Brazil Cup more important than ever for Gremio to avoid a hole in finances

RIO DE JANEIRO, BRAZIL – The relegation to Serie B of the Brazilian Championship forced Gremio to change something it had been adopting as a rule in recent years: not counting on money from awards competitions before the season starts. In 2022, the scenario is different, and the Brazil Cup plays a crucial role in this context.

The tricolor team will make its debut in the competition on Tuesday, March 3, against Mirassol, in the countryside of São Paulo State. Roger Machado’s team will play for a draw to advance to the second phase.

Going far in the Brazil Cup is crucial for the club’s finances. In 2022, Gremio anticipates a drop in revenue of more than R$200 million (US$39 million) by relegation, and to close the year in the blue, it will need R$30 million in awards according to the budget.

In recent seasons, Gremio’s management never projected values for awards before competitions. With the fall, however, this has changed. Outside the elite of the Brasileirão championship, the Brazil Cup is an excellent opportunity to honor the financial forecast.

Gremio is already entitled to R$1.3 million in this first phase alone. If it advances, it ensures another R$1.5 million. Then the awards are: R$1.9 million (3rd phase), R$3 million (octaves), R$3.9 million (quarters), and R$8 million (semi). In the final round, the champion receives R$60 million, and the runner-up R$25 million.

To ensure everything they would like with awards in the Brazil Cup alone, Gremio would need to go all the way to the final. However, if they get to the semi-final, they already guarantee almost R$20 million.

In addition to the R$30 million in awards, Gremio calculates to collect R$95 million in 2022 with player sales (R$155 million in 2021), R$67 million with TV contracts (less than half of the R$182 million of last year), and R$115 million with income from games.

The projected revenue in soccer is R$294 million, a reduction of more than R$170 million compared to 2021. Considering the club as a whole, the budget projects revenues of R$305 million in 2022, R$209 million less than the last year.

With these figures, Gremio also intends to spend less, cutting its total expenses from R$488 million to R$305 million, a drop of almost 40%. If the club could honor the forecast, it would close the season in “zero to zero”, with a surplus of R$385,000.

With information from ESPN

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