"Spend it if you've got it."
This should have been the theme for how Chelsea and the rest of the Premier League clubs conducted transfer business this summer.
Indeed, Premier League clubs spent a record £870 million, a 4% increase over last summer's £835m outlay. Chelsea, however, certainly had the means to spend big, and while the club certainly did spend, there seemed to be quite a bit left in the
Pogbank piggy bank.
With the new broadcasting deal kicking in next season, Premier League clubs, each of which are already among the world's forty highest-earning clubs, are about to further separate themselves from the rest of the world in terms of revenue, and and therefore, the resources for which to go out and procure the best available talent.
Additionally, the British pound, at its highest point this summer, was worth 14% more than at its highest point last summer compared to the Euro, giving English clubs a distinct spending advantage over their European counterparts.
The fact that Crystal Palace can buy Yohan Cabaye from Paris Saint-Germain, Leicester City can buy a Bundesliga striker who scored more goals than Thomas Muller over the past two seasons (Shinji Okazaki) and then follow that up with a Serie A star who captained his national team in the last two World Cups (Gokhan Inler), and Stoke City can sign a twenty-three year old winger who has already won the Champions League and has thousands of minutes played for two of the world's most storied clubs (Xherdan Shaqiri) should tell you everything you need to know about the amount of money already currently available to Premier League clubs.
And, the league is about to get even richer.
Starting next season, the 20 Premier League clubs will share an additional £700 million between them per year from the new domestic broadcasting deals the league signed with Sky and BT.
The additional £35 million in annual revenues each club will see doesn't even factor in the increases to all of the international rights deals. The new rights deal in the United States, for example, will see each club net an additional £2.66 million per year. This might not seem like a lot, but with the value of the Premier League rights exploding across the world, and the league being broadcast in well over 100 countries, the increases to all of the international rights deals will certainly add up.
The rest of the world understands full well the windfall Premier League clubs are about to enjoy, and you better believe that they will look to benefit from this themselves. Transfer fees will continue to skyrocket, as clubs with players who have caught the Premier League's eye will continue to extract a hefty premium, because they know English clubs can afford it.
I expect that the rate of inflation for transfer fees will spike far more than in the previous few seasons, and if a club had its eye on a player, this summer was the the time to buy.
For example, some might think Manchester City massively overpaid for Raheem Sterling earlier this summer. I disagree wholeheartedly, and would even argue that in a few years, even if Sterling shows only modest improvements to his game, he'll be considered a bargain.
Due to his unique situation, Liverpool did very well to get the £49m fee they did for Sterling's services, but he could easily be an £80m-rated player in a few years, and again, that's with just modest improvements.
Why, then, was Chelsea not more aggressive in the transfer market?
First, a bit of background on how Chelsea actually conducts transfer business.
Following the Barcelona friendly, I asked Jose Mourinho to describe how he works with Marina Granovskaia and Michael Emenalo during the summer transfer window to put together the strongest possible squad.
Mourinho told me "we started the process six months ago when we made our first report to the board. The board knows what we want, what we need, who we want to keep, who we'd like to sell."
He emphasised that everyone has their own role and that he enjoys a strong relationship with the board.
"With the board, they are getting the work from the technical point of view, after that, there is the financial point of view, and I never, NEVER, wanted to be involved in [the finances], it's not my area, and I don't want it to be."
"The board does what they are doing, all the time, very, very well for us, either buying or selling."
The board's trust in Mourinho should be evident, as they recently announced the manager's new, but long-expected, four-year contract. In fact, Marina Granovskaia marked the news with what I believe were her first public comments since she began working with Roman Abramovich straight out of university in 1997. So, this was clearly no small occasion.
On locking up Mourinho through at least 2019, Granovskaia said "We are very happy that Jose has committed four more years to the club. Since his arrival two years ago he has carefully developed the playing squad and brought trophies to Stamford Bridge. We look forward to the next four years and the continued success of the team."
