- How different people react to Arsenal’s march onwards and upwards
- How do you measure success in a football club or the competence of a commentator?
By Tony Attwood
With Arsenal doing rather well in terms of football (played five, won four, conceded one scored ten), it is natural that football journalists who thrive on negativity have turned elsewhere for a story with which to knock Arsenal.
And thus they have turned to the economics of the club. And here, although many journos seem utterly confused, it is being noticed by the brighter scribblers that although the club is losing money, when it comes to meeting football’s own requirements (which means taking out of the equatioin spending on the ground, training faciltieis, youth and community work, women’s football and maybe one or two other things that are concidered worth spending money on), Arsenal still lost quite a lot.
So in the last couple of years, Arsenal actually lost getting on for £60m which could be considered rather careless. But they can meet football’s own rules because some of this money was spent on improving the ground, youth and community work, and again, women’s football.
Thus, in terms of football’s unique way of assessing itself, Arsenal were doing ok. But if you were the person responsible for keeping the club afloat financially, you would be noticing that you were spending more and more, rather than being able to think about paying yourself a dividend or even some of the money you had loaned the club in the first place. And that can be a somewhat dubious position. because a) it makes the club much harder to sell if you wanted to, and b) you have to keep on forking out more and more cash every time the manager wants to buy a player, or the TV companies want a new gantry.
The target, of course, is for Arsenal to make a profit, in the sense that you or I might understand it. In the simplest terms, with all expenses taken into account, the money coming in is more than the money going out. Forget which bits can be accounted for in terms of financial fair play and the like – the big question is, are you, the boss, going to run out of money, or are you, the boss, going to find that you can pay yourself back for the loans you have put in and the money you paid for the club.
There’s a lot of complex financial whatnots in here because of not only accounting rules but football’s own rules, but the generally accepted view is that at least before this summer window, Arsenal were going the right way. How the finance people feel about things at the end of the year will be a reflection of how much extra income the expenditure on new players in the transfer window has improved income.
So, for example, if Arsenal were to make it to the Champions League final, that would do a lot for the club financially. If they were to go out in the first round of eight, that would be a disaster. Likewise for the FA Cup. And of course, with the League, Arsenal need to be challenging at the very top (if not actually winning it) right up to the last.
For good results mean not just more cup games but also more TV money from around the world. In this regard, the modest summer transfer window of 2024 helped improve the finances. This summer’s expenditure will have knocked the accounts out of shape once more.
In a recent review The Athletic projects a small profit for 2024-25 which means Arteta is not constantly looking over his shoulder at the Premier League’s accountants’ view of the world. Yes Arsenal will need to sell some players – probably in January, particularly looking at those who were shipped out on loan in the last window. But it is not desperation time.
Of course, Arsenal also need to keep their wages bill within Premier League limits, so although all the up-and-coming youngsters have saved money on transfer fees, there is still a knock to the accounts when it comes to keeping them at the club. Myles Lewis-Skelly and Ethan Nwaneri have signed new contracts at enormously increased salaries. Others coming through will have noticed that.
It is being suggested that Arsenal’s wages bill is very close to the 70% of income limit, which means that for any more player purchases, there is going to have to be a player leaving who is currently paid the same as the new man, or more. Available players and clubs trying to keep their players will know that and be warning players about Arsenal’s situation. Of course, journalists, TV “experts” and bloggers who focus totally on results, will ignore the issue, but it is still there. Arsenal can’t increase their salary level further without increasing their turnover by a similar amount. That can be done by reaching Cup finals and taking the league decider to the last match or two, but there are no guarantees, and it is not easy to do.
Worse, everyone knows Arsenal struggled to sell this summer while the media will endlessly be demanding more and more transfer activity, since this is where they get all their “news” (or to be mroe accurate, fantasies) from.
But the good news is that Arsenal earned €2.1m from their victory last night, in prize money. More such wins are needed, not just to qualify from the group stage but also to meet the financial sustainability rules.
