Chelsea signalled the potential dawning of a new era last week when they proposed to buy the remaining ground shares currently owned by the fan organisation Chelsea Pitch Owners. This move could signal either a move to a new stadium or an expansion of Stamford Bridge. What becomes clear from this move, though, is that Chelsea are desperately seeking ways to squeeze out more revenue as they attempt to wean themselves off sugardaddy Roman Abramovich as they look to comply with the future implementation of the Financial Fair Play (FFP) rules. Chelsea are far from being a self-sufficient club and they are as reliant on Abramovich now as the day he took over, so why has such little stock been placed in the developing of talent?
Former Chelsea Chief Executive and all-round despicable human being Peter Kenyon declared back in 2008: “The long-term plan here was always that we needed to be profitable, non-loss-making and self-funding. In terms of breaking even, I think it will be 2010-11 but, this year, we’re very clear about achieving no-funding targets from the owner. It’s a process we believe can be achieved by the end of this season. I think we’ll be growing revenue.” Going into this season, Chelsea are operating at a financial loss of £70m. So where did it all go wrong?
There was a clear transition in terms of the club’s transfer policy, particularly under the reigns of Felipe Scolari and Carlo Ancelotti, until January last year at least, as the club cut it’s cloth accordingly. As a result, the spine of the Chelsea side has aged and now requires replacing.
The dreadful job Frank Arnesen did at the club now only begins to come under more severe scrutiny. The club have failed to develop replacements for the likes of John Terry, Frank Lampard and Didier Drogba internally and so in order to continue to compete, they’ve been forced to go out and buy their replacements at great cost.
The club have spent a net amount of £112.5m on transfers in 2011 alone as they’ve brought in the likes of Fernando Torres, Juan Mata, Romelu Lukaku, David Luiz and Raul Meireles.
During Abramovich’s seven-year reign at the club as owner, the club operate, on average, at a loss of £79.7m a year. Also, the club’s wage structure is completely all over the place as wages account for 82% of turnover, which when you compare it to Man Utd’s 46% and Arsenal’s 50%, it simply serves to highlight how terribly the club is being run in the long and short-term.
Such high wage turnovers are usually indicative of a club with an ageing squad. It’s difficult to move on players when they approach a certain age as other club’s are unwilling to match the hefty wages that they’re currently on.
Cast your eye around the current Chelsea squad and it’s clear that the emphasis that looked to be switching under Ancelotti has reverted back to type, with barely a young player in sight.