Athlete Contract Management Costs Professional Soccer Teams Precious Time

Teams are spending more time administering and managing athlete contracts than they do competing.

By: Gina Timm

Soccer is one of the largest and most popular sports in the world. Thousands of new soccer players make the leap to professional leagues each year. This means contracts need to be negotiated, administered and managed. Today, the contract management process is a cumbersome one, filled with redundant procedures. It consists of email overload, faxes, pdf documents, and in some cases snail mail. Revisions to contract terms, coupled with complicated version tracking, results in the inevitable existence of multiple copies of the same document. The administration and reconciliation overhead of managing all these contract documents can be an expensive, time-consuming course of action.

The USA based, Major League Soccer (MLS) has 652 athletes professional athletes that must sign professional contracts. The administration overhead of finalizing a contract is hard to quantify, but let’s make some assumptions to see where the numbers might take us.

To start, let’s assume that the contract negotiation follows a process like the one below:

1. Initial contract drafting.
2. Communication of current terms to all relevant parties (Club, Federation, Athlete & Agent).
3. Documenting amendments/revisions to the contracts within rules and regulations of league → mainly Salary Cap Restrictions.
4. Agreement of new terms by all parties.
5. Updating contract with new terms,
6. Repeat steps 2–5 until terms are all parties are aligned
7. Signatories from all parties on the same contract.
8. Distribution of signed contract to all vested parties

Let’s start by making some assumptions for the MLS:

• There are 652 players in the MLS, at some point, they each had a contract administered and signed.
• The initial contract documentation requires 2 administrative staff who each spend 4 hours drafting the initial contract document.
• Revisions to the contract require 2 administrative staff who spend approximately 2 hours each.
• On average 2 revision(s) are made to each contract.
• Average MLS game is 2 hours

While these numbers may not be an exact science it does quantify the amount of time sports organizations can spend on redundant administrative tasks that can detract from their core goals and focus on winning games. Here is how these translate for the MLS:

The MLS teams will spend the time it takes to play 8,400 soccer games to complete all contract administration.

This analysis excludes any legal costs incurred by lawyers on all sides. These costs can be significant, but we will leave that analysis for another day.

The Solution:

Instead, imagine if the entire process had been managed digitally:

• No paper, no pens, no faxes, no email and definitely no snail mail.
• Replaced by a contract on a mobile phone and the player’s finger used to sign the contract.

In fact, this no longer requires a big stretch of your imagination — this scenario is a reality today.

Our Smart Athlete Management (SAM) Contracts solution delivers a more efficient, real-time contract management system. Administrative redundancies are reduced, disputes are eliminated, and time-consuming manual reconciliations are removed. Management of contracts takes place digitally within the system creating transparency between the club, agent, and player. Stakeholders can digitally record and sign the terms of the contract, avoiding any costly delays.

SAM Contracts, built with smart contracts on a blockchain, can make all this possible. Blockchain smart contracts are instantly delivered to all parties, enabling each stakeholder to engage in a remote, transparent, trusted and secure negotiation process. A fully electronic process ensures all parties have visibility during each stage of the negotiation.

Once the negotiation is complete, the smart contract is executed. All parties instantly sign from their connected mobile devices. No faxes required. No snail- mail. No unnecessary admin costs of finalizing contract documentation.

A successful team is one with high performing individuals both on and the off the pitch. Your ‘team’ should focus on reducing the unnecessary administration overhead in the back office to enable it to focus on the success of those ‘on the pitch’.

Learn more at sportstech.io