I understand grog in this context to mean a warrior as they are specified as such on page 71.
There is about one grog (fighter) per magus, and there are about two other covenfolk, such as servants and craftsmen, per magus. The available craftsmen include a blacksmith, carpenter, and maybe a bookbinder, but more exotic specialists are not present.
As I read it a covenant of 4 magi will have:
- 4 fighters (i.e. grogs)
- 8 other covenfolk presumably a blacksmith, a carpenter and a bookbinder and 5 additional unskilled laborers to perform manual labor.
The rule about buying specialists with build points kick in if you want any additional specialists/skilled laborers apart from the three mentioned above. I also assume that those 3 laborers (blacksmith, carpenter and bookbinder) will be necessary for the covenant to run smoothly, meaning that they do not have additional seasons to perform favors for the magi above and beyond what is mentioned in the core rulebook. The blacksmith and carpenter create and maintain regular stuff, tools, wooden buildings etc. and the bookbinder ensures that the magi can write books as specified in chapter 10, notably a single bookbinder is assumed to be occupied to full capacity maintaining whatever books the magi create and is not available to to make extra copies of books for sale or trade. Of course each of these craftsmen can be persuaded to use their free seasons if provided with a proper incentive.
From page 72 of the core rulebook:
Specialists are non-magus NPC members of the covenant with useful skills. They are defined
only by the abilities they use to serve the covenant, rather than by a full character sheet,
and can include guards as well as teachers and craftsmen. Characters created as grogs or companions need not be paid for with Build Points.
According to the above I would count as a a specialist that needs to be bought with build points any character that allows that magi to do or gain things that they would normally need to resolve a story to get. For me (and my group) this includes but is not limited to: shield-grogs, figthers skilled in fighting together, jewlers/gemcutters, weapon/armor smiths, gold smiths, glass-blowers, masons (in case you want to construct/maintain stone buildings), extra bookbinders/librarians if you want to engage in copying and selling of books, teachers in case you want access to a source of quick experience in various mundane abilities.
As for the bit about Characters created as grogs or companions need not be paid for with Build Points I assume that it means that if your companion does something that is covered by what a specialist could also do then thats fine and dandy. Same goes if the group collectively adds extra grogs, e.g. each magus is gifted a grogs by their mater/pater upon passing their gauntlet or there is some other means that adds extra grogs then those grogs should not be paid for according to this rule.
The number of unskilled laborers here is notably way low compared to what you need according to Covenants but the numbers given on page 71 of the core book are also assumed to be the bare minimum necessary for a covenant to function and in my view should represent a level of staffing where the magi are forced to engage in a lot of activities that a summer or autumn covenant would have mundane staff to do.
By way of comparison I offer up the other things that covenants are assumed to start out with a single stone building with enough room to accommodate the magi and covenfolk, a level 3 magic aura, no magical resources and enough mundane income to ensure that the magi do not need to worry about day-to-day upkeep. (Paraphrased from the same paragraph on page 71 that contains the information on the number of covenfolk). To me this reads like a list of "This is the least you need to be considered a covenant", meaning that the base amount of anything should be considered undesirably low by any magus and causing a system where everything will have to be bought up with build points to get to a level that is more typical of most covenants. It makes sense too if things are this way because it is a lot easier to give the bare minimum in each category and have the players/storyguide buy up whatever they want to have more of in their covenant as opposed to starting out at say, a reasonable middle ground and then having the option to buy-down things you dont want to have much of.