How Much Money Does Real Madrid Have To Spend
How Much Money Real Madrid Have
How Much Money Does Real Madrid Have

The incredible amount of money Real Madrid have made in 10 years by selling academy products. It is no wonder that Madrid have the funds to spend so much money on more established senior players. Manager Age: 62 Years Appointed: Jul 1, 2021 Contract expires: Jun 30, 2024. The club is regarded as the wealthiest club in the world, with an estimated net worth of $5 billion as of July 2021. Real Madrid will go down in the books of history as one of the best teams in the world. The team has created so many talents over the years and has, therefore, created a successful career path for many people. So where does Real Madrid get all that money? As you might expect Madrid has several different revenue streams. TV Rights Unlike Premier League teams, Real Madrid (and Barcelona) are able to allowed to negotiate their own contracts. Real Madrid signed a five-year deal with Mediapro that kicks in with the 2009/2010 season. With five, or possibly six, games left Real Madrid are in the Champions League semi-final and in the tightest La Liga race for 30 years, two points off the top. Somehow, they could win a double.

Gap closes between elite and smaller clubs as league distributes broadcast revenues.

Posted: January 2 2019

By: Sam Carp

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Barcelona and Real Madrid have once again claimed the lion’s share of La Liga’s broadcasting revenues, according to the latest figures published by Spanish soccer’s top flight.

Reigning champions Barcelona received the highest amount for the second consecutive season, securing a whopping €154 million (US$175.8 million).

That figure amounted to €6 million more than fellow giants Real Madrid, who netted €148 million (US$168.9 million) for the 2017/18 campaign, while their cross-city rivals Atletico Madrid notched the third highest amount with €110.6 million (US$126.2 million).

In total, €1.326 billion was distributed between Spain’s 20 top-flight clubs, with seven per cent of that figure deducted due to obligations, including 3.5 per cent in compensation to clubs relegated to the second tier.

Report: Santander activates La Liga extension clause

Despite the sustained dominance of Barca and the two Madrid sides – who claimed more than 30 per cent of the amount handed out, the gap between La Liga’s biggest and smallest clubs has closed as the league continues to work towards a fairer distribution model.

Barcelona did, however, receive over three and half times more money than Girona and Leganes, both of whom received €43.3 million (US$49.4 million), the lowest amount distributed among La Liga clubs.

The revenues are shared in accordance with Spain’s Royal Decree Law of 2015, which saw La Liga stop selling rights on an individual basis and return to the collective selling of media rights. The ruling also dictates that TV money should be distributed in accordance with other social factors such as attendances and TV audiences.

When it comes to marquee signings in football, the idea of a boost in shirt sales is often raised as a financial benefit associated.

It is usually put forward by some fans - and even pundits - as part of the justification for a transfer fee or for the often significant salary of the big-name addition.

The theory goes that the buzz generated by the arrival of someone like Lionel Messi, Cristiano Ronaldo or Kylian Mbappe will bring a major windfall as more jerseys will be sold.

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Here's the thing: it's something of a myth. Sorry to shatter the illusion.

So how much money do football clubs make from shirt sales then? Goal takes a look at the process in order to shed a little light on the matter.

How much money do football clubs make from shirt sales?

The money football clubs make from shirt sales varies from club to club based on factors such as how many shirts are sold and the commission rate they have negotiated with providers.

Even the biggest clubs in the world receive a relatively small percentage of the revenue generated from shirt sales - usually around 7.5 to - if they're lucky - 15 per cent.

There are some exceptions, of course. Liverpool's new five-year £150 million ($200m) deal (£30m a year) with Nike reportedly sees them take a 20% commission from sales.

Nike x Liverpool FC 😍
The Premier League champions unveil their new home kit for 2020-21 📸 pic.twitter.com/uBbVfaklW2

— Goal (@goal) August 1, 2020

In Liverpool's case, imagine that one million shirts are sold in the 2020-21 season at a cost of £80 each. Twenty per cent of £80 is £16, therefore Liverpool would pocket £16 million from those sales.

That would be £16 million on top of the £30 million Nike paid them that year as part of their partnership, with Nike getting £64 million from sales (though production and distribution costs would eat into that).

So why is the return from shirt sales so small, relatively speaking?

Well, it is because the production of kits is essentially a licensing arrangement. Kit providers such as Adidas, Nike, Puma et al pay a club for the right to produce and sell merchandise.

On top of the licensing fee, these providers then give the club a cut of the sales, usually once they pass a certain threshold.

Milan's 2020-21 Puma home kit is here 🔴⚫️ pic.twitter.com/zLj8kh8eIQ Are there any real ways to make money online, free.

How Much Money Does Real Madrid Have To Spend

— Goal (@goal) July 28, 2020

The sportswear manufacturers do most of the hard work, after all, and so, in a business sense, they are quite entitled to take the bulk of the profits.

It is a mightily lucrative industry to get into. Adidas, for example, agreed a 10-year deal with Manchester United, which sees them pay the Premier League giants £750 million over the course of the decade.

However, according to Adidas CEO Herber Hainer, sales projections over those 10 years is £1.5 billion ($2bn), so it is easy to see why manufacturers are willing to fork out such massive sums of money for licences.

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How Much Money Real Madrid Have

Which football clubs sell the most shirts?

As you might expect, the most popular football clubs sell the most jerseys and the likes of Barcelona, Manchester United and Real Madrid are regularly at the top of the table.

Other clubs, such as Liverpool, Juventus, Chelsea, Arsenal and Manchester City sell plenty too, as do Germany heavyweights Bayern Munich and Borussia Dortmund.

How Much Money Does Real Madrid Have

According to statista.com, Manchester United were the best-selling club when it came to jerseys sold in 2018-19, while Planet Football observes that Liverpool jerseys were the most popular football jersey on Amazon in 2019-20.