Biggest club in the world?
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Chelsea started talking in 2006 about becoming a bigger club than Manchester United. Sir Alex glows red and laughs. Chelsea respond by claiming that one in seven football fans in the world supports Chelsea.
But is there a shift happening in English – indeed world – football. And if so where does that put Arsenal? Who is bigger – Arsenal, Chelsea or Manchester United. In terms of share value and turnover, obviously it is Arsenal. But there is another side to this – how the club conducts itself. In terms of unsecured debt and debt repayments Man U have that – the owners borrowed money in order to buy the club and then put that debt into the club – which has to pay for its own purchase. Following this Man U has continued to use the traditional model of football – spend in the transfer window – something they keep doing, and something which worries the plc like mad. The 2007 summer window was no exception – £30 million spent in the first week. Chelsea invented a new method – Russian oil. Arsenal have also found a different method – they set up the most intricate network of youth and young player scouts the world of football has ever seen and sign up the golden kids for very modest sums. By 2007 Arsenal were the only team in the Premiership to count transfer money as an INCOME. Everyone else counted it as cost – sometimes a cost of £30 million or more. Both the Chelsea and Arsenal models are sustainable over time because even if the clubs have a poor season (or indeed a run of three 2nd places in a row and a continual failure in Europe as Arsenal had while Man U were winning the league) the expenditure is still ok. The Man U model however is not sustainable in the face of poorer showings on the pitch because the only way to get the money in for the transfers each season is through marketing, and the marketing income is incredibly closely related to pitch success. While it would take a decline of earth shattering proportions to reduce the number of people who attend Man U home games, it will only take a few years of coming third and being overshadowed by two London teams for the marketing income (from shirts to overseas TV) to drop and for the long distance fans to switch from a city they will never visit, to one of the most famous cities in the world.
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