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MANAGING ARSENAL FOOTBALL CLUB
MANAGING ARSENAL FOOTBALL CLUB
PROJECT REPORT ON-
THE SUCCESSFUL MANAGEMENT OF ARSENAL F.C. IN TERMS OF ITS FINANCE AND MATCHDAY EXPERIENCE
HUZEFA M. SITABKHAN
UNDER THE GUIDANCE OF-
SUBMITTED TO THE UNIVERSITY OF MUMBAI IN PARTIAL FULFILLMENT OF THE REQUIREMENT
FOR THE AWARD OF BACHELOR OF MANAGEMENT STUDIES
ACADEMIC YEAR 2009-2010
MANAGING ARSENAL FOOTBALL CLUB
MANAGING ARSENAL FOOTBALL CLUB
I MR HUZEFA M. SITABKHAN OF H.R. COLLEGE OF COMMERCE
AND ECONOMICS OF T.Y.B.M.S (SEMESTER V) HEREBY DECLARE THAT
I HAVE COMPLETED THIS PROJECT ON MANAGING ARSENAL F.C IN THE ACADEMIC YEAR 2009-2010. THE INFORMATION SUBMITTED IS TRUE AND ORIGINAL TO THE BEST OF MY KNOWLEDGE.
___________________________ (SIGNATURE OF THE STUDENT)
THE INFORMATION SUBMITTED IS TRUE AND ORIGINAL TO THE BEST OF MY KNOWLEDGE _______________________ SIGNATURE OF PRINCIPLE GUIDE (MR NISHANT MEHTA) Team Sponsors- Commercial Partners- .S (SEMESTER V) HAS COMPLETED THIS PROJECT ON MANAGING ARSENAL F.M. COLLEGE OF COMMERCE AND ECONOMICS OF T.B.Y.R. SITABKHAN OF H.C IN THE ACADEMIC YEAR 2009-2010.4 MANAGING ARSENAL FOOTBALL CLUB MANAGING ARSENAL FOOTBALL CLUB CERTIFICATE I MR NISHANT MEHTA CERTIFY THAT MR HUZEFA M.
INDU SHAHANI AND WOULD LIKE TO THANK THE HEAD OF THE B. THE COMPILATION OF THIS PROJECT IS A MILESTONE IN THE LIFE OF A MANAGEMENT STUDENT AND ITS EXECUTION IS IMPOSSIBLE WITHOUT THE COOPERATION OFTHE PROJECT GUIDE.S DEPARTMENT PROF. I WISH TO RECORD A DEEP SENSE OF RESPECT AND GRATITUDE TO MY PROJECT GUIDE MR. I WOULD ALSO TAKE THIS OPPURTUNITY TO EXPRESS MY DEEP REGARDS AND GRATITUDE TO THE PRINCIPLE. IT IS MY PROUD PRIVILEGE TO EXPRESS MY DEEP SENSE OF APPRECIATION AND GRATITUDE TO MY PARENTS AND FRIENDS FOR THEIR SUPPORT AND COOPERATION IN THE COURSE OF THE PROJECT EITHER DIRECTLY OR INDIRECTLY INVOLVED IN TIME WITH THEIR VALUABLE CONTRIBUTION. I WOULD ALSO LIKE TO ACKNOWLEDGE VARIOUS AUTHORS FOR MAKING AVAILABLE VALUABLE INFORMATION LIBERALLY. IT IS DUE TO THE ENDURING EFFORTS AND GUIDANCE OF MY GUIDE THAT ULTIMATELY MADE IT A SUCCESS. WHICH I FEEL IS AN OPPURTUNITY TO EXPRESS MY VIEWS ABOUT MANAGING ARSENAL FOOTBALL CLUB.DR. GEHNA HINGORANI WHO GAVE US GUIDANCE TO TAKE UP AND PURSUE THIS PROJECT.M. Team Sponsors- Commercial Partners- . MRS.5 MANAGING ARSENAL FOOTBALL CLUB ACKNOWLEDGEMENT IT IS A MATTER OF GREAT PLEASURE AND PRIVELAGE TO PRESENT THIS PROJECT REPORT ON MANAGING ARSENAL FOOTBALL CLUB. I CANNOT JUST CONDONE THE VALUABLE OPPURTUNITY GIVEN TO ME BY THE UNIVERSITY OF MUMBAI FOR COMPILING AND SUBMITTING THIS PROJECT. NISHANT MEHTA FOR HIS ENCOURAGEMENT THROUGH THE COURSE OF MY WORK.
