Which part of the transfer market has your club been shopping in?

The Premier League has long been associated with big money signings and astronomical transfer fees. To compete in the English top flight, conventional wisdom goes, you must spend big in the transfer market.

Yet as the 20 teams competing in the Premier League this season finalise their preparations for the coming campaign, it’s immediately clear that different teams are shopping in radically different parts of the transfer market – and although transfer fees alone are far from ideal as a direct determiner of club performance given the range of factors that impact on the pricing of players, a review of the data over the last ten years does highlight some significant patterns that both help explain the current shape of the League, and highlight some real success stories over the last decade.

Harrods, Waitrose, or Aldi – where has your club been shopping?

Between them, the 20 sides competing in this season’s Premier League have spent over £5.5bn on transfer fees over the last ten years. But the distribution of this spend is heavily skewed to just a handful of clubs – Chelsea alone account for 17% of that £5.5bn figure; Aston Villa just 4%.

Chart one: Current Premier League clubs ranked by their gross transfer spend in the last decade 

Gross transfer spend

(source: http://www.transfermarkt.com)

And what’s more, the number of individual large scale transfers is surprisingly small. Of the 1,700+ players signed over the last ten years by clubs competing in the Premier League this season, around 170 (10%) had fees in excess of £10m attached to them. During the same period, these clubs have completed fewer than 50 transfers with fees in excess of £20m – accounting for just 3% of all deals done by the current crop of Premier League teams in the last decade.

What we see then, is that big money signings have been an extreme exception for the vast majority of clubs that are competing in the Premier League this season, and the ability to regularly shop in the ‘upper-mid’ and ‘high-end’ range of the transfer market has been the preserve of a relatively small number of teams, at the top of the division.

The chart below shows just how polarised the Premier League is in this regard. For 14 of the 20 clubs in next season’s Premier League, transfers of over £10m have accounted for less than 10% of all of their signings over the past ten years. More than a quarter of those clubs have not made a single £10m+ transfer during this period – unsurprisingly including those with little Premier League experience during this period.

Chart two: Club by club analysis of transfer fees paid for players over the last ten years

which part of market

(source: http://www.transfermarkt.com)

These teams have been shopping in the bargain basement when it comes to transfer fees compared to some of their Premier League rivals, particularly those teams that have been vying for the title or Champions League qualification during this period (and that most would expect to be doing so again next season), where the proportion of their transfers that are completed for ‘big money’ is between 25% and 40%.

What do these patterns of transfer activity tell us?

1) To be at the top, you need to shop at the top

It is no coincidence that the relative proportion of transfer business undertaken by Manchester United – the most successful Premier League club during this period – has been matched by Chelsea and Manchester City. Both clubs, fuelled by vastly wealthy foreign owners, spent the last decade aiming to catch and overhaul the established order in the Premier League.

By spending nearly double the amount of money on transfers as United, and focussing a high proportion of that spend on players recognised as being amongst the best in the world, they have largely been successful.

Given the signings of Costa, Fabregas, Fernando and Herrera already this summer, it seems very likely the same teams will be battling it out for the title once again.

2) Challenging the top four without spending big in the transfer market deserves recognition

Given that places in the top four of English football during this period have almost exclusively been the reserve of those teams that have spent big in the transfer market, those teams that over the past decade have managed to challenge those shopping at the top of the market deserve recognition.

The clearest example of this kind of over-performance can be observed in the red half of North London and the blue half of Merseyside. Arsene Wenger may come in for criticism for his poor trophy record over the last ten years compared to the likes of Manchester United, Chelsea and even now Manchester City, but in keeping the Gunners in the Champions League while spending a third of the amount of money on fees as those clubs, and until last season, all below the £20m mark, is remarkable.

Now that the Gunners have switched approach, and are firmly in the market for expensive signings at the top of their game, Wenger could yet have the last laugh over his detractors by mounting a sustained title challenge this year.

Likewise, while it may now be fashionable to suggest David Moyes should never have been appointed Manchester United manager, his record as Everton boss of consistently challenging, and on one occasion actually penetrating the top four in English football, despite recruiting almost exclusively below the £10m mark represented a fantastic record.

Now Roberto Martinez has successfully added £28m Romelu Lukaku to his Everton side this summer, he just might stand a chance of eclipsing his predecessor.

3) The differences in the scale and type of recruitment undertaken for the majority of other Premier League clubs in the last ten years are far smaller

Outside of the top six clubs on transfer spend, and those teams with little recent experience of the Premier League, the differences between the other clubs competing in the division are far less marked. The overwhelming majority of transfer business undertaken by these teams is focussed on players valued underneath the £10m mark – with clubs like Newcastle, Aston Villa, Southampton and Swansea typically competing in the mid to lower end of the transfer market to uncover hidden gems that can propel them forward.

Chart three: Analysis demonstrating the extent to which most teams in the Premier League do not shop for players in the £10m+ market

pie chart

(source: http://www.transfermarkt.com)

This in part reflects, and drives, the competitive nature of the Premier League outside of those clubs chasing Champions League football, and may even help explain the small gaps that exist between clubs battling relegation and those sitting in mid table. But critically, it means that the value of good quality scouting in as yet untapped markets, together with an ability and willingness to offer good wages and the chance of career progression becomes even more important for these clubs.

In essence, the likes of Christian Benteke, Jay Rodriguez and Yohann Cabaye could easily have been signed by any one of ten clubs, each competing for the best of the 0-£10m marketplace. At the same time, for every successful signing from this range of the market, many do not work out – for every Benteke a Kozac; for every Cabaye, an Anita. But for those clubs without the resources or will to match the big spenders in the division, identifying and taking measured risks on the potential stars of tomorrow, before the big boys discover them, is the name of the game.

Transfer fees can never tell the full story when it comes to explaining club performance over one season, or over ten. But they do give us valuable insight into some of the fundamental factors shaping the nature of the Premier League, the mini-competitions that exist within it, and the kinds of strategies clubs employ to try and improve their fortunes. Which market your club shops in, really does matter.

Trackbacks

  1. […] Click here to find out which part of the transfer market your club has been shopping in over the pas… […]

  2. […] and as demonstrated elsewhere by HRZ, the vast majority of players were transferred for less than £10 […]

  3. […] Which part of the market has your side been shopping in? […]

  4. Arly says:

    Arly

    Which part of the transfer market has your club been shopping in? – Hit Row Z

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