One of history’s greatest consistencies is the rise and fall of empires, with eras often defined by triumph and downfall in equal measure. This is also true in the world of football, with German giants Schalke 04 becoming the latest team to fall victim of this trend. Once a towering figure within the Bundesliga and a crucial side in shaping the landscape of the game in Germany, Die Knappen find themselves fighting for their existence. They still have the second highest football club membership in Germany and 4^th in the world with 178,000 members yet have an incredibly difficult road ahead after a torrid few years. The downward spiral that Schalke have fallen upon since the turn of the decade has left fans across the world wondering what the future holds for the club, if it even has one at all.

It was only 13 years ago that they found themselves in a Champions League semi-final, and were Bundesliga runners up as recently as 2018. On paper, it’s completely implausible that a team that have won seven Bundesliga titles, five DFB Pokal’s, one DFB Ligapokal, a DFL-Supercup, and the 1996/97 UEFA Cup (now known as the Europa League) could end up on such a downward spiral. The team are steeped in history and were Germany’s most successful club throughout the 1930s and early 1940s, winning 6 of their 7 league titles during this period. The list of players that have played the team reads incredibly impressively. Icons of the game such as Raul, Benedikt Höwedes, Gerald Asamoah, Klaas Jan Huntelaar, Marceo de Souza (aka Rafinha), Mesut Özil, Ivan Rakitic, Manuel Neuer, Leroy Sane, Julian Draxler, and Klaus Fischer have all donned the famous blue jersey throughout their careers.

So how did it all go so wrong so quickly? Much like many other teams and businesses that have come under the same fate, poor management of finances equate for many of the problems. Over the space of a few years in the mid to late 2010s, a young core of fantastic players left the club on free transfers leaving Schalke with no financial return. First-team regulars such as Sead Kolasinac (who left age 23), Maximilian Meyer (22), Joël Matip (24), Alexander Nübel (23), and Leon Goretzka (23) all departed the club on the expiry of their contracts for no fee. With better handling of contracts and not just allowing them to run out then the story could’ve been incredibly different. These five players alone could’ve potentially drawn well over €140 million, yet Schalke were left with zilch. Add on top of that their tendency to panic and overpay in the transfer market with a want to make the next step towards being a European powerhouse similar to the likes of Real Madrid, Paris Saint Germain, and Manchester City to name a few, then you have a recipe for disaster. The signings of Breel Embolo, Nabil Bentaleb, Johannes Gies, Yegven Konoplyanka, Sebastian Rudy, Omar Mascarell, and Rabbi Matondo cost approximately €106 million combined. All of the players ended up as flops and were sold for far less than what they were signed for or left the club on free transfers. Schalke only retained €16.5 million for them, equating to a loss of €89.5 million on seven players alone.

Aside from transfers, the club spent an enormous amount of money on player salary. According to the football salary website Capology, in the 4 seasons leading up to and during the first relegation season itself in 2020/21, Schalke paid an eye watering €290.4 million in wages, with an average yearly wage bill of €58,080,000. In the 2019/20 and 2020/21 seasons where they didn’t feature in any European football, the club still spent €114.5 million on wages, a number that would be more akin to a team in the Champions League. Whilst Champions and Europa League qualification kept the club afloat for a while that was gone, and Schalke were spending huge sums of money and making poor investments at a rate that tournament prize money alone couldn’t sustain.

The Covid-19 pandemic was a tough time for the club, with their financial struggles only worsening as a result. Football teams across the world felt the financial blow the pandemic brought, but for Schalke it came alongside their billionaire owner, Clemens Tönnies, resigning in June 2020. Tönnies had been part of the club since 2001 and is the owner of meat processing company Tönnies Holding. Fans grew frustrated with Tönnies’ ownership, culminating in a socially distanced protest of 1,500 supporters calling for him to leave during the pandemic. Supporters had been calling for his resignation since August 2019 after he made racist comments about North Africa following a game against Paderborn, and an outbreak of 1,400 cases of Covid-19 in one of his slaughterhouses was a tipping point for many fans to call for him to pack his bags. While Tönnies wasn’t the outright owner, as German teams follow a 50+1 ownership model, he still had a significant role in the club as Chairman and contributed huge amounts of funds towards the team. With the team in financial ruin and among an awful run of form ending the 2019/20 season without a win in 16 games, the future looked bleak.

Unsurprisingly, the 2020/21 season was an absolute disaster for the Gelsenkirchen club as they finished rock bottom of the Bundesliga managing only three wins in the league with five different managers (if you include Huub Stevens’ interim spell as head coach which I’m choosing to do). To their credit, they did manage to bounce back in the 2021/22 season by winning promotion back to the Bundesliga at their first attempt and going up as champions. However, their spell back in the top-flight went just as poorly as it did two seasons prior, winning only seven games this time around as the club were once again relegated. This time finishing 17^th out of 18 teams, missing out on an opportunity to stay up via-the relegation playoffs by only 2 points.

This has all led to the team currently finding themselves sat in 15^th place in the 2. Bundesliga, the second division of German football, 5 points clear of the relegation playoffs with 3 games left to play. If Schalke do end up getting relegated to the 3. Liga, they will fail to meet the requirements to obtain the license for the Third Division due to their €165 million debt. If this happens then they would essentially have to start again as an amateur club in the Regionalliga West, the fourth division that features teams in the German state of North Rhine-Whestphalia. Going from finishing as Bundesliga runners up to starting up as an amateur phoenix club of sorts in the space of only 6 years would be a fall from grace to an extent that football hasn’t seen.

Relegation is never a preferred outcome for any team in sport, but in the case of Schalke 04 if they were to go down this season then it would beyond catastrophic. Losing Schalke would be an absolute tragedy to the world of football as the club’s historical and sporting significance cannot be underestimated. 119 years of history would be lost in an instant. Teams can of course bounce back from the brink of extinction with Glasgow Rangers being a prime example, but there is a long and uncertain road ahead for Schalke before they can start thinking of becoming a powerhouse in German football once again.