What the Premier League Needs to Learn from the Bundesliga

In the last part of this series about finances in German football, we will take a look at what the Premier League can learn about its own successes and failures and whether it should take any inspiration from how the Bundesliga and its incumbent teams are organised and governed.

While acknowledging that there are many positives from the way the Bundesliga is organised and administrated, it is also fair to point out, as Martin Samuel did in this excellent piece in the Daily Mail back in 2012, that the German football is far from perfect.

He points out that many German clubs at levels below the Bundesliga have gone insolvent or been punished for football financial irregularities many times over the past few years. Furthermore, other clubs such as Hansa Rostock and Alemannia Aachen have only been saved due to local authorities stumping up the cash to keep a club afloat (which does not happen in England).

Similarly, it is common knowledge that Dortmund were once on the brink of bankruptcy in the 2002-2003 season and were only saved by a £1.6m loan from Bayern Munich.

Moreover, Munich’s other side, TSV 1860 Munich were co-owners of the incredible Allianz Arena when it was built. Much was made of the fact that the stadium could be turned white for International games, blue for 1860 matches and red for Bayern’s games. Only now TSV 1860 Munich are no longer half-owners of the stadium having been forced to sell their half to Bayern Munich in order to pay off debts and stay afloat.

So it is important to recognise that while there are many admirable aspects of the Bundesliga model, not everything is quite as perfect as many experts, including FIFA President Sepp Blatter, would have you believe.

That said, there is still much admire about the Bundesliga that, when applied elsewhere, would certainly improve the economic viability, not to mention competitive nature of the Premier League. Here’s some of the key principles that the Premier League would do well to learn from the Bundesliga.

1. Put the Fan First

This principle may be a pipedream, but the Premier League’s treatment of football fans is generally very poor. In comparison to Bundesliga fans, fans who attend matches in the Premier League pay a vastly inflated price for that privilege.

Quite simply the cost of single game and season tickets in the Premier League, at an average of over £500, is excessive.

What is particularly galling, is that while the Premier League ceaselessly seeks ways to encourage female fans, families and spectators from demographic outside that of a typical English football fan, any initiative the big-decision clubs could take to encourage this type of fan through the turnstile, they just will not contemplate for a reason for that is simple: a large loss in revenue from the turnstiles would put many clubs in danger of posting dangerous losses every season. Indeed, many clubs are already in this position so reducing entrance fees considerably, to be even on a par with the Bundesliga teams, is entirely unthinkable in England.

It is also unlikely that anything like the 50+1 Rule would ever be invoked in the Premier League. Too many powerful individuals now own too much power at key clubs and the costs involved in a fans group purchasing the required number of shares to obtain even a single seat on the board, let alone a majority shareholding, is unthinkable.

However, the Premier League needs to find a compromise that doesn’t allow wealthy owners to bankroll a clubs success beyond a business model that is not self-sustainable. At the moment, several huge clubs are entirely reliant on the benevolence of their owner not just to fund purchases, but to write off existing loans or offer the facility at a reduced rate, in order for them to remain competitive.

FIFA’s financial fair play initiative was supposed to make this happen; however, the fact that two big clubs Manchester City and Paris St Germain have flagrantly broken these rules and received only a pittance of a punishment (a fine for either club, who have almost limitless financial resources – is no punishment at all).

Therefore, if the Premier League cannot adopt the 50+1 Rule, then it needs to at least adopt something similar. Giving fans a clear and consistent voice on the board would be a start, offering huge reductions for family tickets (rather than simply a few pounds) would also help.

Unfortunately, the pursuit of the pound makes such suggestions eminently unlikely given that the Premier League is now generally about money, rather than the welfare of the fan.

Other ideas could include the adoption of a similar system in Germany where public transport is free for football fans on matchdays (though how this would be subsidised would be an issue), the setting up of similar “Fan Projekt’s” at all clubs, which would allow fans a greater contribution in the decision making process regarding key issues the club needs to address.

2.  Focus on Academy Players and Home Grown Talent

In the Premier League during 2012-2013, just 36.5% of the players who played in the competition were English. This fact means that young talented English players either face sitting in the stands, playing reserve team or academy football or being loaned out to clubs across the globe in order to develop their talent.

In the Bundesliga over the same period, 50% of the players were German, but what was noticeable here was that the top two teams in the Bundesliga at this point, Bayern Munich and Borussia Dortmund had a large percentage of top German players playing for them. Compare that with teams in the Premier League such as Chelsea, Arsenal and Manchester City in particular who tend to field teams often with just one or two, or occasionally no English-born players.

German clubs also invest heavily in their youth football at both domestic and national level. Players are brought up in these systems and not moved along until they are both old and talented enough. This is evident in the successful German World Cup team, which featured 6 players in the starting 11 who won the U20 title back in 2009. In contrast, just one player from the England team who faced them in that final five years ago, made it to the England squad for the World Cup in Brazil.

German football adopted a new philosophy in the wake of their poor performances at the turn of the millennium and it has taken 14 years to reap the ultimate rewards. Yet almost 50 years after England last won the World Cup, we have still not invested enough time, money or faith in our young players and we still ask our young players to do too much, too soon with the focus being entirely results driven, rather than on player development.

That is a fundamental that Germany got spot on and which English football at all levels, has yet to embrace fully.

3. Player Wages

When you view the accumulated wealth of the Premier League and Bundesliga together, there are strong similarities in many areas of revenue; however, the Premier League secures has a much larger TV deal, but to counteract this advantage, and by some considerable distance, the Premier League also pays out vastly more in wages every season. Typically, the 18 Bundesliga clubs have a wage bill half that of the 20 teams in the Premier League.

The truth of the matter is, it is excessive player wages that are driving up the cost of Premier League football both for TV companies, sponsors and the football fan.

The problem is that there is no simple answer to this issue. With other clubs across Europe such as Real Madrid, Barcelona and now Paris St-Germain and Monaco, as well as Bundesliga giants Bayern Munich and Borussia Dortmund all offering hefty wages for star players, the going rate for the elite will always be high.

Where the Premier League, however, have it wrong is that players of considerably lesser ability are now receiving salaries that are vastly inflated compared to their worth for the club. Many teams pay at least a significant percentage of the wages of players who are out on loan at other clubs. The average Premier League footballer now earns over £31,000 a week. This average includes youngsters who have not even kicked a ball for the first team.

It is this type of wage inflation which is the issue. Few fans have a problem with their club paying £200,000 a week for players of the calibre of Marco Reus, Gareth Bale, Cristiano Ronaldo or Neymar. However, when players like Joe Cole (who in his forgettable time at Anfield still pocketed over £100,000) or 17 or 18-year-old youngsters are regularly being offered deals at £20,000 a week, then that is what fans get most irate about.

Capping wages is the only sensible solution, but it will never happen because it would not be in the wealthiest clubs self interest to do so. Until the power shifts away from these elite clubs, back into the hands of the masses of lesser clubs and fans, the divide will just get wider.

The problem the Premier League has is that even if it wanted to follow aspects of the Bundesliga, the structure of the league and the power individual clubs have within it, mean that such proposals would never stand a chance of success. If forced through, then this would only exacerbate the likelihood of a European Super League forming.

However, the worrying thing for fans of the game in all countries is that, Bundesliga apart, many leagues are now reaching breaking point in terms of revenue and wages. The culture of greed cannot continue indefinitely.

So while English soccer may need to learn a few home truths about how to build successful football clubs and national teams, it also needs a healthy reality check as the Premier League monster, could destroy the game it was designed to save.

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