How does a company like FC Barcelona enter a financial crisis?

This is going to be my first publication in LeoFinance completely in English, which is not my mother tongue so from now on I apologize for any mistakes I may make in the translation, having said that, today I come to talk about two topics that I love and That for my benefit, they work well on my blog, finances and sports, and it is that it attracts my attention as my favorite club, FC Barcelona, has been plunged for some time in a deep economic crisis and I wonder: how does this happen? How bad does a management have to be to sink a club like that? And the most important: how come nobody noticed? I did a little research and today I am here to try to answer those questions.

Yes, it is true that 2020 was a bad year for many people, but Barcelona's problem did not begin in 2020 and everything that happened due to the pandemic, what it did was to further aggravate the situation, sports mismanagement has been brewing since 2015 and when Josep Maria Bartomeu resigned on October 27 of last year, many sighed in relief (including me) but you don't have to be a financial expert to realize the obvious, it left the club on the brink of ruin.

That is a somewhat exaggerated term, FC Barcelona is a very big club and that, at least economically, is going to come out of its crisis in the near future, but how is it possible to reach that point for an entity that earns hundreds of million euros per year ...

Bartomeu succeeded Sandro Rosell in 2014 and won the elections in 2015, he presented an ambitious project and at the beginning, it was quite good, champions of multiple titles came out and everything seemed to only go up, but it was not like that. Bad technical decisions were translated into bad sports decisions and that in turn, resulted in bad financial decisions, supported by very expensive signings that did not yield, something that began with Dembelé, then with Coutinho, who continues to generate losses today. to the club, and then with Griezmann who seems not to raise his head, also the sales have not been successful at all, practically they gave Luis Suarez and today he fights for the top scorer in the Spanish league with Atletico de Madrid, last year it was for him Oblivion in the Blaugrana team in almost every way, the team recorded a loss of 97 million euros due to the pandemic and doubled its net debt to 488 million, for this 2021 campaign it needs a total adjustment of 160 million euros and the successor of Bartomeu will need to do magic to achieve it, in his squad he has players with salaries that are too high for the performance they give, so selling them to make a profit is not as easy as it is. thinks, and above all, there is still the doubt of the departure of his greatest star, Lionel Messi, who, if he wishes, can leave FC Barcelona at cost 0.

For now, there have been two salary updates that have helped, but that do not solve the problem, even so it is a beginning, players will probably come out, Dembelé and Coutinho are, in my opinion, the most targeted on this issue, the sports project is necessary And currently, you don't see one, that's what they should work on, maybe 2021 will be a year of transition, both economically and sports, we will have to wait for time to pass and see how it turns out.

^{all images source's from FC Barcelona's Twitter official account}