Manchester United has just completed the first two transfer deals in Summer 2024 with contracts named Joshua Zirkzee and Leny Yoro. For the first time in many years, Man United's transfer policy has shown such decisiveness.
However, these are only superficial changes in the comprehensive reform of the Old Trafford team's unprecedented scale under billionaire Sir Jim Ratcliffe . British media revealed that Man United has announced the layoff of 250 employees before the new season starts. This is considered the first step in the Old Trafford team's effort to cut costs . Employees working at Man United appeared "angry and hurt" after the brief announcement by Jean-Claude Blanc, the team's interim CEO.
According to The Athletic, this round of personnel cuts by the Old Trafford team was actually predicted in advance. According to the latest statistics in March 2024, Man United's workforce reached 1,144 employees/month - the largest in the Premier League. Therefore, the new co-owners of INEOS, led by billionaire Sir Jim Ratcliffe, hope to cut 20% of the workforce in May with a voluntary stop work decision. Employees will receive their annual bonuses earlier if they decide to leave. However, very few people accepted the club's offer at that time.
This is considered a comprehensive reform of unprecedented scale at Man United, when all other departments and levels of the club are cut. Only the Manchester United Foundation (the club's charitable arm) is unaffected. In addition, INEOS also canceled the company's credit card and advised team employees not to overspend on basic things, such as office supplies.
Not only that, the staff at Man United also had to contribute their own expenses to the party after the FA Cup championship. Similarly, no money was deducted from the team's fund to organize a farewell ceremony for the outgoing senior management board members.
As described by The Athletic, Sir Jim Ratcliffe and INEOS directors explained the changes at the team as "a right-sized adjustment" - a euphemism for cutting personnel. Basically, this is a step First, to restructure the company to better meet business needs.
In fact, "appropriate scale adjustment" was applied by INEOS when it acquired Innovene Petrochemical Company with a value of 6. 9 billion pounds at the end of 2005. This method helped the company considered young in the petrochemical industry by Sir Jim Ratcliffe at that time to become the third largest company in the world.
Immediately after owning Innovene, the British billionaire made a surprising decision when deciding to close this company's Global Headquarters in Chicago, USA - which had just opened 7 months earlier. Other offices in Lisle, Illinois and Staines in the south of England were also closed one after another.
According to the company's report, this is part of a restructuring program to bring Innovene in line with the "business strategy" proposed by INEOS. Over the next 7 years, INEOS spent about 220 million Euros to cut staff, mainly severance pay and early pension payments to former employees.
Although the staff reduction faced criticism from the team's own staff, it was a necessary measure to help Man United avoid future debts. According to the announcement of business results for the third quarter of the fiscal year, Man United lost 76.9 million pounds at the end of March. The loss before tax even reached 89.2 million pounds. Notably, the last time the Old Trafford team announced a profit was at the end of 2019. Since then, The Red Devils' total loss is 331.1 million pounds.
The Athletic revealed that Man Utd is currently having to spend more than 1 million pounds in interest each week on debt in the third quarter of last season. In other words, the £420,000 fee received from Girona in the Van de Beek sale will go towards paying off these debts.
It's too early to evaluate whether billionaire Sir Jim Ratcliffe and his team can help Man United return to its past position? However, the restructuring of the team and changes in transfer policy are bringing positive signals to Man United before the 2024-2025 season.