it is a known fact these days that a club can be µsuccessful¶ onl by carefully y managing its finances and administration. So are current Barcelona. Although the club has not managed to win a trophy in 4 seasons of the premier league its fan base keeps on increasing due to the clubs style of playing on the pitchand due to the clubs management of the pitch. Although in some rare cases this circumstance may hold true. spends less on buying established players and diverts th funds into ose Team Sponsors- Commercial Partners- .086 billion.) 2) Management of the clubs Finances (includes how the club follows a strict wage structure. Chelsea etc. who due their large amounts of debts last season almost faced rustication from the Barclays Premier League and in the end were given a 20 points deduction which eventually lead to their relegation from the premier league But now i shall speak about what i have covered as a topic. which has been managed so beautifully that even after purchasing a new stadium in recentyears. Even banks refuse to fund such clubs that are financially unstable. Chelsea (who reportedly make losses of about ¼ 40-50 million every financial year and the only way they are able to withstand it is due to a rich owner Roman Abrahimovic who has a high net worth) and other top clubs from various European countries. Success off the pitch is more vital than success on it because only then can a football club run its proceedings in a smooth manner For instance Real Madrid one of the most successful clubs in Spain is nearly ¼ 500 million in debt due to excess spending on transfers and salaries of its star studded team. In this project I have covered 2 aspects of the clubs management that ha led to its success of the pitch:1) Administration on Match day (includes how well it manages/treats its fans on the day of the match such that more and more supporters of the club living in and around the London are buying entire season tickets. Having such high amounts of debts especially during such recessionary times can prove lethal in the clubs downfall unless the club is owned by a billionaire (like Manchester City. Manchester United the single most successful club in England is facing de worth an bts estimated ¼ 1. (taken on loan) µThe EMIRATES Stadium¶ the club still manages to churn out profits. An evident example of such a club is Portsmouth. win trophies and goes for glory.). A top club µArsenal¶.6 MANAGING ARSENAL FOOTBALL CLUB ABSTRACT In recent times fans relate a successful football club to that which is successful on the pitch.
¶ Team Sponsors- Commercial Partners- .) My aim is to convince my readers by the end of my project with the help of statistical data that µsuccess on the pitch does not always guarantee success of the pitch. gives value for money to its fans for their season tickets.7 MANAGING ARSENAL FOOTBALL CLUB developing home-grown young talents.
1) INTRODUCTION SUB HEADING PAGE NO.) 17 a) b) History of Arsenal Football Club Current Successes of the Club(last decade) and information about the board of directors and other personnel Research methodology 17-19 19-24 3) Arsenal football club improves the Match day experience for 60. The hypothesis and a brief introduction to the sport 10-11 a) What is Football as a profitable business 11-15 b) The huge amounts of money that goes into making this sport a success.C.000 fans with integrated it management. (Administration) 25-38 4) Managing of Finances and administration at Arsenal Football 38 Team Sponsors- Commercial Partners- . players who are paid exorbitant amounts as salaries per week 16-17 2) MAIN BODY Concentrating on Arsenal Football Club(A.F.8 MANAGING ARSENAL FOOTBALL CLUB TABLE OF CONTENT SERIAL MAIN HEADING NO.
rights -Shirt sponsor/Stadium Sponsorship(EMIRATES) income c) Main sources of EXPENSES -Players and Manager/coaches salaries -Repayment of loan for the Emirates Stadium A final sum up of Arsenal¶s finances for the last year as compared to other top clubs d) 5) 6) 7) CONCLUSION BIBLIOGRAPHY ANNEXURES Testing the Hypothesis 52 52 53 54-62 46-51 38-41 41-46 Team Sponsors- Commercial Partners- .V.A. UEFA Champions League.9 MANAGING ARSENAL FOOTBALL CLUB Club a) b) Structure of finance at the Club Main sources of finance(INCOMES) -Transfer income -Participation income from various competitions like the Barclays Premier league. Online -Merchandise Income -T.V. Cup -Subscription fees from Arsenal T. F.
