Swissramble vergleicht FCB / BVB 2022/23
Following Bayern Munich’s shock defeat to Mainz last weekend, they have been overtaken by Borussia Dortmund, who now lead the Bundesliga. Although second place would be regarded as a fine achievement by most clubs, this is certainly not the case for Bayern, who are seemingly in crisis mode.
Questions are being asked about their new manager Thomas Tuchel, who only replaced Julian Nagelsmann last month, and also chief executive Oliver Kahn and sporting director Hasan Salihamidzic.
For some context, Bayern have won the Bundesliga for the last 10 years in a row, so anything other than victory would be regarded as a failure. The last time that they did not win the title was back in the 2011/12 season, when they were beaten by Dortmund.
Part of the reason for Bayern’s imperious record over the last decade is their financial power, so I thought it might be quite interesting to see how Dortmund compare to the Bavarian giants off the pitch.
Overview 2022
In 2021/22 Bayern reported a €17m pre-tax profit in contrast to Dortmund’s €33m loss, mainly because their revenue is significantly higher than their rivals, partially offset by Dortmund’s better profit from player sales. Bayern’s cost base is also much higher.
As Jan-Christian Dreesen, Bayern’s finance director, observed, “This is a strong result. Hardly any other top European club has been able to consistently report profits like FC Bayern, despite the pandemic over the past three years.”
Profit/(Loss) before Tax
In fact, Bayern have now been profitable for an amazing 30 years in a row, including €361m in the last decade alone. Profits have been lower in the last three seasons, due to COVID restrictions, but other clubs would still be envious of their results.
Dortmund had also made money for nine consecutive seasons up to 2019, though they have posted losses in each of the past three years, partly due to the impact of the pandemic, partly as they strive to compete Bayern. Their losses in this period added up to €153m, reducing their overall profit since 2013 to only €27m, less than a tenth of their rivals.
Operating Profit/(Loss)
At the operating level, i.e. excluding player sales and interest payable, the gap was even higher. Dortmund have posted large losses from day-to-day business for the last seven years, averaging €67m a year in this period.
In contrast, Bayern have generally managed to generate an operating profit, also restricting the size of their losses during the COVID seasons. In 2021/22 their €9m profit was exactly €100m better than Dortmund’s €91m loss.
Profit from Player Sales
Dortmund’s business model is to try to offset operating losses with profits from player trading. In this way, they have generated nearly half a billion Euros (€472m) since 2013, including €435m in the last seven years alone.
There have been numerous big money sales, including Jadon Sancho and Henrikh Mkhitaryan to Manchester United, Ousmane Dembélé to Barcelona, Christian Pulisic to Chelsea, Pierre-Emerick Aubameyang to Arsenal and Mario Götze to Bayern.
The sale of the prolific Erling Haaland to Manchester City will be included in the 2022/23 accounts, but this is unlikely to be the end of the story for Dortmund. Indeed, the club said that there were “some very lucrative transfer deals in the offing”, which is probably a reference to the huge gain they could make by selling the exciting England international, Jude Bellingham.
Bayern have been nowhere near so active with their €270m profit from player sales in the last 10 years being around €200m less than Dortmund. Indeed, their gain was only €7m in 2021/22. This is basically because Bayern don’t need to make money here, as they are already doing just fine with their normal operations.
Until this season, the highest transfer fee received by Bayern was only €40m for Douglas Costa from Juventus, though a new club record was established last July when Robert Lewandowski moved to Barcelona for €45m.
Revenue
Bayern’s €653m revenue is nearly €300m more than Dortmund’s €357m. They are ahead in all three revenue streams, especially commercial, where the gap is over €200m.
As a technical aside, this revenue is using the Deloitte Money League definition, which is different from the club accounts. Bayern reported €666m in 2021/22, including income from player sales, while Dortmund’s €352m was €5m less than Deloitte’s figure.
Bayern dropped three places from 3rd to 6th in the Money League, which ranks clubs globally by revenue. Similarly, Dortmund fell one place to 13th. The only other German club to feature were Europa League winners Eintracht Frankfurt in 22nd place, whose revenue was around €150m less than Dortmund.
The revenue gap between Bayern and Dortmund is simply enormous. It had been narrowing (slightly) in the last three years, but the current difference of €297m is close to the all-time high of €308m in 2017/18.
What is quite striking is how flat revenue has been for both clubs. In fact, revenue has actually fallen since the pre-pandemic highs: Bayern are down €6m (1%), while Dortmund have decreased by €20m (5%). This is partly because there were still some stadium restrictions in place in Germany last season.
Looked at another way, Bayern’s €654m revenue was over 80% more than Dortmund’s €357m, which is a massive difference between the first and second ranked clubs in a country. This is far more than the gap in other leading countries with the exception of France where PSG are in a class of their own financially.
Match Day Revenue
Match day revenue has been greatly impacted in Germany by the COVID pandemic in the last three seasons. Almost all games were played behind closed doors in 2020/21, while even 2021/22 saw restrictions on the number of fans allowed to attend the majority of matches.
