Real Madrid’s financial prudency is on another level

Real Madrid, Florentino Perez (Photo credit should read VALERY HACHE/AFP via Getty Images)
Real Madrid, Florentino Perez (Photo credit should read VALERY HACHE/AFP via Getty Images) /

Real Madrid fans might have a lot of disagreements regarding Florentino Perez’s transfer decisions. Sometimes there isn’t really a lot of sporting vision behind his signings, and he does commit occasional mistakes in the transfer market. But if there’s anything no fan can deny, it is the fact that Florentino Perez never keeps the club’s financial stability at stake with his signings and even contract renewals.

The wage bill has always been under control, and the President never tries to lure players by offering astronomical wages. The board know that there is always a limit to expenditure, and the sales have always helped the club to generate funds. It is because of the board’s meticulous planning that the club was able to generate profits even during the pandemic, while also renovating the Bernabeu.

Now, we have further proof to talk about Real Madrid’s financial stability.

CIES football observatory has issued its 376th weekly post today, in which they have ranked the clubs of Europe’s five biggest leagues, as per their net expenditure in the transfer market. The list might shock the fans of other top clubs, but it won’t surprise any Madridista.

Real Madrid aren’t even in the top 20 of the list, standing at 25th

Yes, you read it right. 24 European clubs have a greater net spend than Real Madrid, a club that has been criticised in the past for its excessive expenditure in the transfer market.  There are 15 English clubs above Madrid, with Manchester United and their rivals across the city securing the top two positions.

They are closely followed by another state-owned club in Paris Saint-Germain, and Real’s fiercest rival, FC Barcelona, who have often taken a dig at Real Madrid’s transfer activity, and boasted about their reliance on their academy. Well, maybe it is the reason why they were on the verge of bankruptcy earlier this season.

Real Madrid did spend a lot. They have spent 1163 million euros in the last ten years, and these numbers are only inferior to the Manchester clubs, Barcelona, Chelsea, Juventus, and PSG. They signed Gareth Bale for a record fee in 2013 and signed Eden Hazard and Luka Jovic for a combined sum of 175 million euros. The club also spent more than 50 million each on James Rodriguez and Eder Militao.

But they have balanced the huge expenditure numbers with extraordinary sales. The club sold a 33-year-old Cristiano Ronaldo for 120 million and sold many more players like Alvaro Morata, Angel Di Maria, Raphael Varane, and Achraf Hakimi for reasonable amounts. Thanks to their excellent transfer planning, they stand fourth in the list of highest sales, cutting down the net spend to just -179 million. Not to forget they have always obeyed the financial fair-play rules.

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This only proves one thing. You can never point fingers at Florentino Perez’s business strategy. The club’s board has trusted a visionary, who might be the best at running a top football club.