Team Sponsors- Commercial Partners- . either a draw is declared or the game goes into extra time and/or a penalty shootout.000 inhabitants. The object of the game is to score by driving the ball into the opposing goal. It is the most popular sport in the world. If the score is tied at the end of the game. occasionally using their torso or head to intercept a ball in midair. more commonly known as football or soccer. the rest of the team usually use their feet to kick the ball into position. The game is played on a rectangular grass or artificial turf field.10 MANAGING ARSENAL FOOTBALL CLUB INTRODUCTION The hypothesis for this project is ± ³Success on the pitch (by way of winning trophies and competition for a s) club doesn¶t always guarantee the Success off-the pitch (in terms of financial solvency. In general play. excellent management and financial success in terms of profits every year) ´ A BRIEF INTRODUCTION TO FOOTBALL AS A µSPORT¶ Association football. is a team sport played between two teams of eleven players using a spherical ball. with a goal in the centre of each of the short ends. The team that scores the most goals by the end of the match wins. The various shades of green and red indicate the number of players per 1. Map showing the popularity of football around the world. the goalkeepers are the only players allowed to use their hands or arms to propel the ball. depending on the format of the competition.
these are: y y y Asia: Asian Football Confederation (AFC) Africa: Confederation of African Football (CAF) Central/North America & Caribbean: Confederation of North.05.01. 04.3 billion.com staff. The FIFA headquarters are located in Zürich.S. but it is almost everywhere else -.which means it is worth big bucks.Forbes. which tops our latest annual rankings of the most valuable soccer teams. Central American and Caribbean Association Football (CONCACAF) Europe: Union of European Football Associations (UEFA) Oceania: Oceania Football Confederation (OFC) South America: Confederación Sudamericana de Fútbol/Confederação Sul americana de Futebol (South American Football Confederation. We reckon Manchester United. 3:00 PM ET Soccer is not the most popular sport in the U. Six regional confederations are associated with FIFA. such asfutsal and beach soccer) is the Fédération Internationale de Football Association (FIFA).11 MANAGING ARSENAL FOOTBALL CLUB GOVERNING BODIES The recognised international governing body of football (and associated games. CONMEBOL) y y y INTRODUCTION A BRIEF INTRODUCTION TO FOOTBALL AS A µBUSINESS¶ AND SUCCESS OF THE SPORT WORLD-WIDE Article-³The Richest Soccer Teams´ Source. more than the most valuable franchise in the National Team Sponsors- Commercial Partners- . to be worth $1.
is spending off the pitch too (See "Russian Roulette").people ). The ensuing financial crisis forced Leeds to sell off its best players and the team fell out of the top division of English soccer. Soccer's global audience. Manchester United has a $38 million sponsorship deal with Nike (NYSE: NKE .news .12 MANAGING ARSENAL FOOTBALL CLUB Football League.S. Abramovich will find that betting the house on star players spe disaster if they don't lls deliver. as chief executive--the very man who made Manchester United a merchandising powerhouse. Leeds United fell into bankruptcy after a spending spree on high -wage players failed to deliver European success. the New York Yankees ($832 million). Coca-Cola (nyse: KO . according to some calculations. Manchester United and Real Madrid are at the forefront of turning football teams into global brands earning more money from broadcasting and merchandising than from ticket sales.people ) and Anheuser-Busch (nyse: BUD . he is trying to extend his celebrity beyond his playingday¶s à la Michael Jordan.people ) and Pepsi (nyse: PEP . now at rival Real Madrid.news .news . Both are eying the lucrative emerging Asian market where home -grown teams and stars are not yet sufficient to satisfy the hunger for the sport. is thought to have doubled his new employer's merchandising sales. who bought heavily indebted Chelsea two years ago and who has spent lavishly on building a world -class team. Beckham is the nearest soccer has to a one man brand (See " Brand Beckham"). the Portuguese midfielder Luis Figo. Beckham has a huge following among Asians. earns millions of dollars in sponsorship from Gillette (nyse: G . Expatriate Russian billionaire Roman Abramovich.people ) (See "Soccer Pitchmen"). He has lured top coach José Mourinho from FC Porto and hired Peter Kenyon. the Washington Redskins ($1.1 billion).news people). The $40 million transfer fee Real Madrid paid Manchester United to buy Beckham in 2003 could be recouped with just four years sales of replica uniforms.news people ) among others. multinationals like General Motors (nyse: GM . Man U's former star. David Beckham. As he passes the apex of a famous career.news . and substantially more than baseball's most globally recognized team. particularly free -spending Japanese teenagers. unmatched by any other professional team sport means Europe's top teams--and stars--attract millions of dollars in sponsorship from U. The "galáctico" (megastar) that Real Madrid bought before Beckham. which cost it dearly in lost Team Sponsors- Commercial Partners- .