The last season pre-pandemic was 2018/19, when Bayern’s €92m match day income was 55% more than Dortmund’s €60m. Revenue was obviously lower last season, but the gap was more or less the same at €30m.
German clubs attract high crowds, thanks to a combination of great football tradition and low ticket prices. Dortmund’s average attendance this season is over 81,000, the highest in the Bundesliga, 6,000 ahead of Bayern’s equally impressive 75,000.
Broadcasting Revenue
Bayern’s broadcasting revenue has consistently been higher than Dortmund, mainly due to better results on the pitch. Last season was no different, as Bayern’s €207m was €62m more than Dortmund’s €145m.
In this way, Bayern earned €90m from the Bundesliga TV deal last season, which was €10m more than Dortmund’s €80m. There was hardly any difference in the two clubs’ payments from the domestic deal, but Bayern received €9m more than Dortmund from the international element.
To place this into perspective, the total payment was lower than the club that finished last in the Premier League in 2021/22 (Norwich City), who received €114m TV money, which was around 25% more than the German champions.
The model used to distribute Bundesliga TV money changed in 2021/22, primarily to provide more stability to clubs during a period of uncertainty. As a result, a significant slice is now given out via an equal share: 53% of the national deal and 35% of the international deal.
However, there is still a substantial element based on performance:
- National deal 42% - split between last 5 years of Bundesliga 1 (24.5%), last 5 years of the total Bundesliga (17%) and last 10 years (0.5%).
- International deal 65% - split between last 5 years of Bundesliga 1 (50%) and last 10 years (15%).
There are two further elements in the national deal:
- Young talent 3% - based on minutes played and share of training for U23 players.
- Interest in club 2% - based on the Allensbach Media Market Analysis.
The current Bundesliga TV deal is worth €1.25 bln in total (domestic €1.079 bln, international €171m). This is 13% lower than the previous deal, which was worth €1.44 bln, though league representatives thought that this represented a good outcome in the circumstances (negotiated during the pandemic).
Even after the decrease, the Bundesliga TV deal of €1.25 bln remains the third best in Europe, but it is less than a third of the Premier League’s incredible €3.9 bln and also a long way below La Liga’s €2.0 bln.
Europe TV
European TV money has provided a big competitive advantage to Bayern over the years, especially in 2021/22 when they earned €110m from the Champions League, which was €46m more than Dortmund’s €64m.
In fairness to Bayern, their earnings were boosted by more success on the pitch, which led to much higher prize money. They won all six group games and got to the quarter-finals, before surprisingly losing to Villarreal. In contrast, Dortmund failed to get out of their group.
After dropping down to the Europa League, Dortmund received another €2m, as they were immediately eliminated in the knockout round by Rangers.
An important differentiator for Bayern is the UEFA coefficient payment, which is based on performances in Europe over the last 10 years. The Bavarians have the second best ranking in Europe, only behind Real Madrid, which earned them €35m. Dortmund also did well here, though their €26m was €9m lower than Bayern.
Bayern’s European TV money was also boosted by the TV pool, as their €21m was €10m more than Dortmund’s €11m. This is split into two elements:
- The first half is based on a club’s position in the previous season’s Bundesliga. Bayern’s first place was worth 40%, while Dortmund’s third place only gave them 20%.
- The second half is based on progress in the current season’s Champions League. Bayern’s quarter-final gave them 36%, compared to Dortmund’s 21% for the group exit.
In the last five years Bayern have earned nearly half a billion Euros (€481m) from Europe, which is a substantial €176m more than Dortmund’s €305m.
Commercial Revenue
Both Bayern and Dortmund set new club records for commercial income last season. However, Bayern’s €378m was over twice as much as Dortmund’s €174m with the difference being over €200m.
In fact, Bayern have the second highest commercial revenue in the world, only surpassed (just) by PSG’s €383m, but ahead of clubs like Manchester City €373m, Real Madrid €318m, Manchester United €309m and Barcelona €284m.
Bayern have a veritable raft of big money sponsors. Shirt sponsor Deutsche Telekom has been extended to 2027, increasing the annual payment from €45m to €50m. Similarly, they have long-term deals with kit supplier Adidas (€60m to 2030), car partner Audi (€50m to 2029) and stadium naming rights (Allianz €10m). In addition, they have a €10m sleeve sponsorship with Qatar Airways.
Dortmund have a couple of innovative split agreements with one sponsor for the Bundesliga and one for UEFA competitions and the DFB Cup: shirt sponsorship €35m (1&1 and Evonik) and sleeve sponsor (Opel and GLS). Their €30m kit supplier deal with Puma runs to 2028, while the €6m stadium naming rights with Signal Iduna have been extended to 2031.
The largest shirt sponsorship in Germany is actually with another club, namely Wolfsburg, whose owners Volkswagen pay them a princely €70m a year.