Arsenal fans are long used to being more frugal than their big spending rivals. Clubs like Chelsea, City and Manchester United have large bank accounts and rich owners capable of funding a last minute transfer market acquisition, but Arsenal do not have that luxury. The massive debt the club incurred during the construction of the Emirates needed to be paid off, and ever since they have shifted to the new stadium, outgoing players have far outnumbered incoming players.
This has sometimes been detrimental for the club in a footballing perspective; we had failed to win a major trophy after the Emirates switch until last season’s FA Cup triumph. World class players like Cesc Fabregas, Samir Nasri and Robin van Persie left for other teams due to our lack of success, and our limited finances meant that we could not directly purchase their replacements.
Manager Arsene Wenger deserves quite some credit for still managing to keep Arsenal competitive in the top tier of English football when so financially handicapped compared to his counterparts. He is a master of finding young talent, especially from France and England, and developing them into the next generation of world class players. Walcott, Wilshere and Ramsey are all testament to his skills.
But no matter how good your youth academy is, in today’s ultracompetitive world of European football every club needs a war chest to bring in new blood to the team. Look at Barcelona, owners of the best youth academy in the world. Even La Masia was not able to produce enough talent to keep Barcelona at the pinnacle of Spanish football, and over the past couple of seasons they too have invested heavily in players like Neymar and Suarez to help them regain the La Liga title.
Thus Arsenal was ultimately fighting a war of attrition that we were going to lose eventually; thanks to Wenger, we were regularly competing in European tournaments, but lacked a squad of the size or quality to seriously challenge for a title. But, according to the latest financial figures released by the club, our debts are almost cleared. The 2013-14 Financial Report shows that the total debts of the club have fallen to around the $60 million mark; and we have a bank balance exceeding $200 million.
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As such, within a couple of seasons, we should be fully free of all debts on the Emirates Stadium and ready to seriously start investing towards future development. This increased financial clout is slowly becoming visible; over the past couple of seasons Arsenal have invested heavily, purchasing club record signings Mesut Ozil and Alexis Sanchez for a total of close to £80 million, something that would have been unimaginable a few seasons ago.
A worrying thing, however, is Wenger’s inability to acquire players in certain areas of the squad. We have lacked a truly good defensive midfielder since we sold Alex Song to Barcelona, and despite that being pointed out by both fans and the media, Wenger has dragged his feet in every transfer window since and has still not signed a quality man. Similar concern towards the defense, our squad has always been small, but the sale of Tomas Vermaelen was probably a bad call. As it stands, apart from our two first choice center backs, the only other player capable of filling in is Calum Chambers. For a team as injury prone as Arsenal, this is not a good situation. One can only hope that Wenger is more proactive during the January transfer window. There is no point having a massive bank balance if you refuse to spend it.
The implementation of the Financial Fair Play rules by the UEFA are also a massive boost to Arsenal, it penalises clubs who rely too much on signings and rewards those who develop their own players. A club like Arsenal, with large scale youth development and training facilities; will be able to become more competitive against the financial juggernauts like Manchester City, Real Madrid or Monaco. Wenger, one of the most vocal advocates of the FFP, is sure to be pleased.
Finally, the increasing revenue being made available to clubs should help in keeping all clubs competitive compared to each other. As the following tables show, match day revenue has only increased gradually since we have moved to the Emirates, but TV earnings have spiked massively. This is due to a series of lucrative new deals being signed by carriers, and also regular Champions League qualification.
And commercial revenues are also on the rise for the club. Over the past three seasons, they have increased by 67%, and with a long term deal with Puma worth $250 million starting in 2015, the future looks rosy for Arsenal financially. Our player salaries are also well under control, with salaries accounting for approximately 56% of revenue this season, down from 64% the previous campaign.
The report was released on the heels of Arsenal’s convincing 3-0 win against Aston Villa, and as such it is a great weekend for Arsenal fans. We can look forward to the future with optimism; and perhaps our trophy room will have a few new additions soon.