Chelsea seek way to earn big bucks

Abramovich's bottomless pocket will not satisfy demands of Financial Fair Play ruling

So how do a football club who declared a loss of £70 million this year, then spent a matching sum on new players the very next day, reduce the total to the small single figure allowed when Uefa's Financial Fair Play scheme finally bites over the next few seasons? The answer, said quickly, is obvious: increase income, decrease costs.

Chelsea's chairman Bruce Buck, a quietly spoken American lawyer, does not say many things quickly, preferring to choose his words carefully, often pausing for some time before formulating them lest they be misinterpreted. His considered verdict therefore comes slowly: "We have to up our sponsorship income, there's no doubt about it, and up our match-day revenues, reduce our transfer fees a bit, reduce our payroll a bit. I'm not saying the job we face is easy, it's difficult, but we have to do it." Renaming the stadium, rather than relocating it, is currently among the favoured options.

It could be argued that with the sixth-highest income in world football, Chelsea are a financial powerhouse; only Real Madrid, Barcelona, Bayern Munich, Manchester United and Arsenal (in that order) bring in more money. Yet that statistic makes their losses all themore staggering.

In the first year after Roman Abramovich was entranced watching United play Madrid and decided to buy a club, Chelsea lost £87.8m; the following year's figure was an eye-watering £140m. While the losses have not since touched such heights, the average over the seven years is £79.7m. For a while this hardly mattered; the current court case in which he is being sued by his fellow oligarch Boris Berezovsky suggests Abramovich is unlikely to be seen selling The Big Issue at Fulham Broadway Tube station. The only concern during the first couple of years was what would happen if he grew bored and wanted his loans back, which was alleviated by Jose Mourinho winning the club's first League championship in 50 years.

Having initially declared that they intended to break even by the end of the decade, Chelsea were able to relax a little and postpone such a wildly optimistic notion. Then Uefa's Michel Platini decided that allowing owners to pour in vast sums of money was distorting European football and so FFP was introduced. The issue of Abramovich's loans was resolved to an extent by converting them into equity, and when losses for the financial year 2008-09 were down to a mere £44.4m, the club had seemed to be moving in the right direction.

Yet the following year's figure shot up to £70m, and since then there has been a huge outlay on transfers – a net amount of £112.5m in 2011 as Fernando Torres and David Luiz were brought in last January and the likes of Juan Mata, Raul Meireles and Romelu Lukaku signed to support the new manager, Andre Villas-Boas, this summer.

Wages have increased every year and account for an unhealthy 82 per cent of turnover, compared with United's 46 per cent and Arsenal's 50 per cent. Then there is the issue of Stamford Bridge, suddenly in the spotlight last week when Chelsea Pitch Owners revealed the club want to buy their shares in the stadium in order to have the option of moving to a larger one.

Buck's intention of reducing fees and wages "a bit" would appear to be a rare example of American understatement. One way he hopes to do so is by producing more players like Josh McEachran through the academy. The second part of the equation, increasing income, is more important. Buck was speaking at the Leaders in Football conference at Stamford Bridge, one of the extra-mural activities providing a useful addition to turnover. Yet the ground cannot be expanded any further and match-day revenue is strictly limitedthere, with supporters already so upset by high ticket prices that they are proposing a boycott of the next Champions' League game, at home to Genk on Wednesday week.

Arsenal, by moving to the Emirates, with a 60,000 capacity, take almost £30m more than Chelsea on match days over the course of a season. Buck says of the ticket issue: "We're always looking at ticket prices and it's a balance between what the fans would like, which is basically free seats, and the realism of running a business that is trying to break even. We're comfortable that [the stadium for the game against] Genk is going to be full."

A new stadium is a huge long-term commitment and Buck openly admits he is not sure Chelsea would fill one. "Maybe with digital media and whatever, match-day crowds will stay flat or, who knows, even go down. In that sense maybe our stadium is the right size already and 75,000 in Manchester may be too much. We really don't know what the right-size stadium is for 10 or 20 years from now, just like Mr [Ken] Bates didn't know 15 years ago what the right size was for today."

What is left to improve? Commercial revenue and sponsorship, most promisingly by selling naming rights to the stadium. The club have made good strides in promoting their "brand" abroad, as was evident from the summer tour in Malaysia and Thailand, and they have just established an officein Singapore to chase sponsors.

