Since Roman Abramovich became the new owner of Chelsea Football Club in 2003 they have been renowned for being the big spenders in the English Premier League.
From 2004-2009 there was an estimated gross spend of over £325 million on players, although £245 million has been recouped on sales of players during that time and notably during the 2009 season there was a profit on players sales (verses expenditure) of an estimated £68 million.
Obviously transfer fees are only half the story, players wages, are notoriously expensive, Chelsea spent a reported £142million on players salaries last year alone. This massive expenditure is offset somewhat by ticket sales, merchandise and replica shirt sales, advertising, television payments and indeed prize money for winning the premier league, estimated to be in the region of £15million.
Chelsea continue to maintain they are in a strong financial position and are reported to be on target to ‘break even’ within the next few years.
Since the takeover by Abramovich, the investment in football terms has pay dividends, and Chelsea have enjoyed a very successful era; they have won eight major trophies, including the Premier League 3 times, the FA Cup 3 times and the League Cup twice – making them the most successful English team in the last seven years.
Chelsea are not the only big spenders in the Premier League, and there are growing concerns about the financial position of some football clubs. In addition to the huge spending by some clubs, this financial power is also seen by some as an unfair advantage, if a club has the backing of wealthy businessmen or consortiums.
Another issue which is causing concern is the perceived lack of ‘home grown’ talent, which may adversely affect the national team as well as the clubs, by the massive influx of quality foreign players into the Premier League.
The football governing bodies have now taken action. From the beginning of the 2010/11 season The Premier League will introduce a squad cap of 25 players and a quota on ‘home grown’ players. From this season, clubs must include eight home-grown players out of a squad of 25.
A home-grown player is defined as being registered with the club for a minimum period of three entire seasons before the age of twenty-one.
Chelsea seem to be ahead of the game here, by moving to their new training ground in Cobham, Surrey in 2004 and opening their new multi-million pound state of the-art training ground in 2007, which includes all the latest in training, rehabilitation, medical, pitch and media technology and this is also the home of the youth team and Chelsea academy.
Cobham is home to the Under 9s through to the Under 18s, all the way through to the Chelsea first team. The academy is overseen by Chelsea sporting director Frank Arnesen who was appointed in 2005 and is well known for his ability to develop young players.
Chelsea already have several academy players on the verge of breaking into the first team. The long term strategy obviously has to be the development of talented young players rather than paying huge amounts for older players from other teams, this will also ensure future financial stability.
Developing home grown players is considered to be a vitally important goal for Chelsea. Cobham gives us the perfect platform for that, It is a general consensus that the new Premier League rules on home-grown players will benefit the long-term future of football.
Another issue for Chelsea are the huge salaries of the players, From the 2012-13 season clubs entering European competition will have to prove they are financially stable, and will only be allowed to spend on player transfers and wages what they earn in revenue, this is another factor that will prompt the development of youth team players to reduce massive transfer costs.
Prior to the start of this season, Chelsea have released several high profile players, who were reported to be amongst the highest earners at the club, it will be interesting to observe the developments and wage structures over the next few years, again, I believe Chelsea are ahead of the game, and will continue to be a major presence in English, European and World football.