Why Arsenal's Financial Model Doesn't Work For The Fans

Arsenal is the only Premiership club whose gate receipts are the primary revenue stream. So, given that the paying supporter funds the club more directly than any other European rival, fans have every right to ask why they cannot afford to keep their best players and win silverware.
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Arsenal is the only Premiership club whose gate receipts are the primary revenue stream. So, given that the paying supporter funds the club more directly than any other European rival, fans have every right to ask why they cannot afford to keep their best players and win silverware.

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Wenger’s humble salute to Sir Alex Ferguson last week was a pertinent reminder that their rivalry is a small piece of the grand tapestry that is the Manchester United manager’s career. A once bitter relationship fuelled by competition has diminished in tandem with Arsenal’s gradual decline as a title-fighting force against Ferguson’s self-built mega-club.

And this week presents the ultimate symbol of that decline. Arsenal must win their last two games – on Tuesday night at home to Wigan and on the final day at Newcastle – or face the possibility of exclusion from the Champions League for the first time in 16 consecutive seasons as part of Europe’s elite.

The Gunners’ recent history presents a paradox. On one hand is the most state of the art stadium in the Premier League, with the second highest capacity and a corporate branding that is deliberately in place to demonstrate an ever-broadening global appeal – this commercial development is something of a step towards United’s blue print to success.

But on the other is a ‘selling club’ that each summer lets key player leave. For varying reasons Vieira, Henry, Cole, Flamini, Gilberto Silva, Toure, Adebayor, Nasri, Fabregas, Clichy, Song and Van Persie have all exited after playing influential first team roles, and received a pay-rise in the process. Since their last trophy in 2005, the club have made a net gain of £33.25m from transfers – the playing squad has not been invested in, but profited from.

Wenger has long defended criticism of his transfer policy. “In England there is a way of thinking that every problem is sorted out just by spending money but that’s not always the case,” he said in February. “There were many major issues we were fighting to keep our best players. You can only keep your best players by paying the wages of the market. To pay the wages of the market we have to put the ticket prices up and then the fans turn against you, but that was the consequence of the unfair competition that we faced.”

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To combat this short-term “unfair competition” Arsenal are supposedly building for the long-term by running the business upon a ‘self-sustaining model’. This idea is packaged up and served to the fans as a measure to safe-guard the future of the club, but the question remains as to whether this future is geared towards a trophy-laden era or a profit-making business.

Arsenal’s turnover was £234.9m last season, the sixth highest of any football club in the world according to Deloitte. This money was split 22% commercial, 37% broadcasting and 41% match-day revenue. This is a remarkable set-up: Arsenal is the only Premiership club whose gate receipts are the primary revenue stream. So, given that the paying-supporter funds the club more directly than any other European rival, fans have every right to ask why they cannot afford to keep their best players.

Despite the £15m of yearly interest generated by debt that funded the new stadium, Arsenal still turned a profit of £35m last season. If this and future profit isn’t injected into the squad Arsenal will continue to fall behind. The idea that Jack Wilshere, Alex Oxlade-Chamberlain and Aaron Ramsey will be the future of the club is naive and ignores the very problem that if any of those players one day become so good that they outgrow the wage structure, they too will join the conveyor belt to a bigger club paying more money. UEFA’s Financial Fair Play rules will only level the playing field so much if Arsenal continue to put financial limits on their ambitions.

The club must be bolder in breaking their wage structure and providing Wenger with funds in order to halt the on-pitch decline, let alone invigorate the title ambitions of old. The worry for fans is whether Stan Kroenke and chums have noticed the football going on in their giant glistening Emirates-clad stadium. Missing out on Champions League football might be the wake-up call they need.