The Samsung Bridge, or something like it? "Naming rights could be an important component," Buck admits. "We always were of the view that we couldn't rely on Mr Abramovich forever, it just wasn't appropriate. We had to figure out a way over the medium term to stand on our own two feet and maybe Financial Fair Play is making us do that a little bit quicker than we might have done otherwise."

News
Russell Brand was in typically combative form during his promotional interview with Newsnight's Evan Davis
peopleReports that Brand could stand for Mayor on an 'anti-politics' ticket
News
The clocks go forward an hour at 1am on Sunday 30 March
news
Arts and Entertainment
The Doctor finds himself in a forest version of London in Doctor Who episode 'In the Forest of the Night'
TVReview: Is the Doctor ever going stop frowning? Apparently not.
News
Voluminous silk drawers were worn by Queen Victoria
newsThe silk underwear is part of a growing trade in celebrity smalls
PROMOTED VIDEO
Have you tried new the Independent Digital Edition apps?
Sport
footballMatch report: Real fight back to ruin Argentinian's debut
News
Candidates with surnames that start with an A have an electoral advantage
newsVoters are biased towards names with letters near start of alphabet
Arts and Entertainment
Isis with Lord Grantham (Hugh Bonneville)
TV
Arts and Entertainment
Jay James
TVReview: Performances were stale and cheesier than a chunk of Blue Stilton left out for a month
Caption competition
Caption competition
Latest stories from i100

Bleacher Report

Daily Quiz
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

Wilko Johnson, now the bad news: musician splits with manager after police investigate assault claims

Wilko Johnson, now the bad news

Former Dr Feelgood splits with manager after police investigate assault claims
Mark Udall: The Democrat Senator with a fight on his hands ahead of the US midterm elections

Mark Udall: The Democrat Senator with a fight on his hands

The Senator for Colorado is for gay rights, for abortion rights – and in the Republicans’ sights as they threaten to take control of the Senate next month
New discoveries show more contact between far-flung prehistoric humans than had been thought

New discoveries show more contact between far-flung prehistoric humans than had been thought

Evidence found of contact between Easter Islanders and South America
Cerys Matthews reveals how her uncle taped 150 interviews for a biography of Dylan Thomas

Cerys Matthews on Dylan Thomas

The singer reveals how her uncle taped 150 interviews for a biography of the famous Welsh poet
DIY is not fun and we've finally realised this as a nation

Homebase closures: 'DIY is not fun'

Homebase has announced the closure of one in four of its stores. Nick Harding, who never did know his awl from his elbow, is glad to see the back of DIY
The Battle of the Five Armies: Air New Zealand releases new Hobbit-inspired in-flight video

Air New Zealand's wizard in-flight video

The airline has released a new Hobbit-inspired clip dubbed "The most epic safety video ever made"
Pumpkin spice is the flavour of the month - but can you stomach the sweetness?

Pumpkin spice is the flavour of the month

The combination of cinnamon, clove, nutmeg (and no actual pumpkin), now flavours everything from lattes to cream cheese in the US
11 best sonic skincare brushes

11 best sonic skincare brushes

Forget the flannel - take skincare to the next level by using your favourite cleanser with a sonic facial brush
Paul Scholes column: I'm not worried about Manchester United's defence - Chelsea test can be the making of Phil Jones and Marcos Rojo

Paul Scholes column

I'm not worried about Manchester United's defence - Chelsea test can be the making of Jones and Rojo
Frank Warren: Boxing has its problems but in all my time I've never seen a crooked fight

Frank Warren: Boxing has its problems but in all my time I've never seen a crooked fight

While other sports are stalked by corruption, we are an easy target for the critics
Jamie Roberts exclusive interview: 'I'm a man of my word – I'll stay in Paris'

Jamie Roberts: 'I'm a man of my word – I'll stay in Paris'

Wales centre says he’s not coming home but is looking to establish himself at Racing Métro
How could three tourists have been battered within an inch of their lives by a burglar in a plush London hotel?

A crime that reveals London's dark heart

How could three tourists have been battered within an inch of their lives by a burglar in a plush London hotel?