“Arsenal are not a shoo-in to get the top four next season.”
Like it or not, Paul Merson is completely correct. Arsenal qualifying for the Champions League in 12 months time is not a shoo-in.
The Premier League is the toughest in the world for top teams.
Whereas Spain only has two top teams (Barcelona and Real Madrid), Germany and France have one a piece (Bayern Munich & PSG), England has 6 clubs who have consistent battles it out for top 4 over the last decade. With only Manchester City being an ever present.
That 6 is set to become 7 with Newcastle. And could be 8 is Aston Villa continue on their upward curve.
Other than Manchester City, no one can really bank on finishing top 4. And therefore mid-term budgeting should not be based on finishing top 4.
Champions League football comes with a huge financial boost. From TV money to increased gate receipts and sponsorships. It is probably worth around £100m.
But just because Arsenal will likely have an additional £100m income next season, it does not mean or transfer plans change.
Players are not bought for the next season. They are bought for the next 5.
5-year contract and transfer fees amortised over that period means you need to have a mid-term budget account for the next half a decade. That means taking into account that whilst you have an additional £100m for the next season, it does not mean you are guaranteed that for the next 5.
We often see it with clubs at the other end of the table.
Having gained promotion to the Premier League, sides bring in a host of new players which sees their wage bill and amortisation jump up. Then they get relegated.
Even with parachute payments, they struggle to balance the books having lost their Premier League place and it takes 4 or 5 years for them to financially recover.
League One is filled with ex-Premier League sides that had poor financial planning.
We will (potentially) see next season and beyond the impact of no Champions League football for Liverpool and Tottenham. Whilst Chelsea owners are set to send their club further into debt with no European football at all.
Arsenal’s transfer spending this summer will not be based on Champions League. It will be based on what their predicted earnings are over the next 5-years.
You have to remember that in recent years, due to Covid and no elite European competition, we have made huge losses.
Those losses were able to be managed due to us having a large cash surplus. Like a rainy day fund. But in the last half a decade that has been eaten into.
A healthy cash balance allowed us to keep spending big, even when revenue dropped. So you when revenue increases once more, cash will be set aside to replenish those funds.
A football club is no different to me or you.
If you are in a commission based industry, you do not go and get a mortgage after a good months bonus. You understand that the next month, bonus might not be as good.
Those that do spend big when they get a good bonus find themselves living a boom and bust lifestyle. One month they are King of the Hill, next month they are a pauper struggling make ends meet.
Those who are sensible maintain the same level of lifestyle, regardless of bonus. They put their additional earnings away. Into savings and investments. Keeping it for that rainy day.
Every now and again, they might dip into that fund to treat themselves. A new car. A new watch. But they do not increase their kid-term standard of living.
I always used to tell my staff – live off your salary and treat your bonus as just that, a bonus.
And for football clubs, Champions League income needs to be seen as a bonus, not a certainty.
I expected us to spend £100-£150m this summer regardless of where we finished in the league. That doesn’t change with a top 4 place now secured.
The top of that (£150m) is dependant on sales. Balogun, Tierney, Mari et al. The bottom end is if we struggle to sell and end up having to loan out.
It may become closer to £200m if someone like Emile Smith Rowe is moved on.
If you think that Arsenal should be spending more than £150m this is summer, then I dread to think of your own finances. “Keeping up with the Jones’s” comes to mind.
Those that are demanding we spend £200m+ probably have no financial skills of their own. They are probably hugely in debt. Rely on credit cards. All because they wanted to live a more expensive lifestyle than their salary dictated.
We keep improving by being sensible. By buying 2-3 players a season. Improving the squad year on year without mortgaging the clubs future.
I have always said, Arsenal is not something for the next 2-3 years. We are something for the next 2-300 years. And you only survive at the top for as long as we have through being financially sensible.
Have a good one.
Keenos
She Wore A Yellow Ribbon 
Brilliant read. One of the most sensible I have read in a long time.
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Finally, someone with good financial and squad building sense. Spending a lot of money on a lot of players might not work. Overly entitled fans should not look at the club as their personal Championship Manager game. These fans have no knowledge of bad consequences because of the privileged and entitled world they live in. Personally, I have no worries because Arteta knows exactly what to do. A winning team is better than expensive players.
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