The Uruguayan is set to complete a £70 million move to Barcelona after the two clubs confirmed an agreement is in place, with Brendan Rodgers insisting "no one is bigger than Liverpool".
|2/1||Liverpool are 2/1 with bet365 to not beat Southampton on Aug 16|
"It will obviously be very difficult to replace Luis Suarez," Carragher told talkSPORT.
"Liverpool are spending the money in a different way by strengthening the squad in lots of different positions, but they've almost had to do that because you're not going to get anyone better than Suarez.
"I'm sure Brendan will be looking to sign a top-class forward now, but we're talking about replacing one of the best players in world football.
"Maybe only Lionel Messi and Cristiano Ronaldo have been above him over the last few years, so chances of finding someone better are very slim.
"But with Champions League football returning this season, Liverpool need a bigger squad and more quality and it seems like they're addressing that at the moment."
Liverpool mounted their first serious tilt at the title in five years last season, helped by Suarez's 31 goals in the Premier League alone, but Carragher is not confident of similar success in the new campaign.
He added: "It will be difficult to replicate last season, not just because of Suarez's absence, but because of the additional pressure and fixtures that come with European football.
"It's something Liverpool didn't have to contend with, so it'll be totally different for the squad, a lot of the players haven't played at that level before.
"It will be an interesting season, no one predicted that Liverpool would have such as good campaign last term, so if the side can reproduce that again this season, without Suarez as well as coping with Champions League football, it will be an even bigger achievement."