.Article Source: http://EzineArticles. Delfines de Los Cabos is one of the youngest teams in Mexico¶s very competitive professional 2nd Division Premier Promotional league.the sickening feeling in the stomach. Sports betting is increasingly becoming an emerging online business. if you get involved with the right sport. Live telecast of matches further intensify the excitement. Article-Professional Sports can be a Profitable Business Source. Leeds is now majority owned by Ken Bates. Bookmakers' statistics revealed that soccer betting is the most popular among sports betting. Billions of $$$ are wagered on every match day. most played and the highest grossing sport on the planet. playing out of beautiful Cabo San Lucas. Soccer is the most watched. the joy.com/?expert=Stanley_O Professional Sports Franchise can be a profitable business. 1 because it is a sport that can stir up so much passion. Team Sponsors- Commercial Partners- . fantastic or reckless finishes. It is No.. the man who sold Chelsea to Abramovich. the elation. players pushing their human bodies to the limit or playing like zombies. and it makes the adrenaline flows faster and more intense. the right franchise or team. As an ironic twist of fate.13 MANAGING ARSENAL FOOTBALL CLUB broadcasting revenue. Its pure entertainment. the anger. one of the countries leading tourism destinations and calling the Don Koll Seaside stadium home qualified for the quarter finals losing to the perennial leagua champion Universidad del Futbol that is a full fledged farm team for the Pachuca powerhouse 1st Division club. Each game is loaded with suspense. This cocktail of emotions can be experienced in every match . in the the right place at the right time«Winning soccer franchise in Cabo San Lucas Mexico is on the block. Why Soccer Is The King Of All Sports Soccer is the King of all sports because it is a simple game so easily understood.
punters can now know how the match unfolds as the odds tell a story. in-play betting. that is why names like Maradona and Pele resonate across the world. half time score. in-game betting and running ball). The movement of the odds is an indication of the performance of the teams play at that ing time. full time score. half time over/under. So the odds movements tell the "scenario" from the bookmakers' point of view which cannot be far off. The ability to 'decode the odds and read the game' is the recipe for live bettingsuccess. The Odds Tell A Story Many savvy punters now recognize the main difference between live bets and normal bets. There is a wide variety of live bets available for punting such as Asian Handicap betting. The Internet and live telecasting of soccer matches have made soccer live betting immensely popular. Soccer carries the largest fan base in the world of sports. to cut loss when necessary to limit the financial damage. number of corners half time. punters used past data and analysis to determine their bets. Bookmakers adjust the odds by minutes or even seconds according to the level of play of the teams. But with live bets. full time over/under.14 MANAGING ARSENAL FOOTBALL CLUB At its best soccer is considered magic. Before the introduction of live betting. From the odds changes. etc. the punter must be able to identify the odds indicators on the exact time to bet. Profitable Live Bets On Every Match Day Team Sponsors- Commercial Partners- . number of corners full time. More and more games are being televised live which means more games are offered for live betting than in any other sports niche. that is. (*Live betting is also known as in-running betting. and also the time to exit the bet.
