning places in the matchday squad and starting lineups. Arteta talks a lot about culture. A large part of embedding a high performance culture is that people must feel that hard work is rewarded. A smaller team enables that. Clearing out louts also signals the importance of working hard.
Second is cash generation. We have not actually fully amortized Xhaka. When you extend a player, you amortize the new contract over what remained of his asset value at the time of his contract extension. From a cash flow perspective, however, whatever we sell him for is pure cash. So we do we want to find a way to maximize the sales of people like Xhaka and Lacazette and get as much $ as possible. Even if the money comes over several years, it is still cash. And that can be applied to strengthening the squad.
Agreed to point 1 - I'm not saying it shouldn't be done but that it should have been organised once it was known the players were to have been moved. These arrangements could have been made anytime during the season as the transfer window is only about player registration - same applies for any transfer/loan in or out.
My issue with this is that if we are to embrace the idea of a smaller squad with more internal competition, then why are we also looking at moving out such fringe players as Chambers & others who would benefit from increased opportunities = who is going to be the beneficiaries of any potential increase in minutes = Xhaka, Willian, Pepe, Mustafi?
As for cash generation & amortization I did refer to their initial transfer fee, whereas the amortisation on subsequent extensions is primarily about wages unless those extensions are made during the initial contract period, in which case any residual fee is again spread over the extended period. Yes it is possible for a player to still have a sum of amortisation of his initial transfer fee after 5 years, but the actual amount is likely to be less than the wages paid each season.
My point is that whilst it is correct in principle we are shutting the gate after the horse has bolted,& the financial benefits to be made during a depressed market are negligible IMO when compared to still paying those wages, let alone in terms of squad rebuild etc.
Bottom line for me it still indicates we are relying upon player sales to generate additional transfer revenues. I have no issue with this under normal circumstances as I have said we have used our revenues poorly for years. However under current circumstances where a team/squad rebuild is required, let alone with reduced revenues and a depressed market, then relying upon player sales is a futile exercise and the project is doomed before it gets going. The only thing that is going to improve is our operating costs as we reduce our wages, and thus we will improve our self sustainability, and then profitability once revenues start to improve.
This is all about the club as a revenue based business and SFA about the football team or capability.
EDIT - I also hope this ends talk KSE actually provided funds for the transfer of players last summer.
