Friday, August 19, 2022

Gazidis on Wenger, 2014 finances and ambition

Morning all, we’ll start this morning with the stuff from Ivan Gazidis in which he discusses the club’s ambition, its finances, its spending and the manager.

Speaking to the Telegraph the Chief Executive has gone on full PR assault, some of it makes perfect sense, other parts of it will struggle to convince some fans, and it’s worth reading behind the headlines which are designed to sensationalise more than anything else. It’s probably worth breaking it down into various sections. First off he talks about Arsene Wenger and the possibility that he’ll be offered a new deal, taking him beyond the one which expires in 2014.

It’s not a sense of sentimentalism, not a reward for services, it’s a belief that we have an incredible manager who loves this club and is the best man to lead us forward. We’re really confident about the direction that the club is heading. I feel he can keep going for a long time. He’s in fantastic shape and he’s as driven as he’s ever been and excited as ever.

I guess this is going to divide people more than anything else. If, for example, we don’t win a trophy by 2014, it will be close to 10 years without silverware. While I’m fully behind the notion that trophies aren’t the be all and end all at any football club you do have to ask would any top level club keep a manager who hasn’t won in that long? Now, I believe there’s more to Arsenal and Arsene Wenger than most manager/club relationships, something Gazidis talks about later, but the bottom line is that it’s Arsene who brought sustained success to the club and as such raised expectations.

If he’s suffering now it’s because he set the bar so high but it doesn’t alter the fact that we’ve not won anything for so long. Of course this point could be moot by the end of this season, and I dearly hope that it is, but as great as I think Wenger is, and I do, it will be a hard sell in 2014 otherwise. Gazidis then spoke about the new commercial revenue streams available to us in 2014:

In terms of the financial impact, it will be as significant a step forward as the stadium was in 2005. It does kick us into the top five clubs in the world with separation from the rest. The overall journey that the club embarked on was to make it one of the leading clubs in the world and to do it in a way that would be sustainable.

Now, this I get behind completely. I’ve never quite understood the complaints about the commercial deals we have in place now. It’s not as if we went into them and got hoodwinked. We knew they’d hamstring us but we simply had to do them to get the stadium built. If there’s an issue it’s that it’s taken us too long to try and bridge the shortfall with other commercial revenue, and that’s an issue as much as anything else (the Q&A with Tom Fox is worth a read in that regard).

But there’s no doubt our shirt deal is ridiculous at this stage and when 2014 comes we have to make hay. When you look at what Liverpool – a club that has fallen on hard times from both a football point of view, as well as struggling with the kind of press coverage Genghis Khan could have done without – then it shows what extra revenue we can bring in. United have a £20m a season deal for their training kit! That’s how far behind we’ve fallen. Bringing in an extra £25-£30m a year makes it easy to see how that can benefit the team. Buy a £20m player and pay him the appropriate wages, or two £10m players etc, that’s the difference it can make.

Yet many will ask what is the point in having increased revenue when we seem reluctant, even now, to spend the money we have available. Gazidis says:

We get accused of a lack of ambition or complacency because apparently the board are only interested in the top four. That is absolute rubbish. To me this is the most ambitious football club I know.

And look, trying to challenge for the title and maintain a place in the top four when our finances are restricted and all around us are spending like Croesus in a remake of Brewster’s Millions means we have to do things differently. ‘Self-sustaining’ sounds like a cliche now but I’m sure I’m not alone in thinking football clubs, like any other business, should operate with the resources they generate as a business. Manchester United did it more successfully than anyone else for years. Folk scoffed at them for their shirt changes and marketing to the far east, but all they did was blaze the trail for others to follow.

The landscape has changed, of course, with the influx of sugar daddy owners, reaching new heights with Man City. The money pit is bottomless, it creates an artificiality within the game, with transfer fees and with wages. We know well the knock-on effects as the money on offer there has lured away some players we might have liked to keep, but it trickles down throughout the game. Wage demands increase, clubs find themselves in more debt and are running to stand still in many cases. So I love the way that this club is run from a financial point of view – in that we generate our own income.

Where I would have an issue is that we generate this income and fail to use it. There’s a lot of money sitting in the bank, money that could have been spent on players to improve the team or to add greater depth to the squad – would anyone argue that another striker, for example, would do anything but make us more competitive? – so it’s very difficult to say we’re the most ambitious club around. As I said, I like how we’re run, I hate the idea of Arsenal having to rely on the generosity of a benefactor to compete, not simply because that kind of thing would skew our finances forever, but because we almost always err on the side of caution when it comes to building our team. Is Ivan saying that will change in 2014?

Nobody is asking for Arsenal to go spend £50-£60m on one player, nobody’s asking for us to compete with Man City or Chelsea, or even United, in terms of wages. All people want is for the club to use the resources available to the fullest extent. At that point you can say we’re the most ambitious club because not only are we fighting our own corner in terms of generating income but we’re using it too. As long the money sits in the bank, and the team falls short, then people will ask questions, and rightly so when you consider ticket prices and so on.

Clearly the potential that Arsenal Football Club has is huge. We have a big stadium with a very manageable debt, we play Champions League football every season, we’ve got money in the bank, good revenues and the capacity to grow them by a considerable margin in the coming seasons. As a business we’re as well run as any football club in the world, but you can’t convince people that there hasn’t been a price to pay in terms of the football club.

Surely it’s paramount that when the current sponsorship deals come to be renegotiated that we have a team which will make the job of doing those deals as easy as possible. Brands want to be associated with success and the top players, they piggy-back off it, so perhaps we need to look at the reasons why we’ve struggled to compete on the pitch, and to keep some of our best players, before we go down that road.

As I said earlier, success this season isn’t out of the question. At the moment it looks like we have a nicely balanced squad who have renewed focus on some of the basics which have let us down, but any failures will just see people come back to why we have so much money in the bank and why, for the most part, we operate a transfer policy which appears to generate profit rather than provides tangible investment in the playing squad.

Anyway, we’ve started the season pretty well, there’s a good chance for three points against Southampton on Saturday, the Champions League begins next week, and as long as results stay good then the general mood will be good. I don’t quite know why this particular interview was necessary, maybe some pre AGM groundwork, but there’s no doubt some parts of it don’t stand up to too much examination, even if you’re of the opinion that we’re a club that operates in a healthy way, for the most part.

Till tomorrow.

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