He has extensive experience in soccer betting. The #1 complete soccer live betting system available containing 10 winning strategies with STEP-BY-STEP screenshots showing you how to spot and make profitable live bets. You do not need complex technical analysis to find them and profit from them. during the course of the game. Be sure to claim a free copy of the winning "Midweek Strategy" by visiting Team Sponsors- Commercial Partners- . you have to win the game. Stanley O is a Chartered Accountant and soccer has been his passion since young. and the last 10 minutes of the match. But the punter must know how to spot them to take profitable actions. Think about how many games are being played onevery match day during the soccer season. The key lies in the ability to identify them and profit from these opportunities. In card games. You can "crack" the soccer live betting market and make the "big bucks" once you know how to identify the money making indicators in the odds movement. there are numerous punting opportunities.15 MANAGING ARSENAL FOOTBALL CLUB In every match. the odds indicators are profit opportunities. There are profitable live bets to be made in the first 20 minutes of play. if you want to win. you really don't know what you have been missing. In live betting. But the beauty of soccer live betting is you can still WIN if you have betted on the losing team. Have A Slice Of The Lucrative Soccer Live Betting Pie Soccer live betting is absolutely insane right now! There's never been a better time for punters to get in on the live betting bandwagon and have a slice of the lucrative soccer live betting pie. If you have never engaged in soccer live betting experience. It's all about timing. That's plenty of games begging for your action.
8m 4) Kaka (Real Madrid. semi pros. Argentina) ¼33m/£29.³Crazy amounts paid to players?´ Source. But do you know that a world class player can get paid up to £100. jeffrimsblogspot. a football team needs eleven players playing during a game. Por) ¼30m/£26.000 on a weekly basis? That is more than my mother's annual salary working a government nurse here in Malaysia! How can a person lands that amount of money just by running around kicking a football.5m 2) David Beckham (LA Galaxy. where professional football clubs make money from competing against each other on several levels. It started as a game for leisure. Eng) ¼30. and the highest level of all. Brazil) ¼18. France) ¼18m/£16m Team Sponsors- Commercial Partners- .8m/£16. for which can be classified from amateurs. but somehow it has evolved into an industry.com It pays to be a great footballer Football or soccer has been around for many years.8m 5) Thierry Henry (Barcelona.2m 3) Cristiano Ronaldo (Real Madrid. by sponsorship and also TV rights.16 MANAGING ARSENAL FOOTBALL CLUB EXHORBITANT AMOUNTS OF MONEY PAID TO THE PLAYERS Article. world class players. As a team sport. then you can join a game of football.4m/£27.http:/. pros. There are too many football players on Earth. What set these world class players apart from the rest of the players? If you can run and kick a ball. week in and week out? TOP TEN HIGHEST PAID FOOTBALLERS 1) Leo Messi (Barcelona.
3m. Argentina) ¼15. 7) Carlos Tevez (Manchester City. Their first home games were played on Plumstead Common until a site at Manor Field in Plumstead was found in 1888 and a stadium of sorts built there. 8) Zlatan Ibrahimovic (Barcelona. David Danskin was the man who collected the subs. the historic date being 19 November 1887.3m. HISTORY OF THE CLUB (1886) Arsenal's origins can be traced back to a group of workers in the armament works in South London in 1886. other notable names were Fred Beardsley.8m/£12. Among the early matches was the first recorded against Spurs.C. on Tottenham Marshes which the old enemy won 2-1. the goalkeeper who had previously played for Nottingham Forest. and Jack Humble.4m/£13. At Christmas that year they decided they needed a new name.7m. Team Sponsors- Commercial Partners- .5m/£12. Beardsley's connections also persuaded Nottingham Forest to donate a set of shirts to the new club. and Arsenal have worn red ever since. 10)Samuel Eto¶o (Internazionale.9.17 MANAGING ARSENAL FOOTBALL CLUB 6) Ronaldinho (AC Milan. MAIN BODY CONCENTRATING ON ARSENAL F.6m. Cameroon) ¼13. later to become secretary and chairman. 9) Frank Lampard (Chelsea. and called their club Royal Arsenal. Brazil) ¼17. Sweden) ¼14.2m/£15. In October that year they clubbed together and each paid a subscription to form the club that was at first called Dial Square after the name of the workshop in which most of them worked. H umble became the unofficial historian by virtue of being associated with the club in it's early days longer than anyone else. England) ¼14.2/£12.
