Arsenal fans, conditioned by the necessity of tight budgets during the Construction Years, have long been the most financially aware of any European football club’s followers. Years with no actual trophies led to a sort of Moral Purity Trophy being awarded by those same fans when Arsenal’s business methods are held up against the evil largesse of the nouveau riche, personified by first, Chelsea, then Manchester City, and the leveraged excess that is the Manchester United Money Printing Machine.
When determining how a particular transfer window went, net spend was a key metric used by many fans, despite clubs not regarding net spend as an important part of transfer business.* Now we understand (and if we read Swiss Ramble at all through the years, we’ve known for awhile) that clubs account for these transfer deals differently. Jake Cohen on ESPN FC explained that a player’s cost is determined by the following equation:
Basically, clubs account for their signings’ transfer fees over the length of their contract (“amortization”) and also - and this is the piece that fans often overlook when talking about transfer business - take into account wages, which are the much bigger expense over the course of their deals. The downside to “net spend” as it has previously been (mis)understood is that it never took into account the second half of that equation.
*Quick aside: During the mid-aughts to the early part of this decade, net spend was basically how Arsenal operated. Arsene Wenger’s egalitarian compensation policy and refusal to let players leave on a Bosman led to the transfer dealings driving Arsenal’s business. If the second half of the above equation is equal in all scenarios, the transfer fees coming and being paid were the only thing impacting the team’s finances. Now that the Gunners have broken that wage structure and started paying big transfer fees, it’s probably long past time to bury the Net Spend Fella.
Now that Arsenal’s summer dealings have concluded, let’s take a look at how much the club outlaid in the transfer window. Note: Arsenal are really secretive about all this information, so, we’re basically going off of the most reliable estimates for fees and contract information that we can find.
EXPENSES OFF THE BOOKS
While no substantial player sales were made this summer, the club cleared a considerable amount of money due to Mikel Arteta, Tomas Rosicky, and Mathieu Flamini all coming off the books. Arteta and Rosicky were both among the highest earners at the club (£80k/week and £85k/week, respectively) and Flamini made more than a player of his caliber deserved (£65k/week).
Arsenal sold three players this summer - Isaac Hayden, Wellington Silva, and Serge Gnabry. The first two were youth players who made no impact with the first team, thus their contract details were never really public (Gnabry was on a rumored £10k/week). None of these sales substantially impacted the bottom line in terms of their wages. Gnabry did, however, net a €5-6m transfer fee. Often, transfer fees will be paid out over time but due to this, relatively, small fee and the fact Gnabry only had one more year on his contract, I accounted for the entire fee this season.
As for the loanees, we know for certain AFC Bournemouth are paying Jack Wilshere’s full wages (£90k/week) as well as a substantial loan fee of £2m. There are no solid reports on whether Middlesborough or Sporting Lisbon are paying the wages for Calum Chambers (£20k/week) or Joel Campbell (£30k/week), respectively. Multiple Premier League sides and a few top flight sides overseas were interested in bringing Chambers in, so it seems probable his small wages are being covered by Boro. There was a report in the Portuguese media which made its way around Twitter that Arsenal are paying the majority of Campbell’s wages, so I accounted for 1⁄3 of his wages being off the books this season.
EXPENSES COMING IN
Arsenal spent a considerable amount in transfer fees and wages to bring in Granit Xhaka (£30m fee, £125k/week, 5 years), Shkodran Mustafi (£35m fee, £90k/week, 5 years), and Lucas Perez (£17m fee, £70k/week, 4 years). Rob Holding (£2m fee, £10k/week, 4 years) looks to be a steal. The only other first-team signing this summer was Takuma Asano, who came in for a reported £1m fee. No contract details were ever even rumored for him, though, so I put him on the minimum first-team wage, £10k/week. It seems likely most or all of that wage is being paid by Asano’s loan club, VfB Stuttgart in the 2. Bundesliga.
The most notable conclusion from a comparison of these two charts is that Arsenal appear to have actually cut salary through its transfer dealings this window. This does not mean Arsenal’s wage bill will be down this season, as the difference was minimal and other players, such as Alex Iwobi and Nacho Monreal, have received raises. However, it does indicate some level of financial responsibility from Wenger, which will come in handy as the club attempt to lock up Mesut Özil and Alexis Sánchez with big contracts through their remaining prime years.
It is also notable that the sale of Gnabry and loan of Wilshere offset a fair chunk of the transfer fees accounted for this season. That being said, those fees are only accounted for this season and Wilshere’s wages will be back on the books next season. So while it may seem like the Gunners did not spend much more than they brought in this offseason, the long-term player costs were substantial. With the increase in television revenue, this current increase is sustainable, but likely not replicable. Don’t get your hopes up thinking the club can afford to sign multiple starters at marquee positions year after year.
Arsenal’s transfer dealings this summer displayed a willingness to use funds held in reserve and to expand yearly salary commitments to three big-earning players all while maintaining its trademark financial prudence in a wild transfer window. That prudence should allow Arsenal to continue to supplement its young, deep core going forward.