Liverpool Football Club Flag
A Liverpool Football Club flag hangs outside of the Murfreesboro Party Fowl as members of The Middle Tennessee Liverpool Football Club gathers to watch a game against Norwich on Friday Aug. 9, 2019. 12 Liverpool Football (© HELEN COMER/DNJ via Imagn Content Services, LLC)

Manchester United and Liverpool are expected to be the biggest losers due to the pandemic this year. While the massive loss of income is terrible for clubs across the world, it makes sense that the two most popular clubs in the UK stand to lose the most due to a combination of games being played without fans, along with a decline in TV revenue and retail sales.

However, does this mean that Manchester United and Liverpool will actually materially suffer the most from this income loss? Not necessarily.

Liverpool’s problems

We’ll focus on Liverpool for this piece as they are the reigning Premier League champions and should be enjoying the financial fruits of their labor. Normally, the Premier League champion is in line for about £150 million, but Liverpool won’t see nearly as much of that this season due to the loss of revenue across the rest of their business.

The talk all summer was about Liverpool’s ownership, Fenway Sports Group, and their seeming unwillingness to spend any money in the transfer window. Up until last week, the only transfer that had been made was for backup LB Kostas Tsimikas. Meanwhile, Chelsea was spending hundreds of millions on the combination of Timo Werner, Kai Havertz, Hakim Ziyech and others. To Liverpool fans, it seemed that FSG were sitting back and counting their profit from winning the title, instead of re-investing into a squad whose core players are nearing their 30s.

Some financial experts who broke down the fact that despite Liverpool’s success, the club wasn’t rolling in money. They have one of the most expensive wage bills in the world. Instead of spending on new players, Liverpool reinvested profits into the existing squad. While this strategy has been beneficial in recent seasons, it’s also evident that the team needed reinforcements.

Fingers were being pointed towards FSG and their supposed tight-fistedness. It didn’t help that the other professional team FSG owns is the Boston Red Sox, who are currently in the midst of a rebuild that involves shedding salaries at a rapid rate. The team’s Twitter account even took serious heat for a tweet regarding the club getting under MLB’s luxury tax.

Solutions for Liverpool

But all of that talk disappeared immediately in the course of two days. On Friday, Liverpool brought in Thiago, a man widely considered the best in the world at his position, from Bayern Munich. On Saturday, they signed Diogo Jota from Wolves. The combined financial outlay for these two players was in the range of £70 million. Not bad for a team that seemed to be struggling financially.

It wasn’t as straightforward as transfers my have been in the past, when the big club with a lot of money could afford to overpay for a player they wanted. Liverpool will now have to sell off fringe squad players to make up for that financial hit. They are also on a payment schedule for these transfers instead of paying in a lump sum. The initial financial outlay for Thiago is only £5 million.

The pandemic has forced Liverpool to get creative, but it hasn’t slowed them down in reaching their transfer goals. Manchester United have been in a protracted negotiation for Borussia Dortmund’s Jadon Sancho, but that negotiation is for astronomical figures in the £90 million range. To even be in the market for a player at that price shows that the club isn’t teetering on the verge of financial collapse. It’s clear that whatever the losses from the pandemic are, they aren’t devastating to the major clubs.

The problems begin with the clubs at the lower end of the table. Many clubs in lower leagues are facing the prospect of bankruptcy. So, yes, Liverpool and Manchester United have been hurt by the pandemic, but don’t shed any tears for those rich clubs with billionaire owners and hundreds of millions of fans across the world. The real impact of the pandemic is on the clubs who were barely getting by before all of this hit.