The mutual trust and respect Mourinho, Abramovich, and the board of directors have in one another is clear.
Mourinho was recently asked whether the owner, the manager, or the players are the most important part of the club. He was quick to point out, quite practically, "without a great owner, you don't have a great coach or a great squad, because we are expensive." This might read a bit odd, but to hear him discuss it, it was clear that Mourinho's intent was to heap credit on Abramovich.
Priorties: superstars and young players with upside
I've been advocating for some time that Chelsea should be primarily focusing on 1) superstar talent and 2) young players with upside who can be bought and then sent on loan to ideally develop into a potential first team player or appreciate in value to be flipped for profit on the transfer market at a later date to help fund a superstar purchase.
Chelsea certainly focused on the latter, bringing in the likes of Baba Rahman (just turned 21), Kenedy (age 19), Nathan (age 19), Danilo Pantic (age 18), and Cristian Manea (just turned 18). Rahman and Kenedy remain with Chelsea's first team, while the others have joined the club's loan army.
There has been a bit of grumbling about Chelsea's innovation with regards to the loan system, but there is no question that it benefits all parties involved.
When a young player signs for Chelsea and is then sent on loan, he receives a massive wage increase and is provided with the opportunity to earn first-team football that just isn't possible at Stamford Bridge, where each of the eleven starters is an established star, both at the club level and on the international stage.
The loaning club gets the services of a talented young player that it wouldn't have otherwise been able to sign, and Chelsea gets help in developing their talented (and cost-effective) young players.
As for the former, superstar talent is hard to come by. To the club's credit, Chelsea seemed to do very well to replace Juan Cuadrado with Pedro, who I would consider just below that "superstar" designation.
Last month, Mourinho told me "who we'd like to bring [to Chelsea] is not always possible."
He reiterated this several times, admitting "there are some players that we would like to have, but it is impossible to do" and saying "we are calm, we have a good squad, but we know that there are some players that are impossible for us to have."
He recently echoed these sentiments in another press conference, stating "Is anyone in England interested in Thomas Müller? For sure. Can we, England, bring Thomas Müller from Bayern? I don’t think so."
"Does anyone want Messi? Can you bring him? I don’t think so. [Real Madrid, Barcelona, and Bayern Munich] are big clubs with big history, economically strong and stable, amazing income. I think they sell when they want to sell. When you see a player leave one of these big clubs you have to think it’s because they want him to go. That’s my feeling. I’m speaking about the ones who make the world stop. Big transfers. When does Messi leave Barcelona? When he finishes his career."
It certainly seems like Chelsea had a few particular targets in mind - namely Paul Pogba and John Stones - but if neither Juventus nor Everton were willing to play ball, there was nothing Chelsea could do about it.
As I wrote a few weeks ago, it wouldn't have made sense for Chelsea to spend another £100m+ on seven £15m players, simply because there aren't many £15m players that can upgrade the squad that Chelsea already has in place (this absolutely does not apply to young players with high ceilings, mind you).
Chelsea would be much better served spending superstar money on superstar talent.
That said, there's not exactly a huge pool of players that could walk into Chelsea's starting eleven (just ask Loic Remy, Radamel Falcao, Ramires, Filipe Luis, Juan Cuadrado, Andre Schurrle, Kevin De Bruyne, Romelu Lukaku, etc.), and for the relatively few players who could, they're either already playing for a huge club that can offer just as much as Chelsea can, or their club will be reluctant to let their marquee player leave, as we just saw this summer with Paul Pogba.
When one of these players does become available, however, Chelsea should naturally do whatever it can to bring him to Stamford Bridge.
Consider this summer's transfer market - how many players that were transferred this summer would start for Chelsea? We can cross off Kevin De Bruyne and Petr Cech pretty easily.
We could go through the rest one by one, but to me, it seems like Arturo Vidal, Morgan Schneiderlin, Raheem Sterling, and, had Chelsea not signed Pedro, Douglas Costa are the only players who I'm reasonably certain would have seen significant minutes at Chelsea this season (of course, I could be forgetting about a player or two or our opinions may differ, but the point remains: there's a very small group of available players who could've been difference-makers for Chelsea this season).