Freddie Cox scored direct from a corner. The following year. and the replay was won 1-0 in extra time. The club was also once again in a precarious financial position because of the cost of building the new East and West stands. and saw the four year run of unbroken success come to an end withonly a 3rd place finish in the league. which still stand today. In 1890 they moved to a new ground. and Arsenal again won the FA Cup by beating Sheffield United 1-0 in the final at Wembley. Ronnie Rook and Joe Mercer. a defensive record unmatched until the double season of 1971. arrived. the London Senior Cup in the 90-91 season. The following year was Alex James' last at the club. with the Gunners again coming from 2-0 down in the semi-final to force a 2-2 draw against Chelsea. brought Arsenal's 5th league title in seven years. the last before the war. the Invicta. Only 32 goals were conceded that year. but Drake created a record by scoring seven goals in a league match against Aston Villa. and only 5th place was achieved the following season. 1937-38. but also the arrival of two more great names. The year after that though. saw only a 13th place finish in the league. but with limited success. Royal Arsenal grew quickly in the 1890s mostly due to the large influx of migrant workers to the armament works because of rearmament at the time in response to the perceived French threat. though the team was now generally held to be in decline. 1946-47. and the league title duly arrived at it's rightful home.18 MANAGING ARSENAL FOOTBALL CLUB The club first entered the FA Cup in 1889. to get back to 2-1. In 1935-36 Arsenal finished only 6th in the league. Liverpool were defeated 2-0 in the final. The following year the FA Cup was won once again. one of the great strikers. just down the road. After the war a great team rose once again. Team Sponsors- Commercial Partners- . beating St Bartholomew's 6-0 at the Oval. Booming post-war attendances eased the financial situation and the first season. By 1891 Royal Arsenal had won all the regional trophies available in London. trainer Tom Whittaker took over as manager. In 1948-49 Arsenal finished 5th in the league and Doug Lishman. including the foremost trophy.
in 1993-94. fourth. During the Team Sponsors- Commercial Partners- . a Cup Double. 1950-51. though things might have been different had Lishman not broken his leg early in the season. two League title wins in 1988-89 and 1990-91. and success in European football. The Double-winning side. in 1969-70. being just 3 wins away from the elusive double. Arsenal won the League Cup in 1986-87. and won the Premier League in 2003-04 without losing a single match. In 1951 Arsenal -52 once more were runners-up in both league and FA Cup. APPOINTMENT OF ARSENE WENGER Arsenal fifth period of success came with the appointment of Arsène Wenger in 1996. Graham's reputation was tarnished when it was revealed that he had taken kickbacks for signing certain players and he was sacked in 1995. their first European trophy. Alex James died in 1954 and the death of Tom Whittaker in 1956 presaged a decline in the fortunes of the great club until the resurgence of the late sixties CURRENT SUCCESSES AT THE CLUB (LAST DECADE) The history of Arsenal Football Club from 1966 to the present day covers the third. Arsenal won the Inter-Cities Fairs Cup. including three Doubles. and lost 2-1 against FC Barcelona. was soon broken up and the following decade was characterised by a series of near misses: Arsenal lost three FA Cup finals (1971-72. The club's only success during this time was an FA Cup win in 1978-79 against Manchester United. the FA Cup and League Cup double in 1992-93 and a second European trophy. However. the return of former player George Graham as manager in 1986 brought a third period of glory. before the league championship was once more won in 1953. on goal average from Preston. In addition. and their first League and FA Cup double in 1970-71. the Cup Winners' Cup. Arsenal could only finish 5th in the league. and fifth periods of success in Arsenal's history. Under him.19 MANAGING ARSENAL FOOTBALL CLUB The year after that. 1977-78. In 2005-06 became the first London club to reach the UEFA Champions League Final. the club were victorious in the 2002-03 and 2004-05 FA Cups. After stagnation in the 1980s. Following Bertie Mee's appointment in 1966. Arsenal won a second league and cup double in 1997-98 and then a third in 2001-02. and 1979-80 and the 1979-80 Cup Winners' Cup final on penalties. however.
