The Pitch: The ‘fixed and variable’ factors blocking Salah and Van Dijk deals

We’ll examine later in the piece how Salah’s €1m+ per week image rights and salary composition - based around fixed and variable fees - were central to the eventual success of the negotiation strategy by both sides.

That three-year contract was an outstanding success - based on goals, assists and game influences - but it is coming to an end and just like the period before the summer of 2022, there is a significant blockage.

There is also a deadlock with Virgil van Dijk’s discussions at Anfield, a process likely littered with the same issues facing Salah and Abbas three years ago.

Van Dijk recently revealed that nobody knows, not even him, how this will end or where he will be next season.

One conversation which has all but ended is around Trent Alexander-Arnold’s future at the club, with Real Madrid the reported destination of choice for the full back this summer.

Should the unthinkable happen for Fenway Sports Group (FSG) and Liverpool fans, and Salah and van Dijk follow Trent through the Anfield exit, Liverpool will have allowed €158m in assets slip through its books. 

That money is based on analysis by The Pitch using current transfer values as assessed by Transfermarkt.

So too is the €350m in market value which Real Madrid has gained in commissioning players for free for its current squad, including Alexander-Arnold’s current €75m valuation.

This figure will increase significantly if the club manages to capture more players through its tried and tested model – there are rumours that Van Dijk may follow TAA, but as the Dutch defender has already said: "No-one knows." If he were to move to Madrid, he’d be moving to a club which has created a market all of its own in recent years – relieving some of the world’s leading clubs of their primary assets for nothing – with the only compensation paid through signing-on fees and salary packages for those stars. It has been a strategically successful way to do business for Madrid.

And it all seems perfectly legal, with no evidence – but lots of speculation - of players being tapped up long before the six-month limit expires on current deals. With less than half a year left on any deal, a player has the right to speak to other clubs, but not before.

Madrid’s mature version of Moneyball, where they sign established assets with no compensation to the former club, is a highly proactive version of prudential acquisition – a polar opposite of Liverpool’s highly risky ‘fixed and variable’ approach.

The current value of the Real Madrid squad sits at approximately €1.27bn – with €275m in assets having been brought in through its free transfer policy, where the Champions League winners have extracted supreme talent from some of the world’s richest and most successful sides, including PSG, Chelsea and Bayern Munich.

The most extraordinary business was done with the transfer of Kylian Mbappé last summer - the world’s most valuable player, with a market value of €180m at the time – with zero return for PSG.

To put this in some perspective, PSG’s annual turnover for Mbappé’s final season in Paris was €806m.

Antonio Rüdiger was spirited away from Chelsea two years earlier, when his value was assessed as being worth €40m, and David Alaba’s move from Bayern Munich in 2021 set the catalyst, when he retained a market value of €55m.

It’s not that Real Madrid has relied solely on such a valuable ‘no fees paid to the other club’ strategy, they still invest more than most on prodigious talent.

In 2023 Jude Bellingham signed from Borussia Dortmond for €113m, in 2018 Vinicius Junior signed for €45m on his 18th birthday, while in 2022 Aurélien Tchouaméni signed from Monaco for an €80m fee - despite an estimated market value of €60m.

So while Madrid have carefully cultivated and encouraged a highly valuable sector of the market, why then is a club seen as its rival – Liverpool – finding itself on the sharp side and increasingly unable to retain its top stars on contract?

Allowing the rights over Salah, Van Dijk and Alexander-Arnold to wind down certainly looks like a poor strategy by the Reds, but maybe it’s not quite that simple.

In the case of Alexander-Arnold - who will now earn approximately €15m per year - we are not privy to what was offered to the player in efforts to get him to commit long-term to Liverpool. There may have been offers and there are rumours of a commitment to a future captaincy, but it seemingly was not enough.

Social media and radio phone-ins have been filled in recent days with commentary that the player deliberately let his contract run out and that he owed the club. Dog-whistles by Jamie Carragher talking about a tarnished legacy have fuelled some of that anger, but the reality is that the player is exercising his absolute right in appreciating full value for his own stock, even if FSG haven’t. What FSG will have to determine, and quickly, is what sort of value it puts on its other, albeit more mature assets - van Dijk and Salah.

Both are playing as well as they have ever done, despite their age - the Dutchman will be 34 at the start of next season, while Salah will be 33. Based on recent history the biggest factor in determining whether they will sign new deals will likely come down to how those players will be paid for their new contracts, and how much the club will want to pay through fixed compensation.

Fixed and variable packages are the clearest indicators of how players are paid at top clubs, salaries guaranteed through set payments, or fees paid through performance-related models.

Players and agents prefer the guaranteed or fixed versions, for obvious reasons, and while a mix with the variable model work for some, injury and form can impact the bottom line.

We know from the Harvard study by Anita Elberse and Taher El Moataz Bellah that Mo Salah and Ramy Abbas Issa were involved in a long and protracted negotiation process with the club from 2020 to 2022, with the agent fearing at one point that the deal was on the brink of collapse.

A key issue then was how the player’s compensation package would be constructed with the club wanting Salah’s salary to be made up of a split between variable and fixed payments – in other words, performance-related fees and a guaranteed wages. This is likely why there has been no movement or progress on the Salah and van Dijk discussions, up to now.

Image rights were also discussed as a trade-off with Salah and Abbas, although we don’t know how far these discussions went. Salah owns his global image and marketing rights, conservatively estimated by Abbas as being worth between €54m and €62m per year in contracts with Adidas, Pepsi, Bank of Alexandria, Gucci and others.

Eventually a counter-offer was accepted by the club, with a deal of £350k per week agreed – money well spent and so far realising 64 goals and 39 assists in the Premier League and 16 goals and 10 assists in the Champions League throughout the lifetime of the contract.

With Salah now three years older – even if his performances are timeless – he will be in his mid-30s when any potential new contract expires, as will van Dijk who is currently on £220,000 a week.

With both players currently valued at €83m – Salah €55m and van Dijk €28m – Liverpool will know that to replace both will cost significantly more, but will also be mindful that extensions for both will only provide a short-term fix.

While FSG have got to be prudent, there is certainly evidence that its retention policy is becoming outdated as clubs like Madrid see such hesitancy as strategic opportunity.

The question for now is how much more can Liverpool afford to hesitate?