Sami Khedira might have helped before he got hurt and Nicolas Otamendi could have filled a need. Beyond that, who would have realistically stepped right into the lineup? I'm sure some of Aleksandar Mitrovic, Julian Draxler, Geoffrey Kondogbia, Paulo Dybala, and all of those young players Real Madrid signed will be great someday and would have made fantastic additions to the loan army or the end of Chelsea's bench, but Chelsea isn't going to land every player that Real Madrid, Bayern Munich, and Manchester City also wants.
So, to answer the question posited in the title: what went wrong for Chelsea this summer? It seems like they simply couldn't find a willing partner to engage in the blockbuster deal that they certainly had the means to complete and certainly seemed keen on completing.
Centreback depth certainly could have been addressed earlier in the window, a top defensive midfielder would have been nice, and I would have obviously loved to see Sterling join Chelsea, although early returns on Pedro seem to indicate he'll be a decent consolation prize. With that said, however, despite the early-season results, on paper, Chelsea actually has stronger side than they did last year when they won the title. Whether that will be enough to keep up with the likes of Manchester City, whose squad appears vastly improved, remains to be seen, but that's why matches are played, and with thirty-four left, it is still very much an open question.
Could Chelsea's hesitancy to spend more in the transfer market this summer be related to the cost of redeveloping Stamford Bridge?
No, Chelsea isn't Arsenal.
At Chelsea, the transfer budget and the stadium budget are two completely separate things.
That's the short version, but for those interested in the specifics, using money that should have been part of the transfer budget to offset stadium financing costs is exactly what Arsenal have done, despite vocal protests from minority owner, Alisher Usmanov.
Usmanov told Jeremy Wilson, in an excellent article, "The acquisition was financed with debt, which would be repaid through match-day revenues among other sources. There is another way of doing it: when shareholders buy all of the assets and contribute them to the club. As a result, these debt-free assets may generate income for the club. It is always up to the shareholders to choose which model to adopt."
"The board and main shareholders chose the debt option at the time, which led to Arsenal going almost 10 years without winning a domestic title or the Champions League. The first trophy only arrived in the 10th year. As a result of this choice, they were selling players and were unable to buy top players."
Usmanov (who happens to be one of the few people on the planet richer than Roman Abramovich) was more than willing to pay off the remaining stadium debt, and urged his fellow owners to invest in the club as well.
Majority owner Stan Kroenke refused, and instead decided that the club should pay a bank £20m per year in debt financing. That £20m per year could have easily funded the purchase of Karim Benzema or another top striker that always seems to elude Arsenal.
Debt financing siphons money from the club that could otherwise be spent on players, and choosing the Arsenal and Emirates way to finance the Stamford Bridge redevelopment would run totally contrary to everything Roman Abramovich has done during his ten-plus years at Chelsea.
Of course, Roman Abramovich is well within his rights to fund the estimated £500m cost of the stadium with club revenues, especially as he's already spent £1 billion on the club over the years, but it's just not the way Abramovich has ever operated. Chelsea appears to be Abramovich's passion, not his investment, and I expect that the club will remain under his and at some point, his children's, stewardship for quite some time.
In fact, when Chelsea provided its first update on stadium redevelopment process, the club specifically stated that the purpose of expanding Stamford Bridge is "driven by spectator demand for more seats and the need to increase stadium revenue to remain competitive with our major rivals, this revenue being especially important under Financial Fair Play rules."
Simply put, the driving force behind Chelsea redeveloping Stamford Bridge is to earn more revenues, which will then allow the club to spend more in the pursuit of fielding the most competitive squad possible.
As such, there shouldn't be anything to worry about with regards to transfer funds being used to offset stadium development costs.
For more on the finances involved in the Stamford Bridge redevelopment, including the case for lower ticket prices, see this entry from our season preview.