but Highbury's capacity was limited to only 38.µTHE EMIRATES¶ THE PRIDE OF NORTH LONDON Arsenal have been highly successful in the 1990s and 2000s. they left their longstanding home of Highbury to the new Emirates Stadium nearby. construction started in December 2002 with the demolition of buildings on the site. ready for the start of the 2006-07 season. NEW STADIUM. Team Sponsors- Commercial Partners- . the new Emirates Stadium opened.20 MANAGING ARSENAL FOOTBALL CLUB following close season. With expansion of Highbury ruled impossible. Arsenal announced plans to move down the road toAshburton Grove. in 1999.500 in the post-Taylor report era. virtually every match was sold out and the club were unable to maximise matchday revenue. and in July 2006.
as they won the Premiership unbeaten (26 wins. They became only the second team to do so. but the defeat to Leeds would be Arsenal's last in the League for over a year. 12 draws.21 MANAGING ARSENAL FOOTBALL CLUB THE INVINCIBLES SEASON OF 2003-04 Little did they know it at the time. in successive matches. 0 defeats). respectively. Faced with the potential collapse of their season. Their rivals for the title gained revenge in other competitions . Arsenal recovered from being 1-0 and 2-1 behind to Liverpool in their next league match to win 4-2. Team Sponsors- Commercial Partners- . and went on to win the league with a 2-2 draw away to Tottenham Hotspur.Arsenal were defeated in the Champions League quarter-finals and FA Cup semi-finals by Chelsea and Manchester United. though Preston had only played 22 games in their own unbeaten league season. thanks to a Thierry Henry hat-trick. mimicking their success in 1971. 2003-04 was a record-breaking season for Arsenal. finishing a clear 11 points ahead of second-place Chelsea. the first having been Preston North End in 1888-89.
MANAGING ARSENAL FOOTBALL CLUB Arsenal were unable to retain the title in 2004-05, finishing second, 12 points behind a record-breaking Chelsea side. However, the Gunners did stretch their unbeaten run to 49 consecutive matches, an English league football record; the rec was equalled with a ord dramatic 5-3 win over Middlesbrough (Arsenal having trailed 3-1 shortly after half-time) and then surpassed with a 3-0 win over Blackburn Rovers in August 2004, before it was ended with a 2-0 away defeat by Manchester United. This defeat arguably upset the team's form and they fell away from title contention before recovering with a late flourish to finish second, sealed with a 7-0 drubbing of Everton. Champions League glory eluded them again, with the club getting knocked out 3 on -2 aggregate by Bayern Munich in the second round. Arsenal did not end the season empty handed; they came away with their third FA Cup in four years, winning 5 on penalties after -4 a 0-0 draw against Manchester United. Weakened by the sale of skipper Patrick Vieira to Juventus in the summer of 2005, Arsenal's 2005-06 season was comparatively disappointing domestically and theclub failed to challenge for any trophies at home. In the league, their poor away form dogged them and despite recording some impressive wins at home (5-0 over Aston Villa, and 7-0 over Middlesbrough), Arsenal spent much of the latter stages of the season in fifth place or lower, and looked set to miss out on the Champions League for the first time since 1997.
However, they won their last three matches of the season, culminating in a 4-2 victory over Wigan Athletic in the last ever match at Highbury; coupled with Tottenham Hotspur's loss at West Ham United the same day, this meant Arsenal pipped Spurs to fourth place and a Champions League spot.
In contrast to their domestic form, Arsenal's form in Europe in 2005 was much stronger; -06 they reached the UEFA Champions League final for the first time in their history, becoming the first London club ever to do so. Arsenal finished top of their group unbeaten, aboveAjax Amsterdam, FC Thun and Sparta Prague against whom Thierry Henry scored two goals on away to become the all time record goalscorer for Arsenal; in the knockout stages they beat
MANAGING ARSENAL FOOTBALL CLUB Real Madrid (becoming the first British team to beat Real at the Bernabéu), Juventus and then Villarreal to reach the final, setting a competition record of ten matches without conceding a goal in the process.
MANAGING ARSENAL FOOTBALL CLUB
THE BOARD OF DIRECTORS AND OTHER KEY PERSONNEL AT THE CLUB
Challenge With only 30 match days a year.25 MANAGING ARSENAL FOOTBALL CLUB ARSENAL FOOTBALL CLUB IMPROVES THE MATCH DAY EXPERIENCE FOR 60. 500 hospitality and retail tills and 100-plus turnstiles are all operating at optimum performance on match day. it must be aligned to business objectives and integrated with core operational processes. head of IT at Arsenal FC. It must therefore ensure that every match is a positive experience for the thousand of fans s who attend its Emirates Stadium.´ For IT to facilitate the modernisation and transformation of a football club. The performance and reliability of these systems is absolutely vital. We can¶t afford for a Team Sponsors- Commercial Partners- . At the heart of the Emirates Stadium is a suite of new hospitality and entertainment systems that control everything from the entrance turnstiles to the video replays in the executive box. offering a wide variety ofservices that rely on a range of new IT solutions designed to improve and streamline every aspect of the club¶s business. ³The new systems are more complex and more sophisticated than anything we had at Highbury.000 FANS WITH INTEGRATED IT MANAGEMENT. and we need to manage them proactively and address any performance issues before they become apparent to the customer. As Paul Farmer. With these systems all reliant on the club¶s back-end infrastructure and network. ³Clubs need to maximise revenues so that they can invest in the best players. ³To achieve commercial success we need to put the infrastructure in place to support our ambitions. IT availability and business continuity are of paramount importance to Arsenal.´ comments Ford. This means ensuring that the stadium¶s 450 television screens. explains. which includes IT. Solution-Aligning IT to business strategy The new stadium is a radical departure from Highbury. and continue to perform at the highest levels. Arsenal Football Club (FC) has a limited number of opportunities to boost revenue and customer loyalty.
for example.´ Optimised service management To ensure that the club¶s core operations were not impacted by techn ology performance problems. The Emirates stadium boasts more than 500 highly specialised hospitality EPOS devices and 450 entertainment screens ² double the number used at Highbury ² all of which can be managed through a single centralised CA management console. I can¶t think of any other way we could be confident of 500 tills all working perfectly on match day. the club has adopted an integrated approach to Enterprise IT Management (EITM).´ As a result. ³Without CA¶s solution.´ says Farmer. we know about it before the user does ² and we can fix it before business continuity is affected. Arsenal needed an integrated IT management solution that would provide constant visibility and control of its enterprise systems.26 MANAGING ARSENAL FOOTBALL CLUB turnstile to stop working on a Saturday afternoon a couple of hours before kick -off. Change & Configuration Management and Dynamic & Virtual Team Sponsors- Commercial Partners- . IT & Financial Asset Management. Founded on CA solutions for Incident & Problem Management. ³If there¶s a problem with an electronic point of sale (EPOS) till on a catering outlet. including Unicenter Network and Systems Management. The new management solution also allows Arsenal to measure its IT performance according to key business priorities. This solution is founded on a range of technologies from CA. Arsenal is able to manage a much larger IT infrastructure without needing to invest in new IT support personnel. Arsenal has been able to reduce the complexity of managing its IT infrastructure and in particular the applications that u nderpin core customer services at the stadium. Unicenter Service Level Management and Unicenter Management Portal. By combining these with its existing CA software. Opportunity To ensure that its systems meet customer expectations. which aids investment and resource allocation. Recovery Management. Information Governance.
Benefits By ensuring that its stadium systems are fully operational on match day. automated alerts. Thanks to Web -enabled sales and delivery channels. the customer experience on match day is vital. As a result. which can make a significant difference in competitive advantage and customer satisfaction. Team Sponsors- Commercial Partners- . By introducing real-time data replication. which means less systems downtime. Yet with an average of just 30 match days a year. and will help to support the ongoing transformation and growth of Arsenal FC. regular device polling and remote monitoring. As a result. IT efficiency and business continuity have also increased. the club now has a centralised and standardised platform for managing IT. Meeting customer expectations The customer experience is everything in today¶s global market.27 MANAGING ARSENAL FOOTBALL CLUB Systems Management. Although football clubs enjoy higher customer loyalty rates than other sectors. companies need to be able to constantly evolve their off erings to provide customers with faster and better services. Arsenal Football Club has: Improved the customer experience Protected competitive advantage Increased profitability These factors are all key to the success of the club both as a business and as a football team. the chance for football clubs to make an impression and boost revenue is much more limited than most businesses. This innovation process invariably involves implementing new IT systems. they still need to compete for fans¶ spending power as well as corporate hospitality business. consumers now have a much wider choice available to them² and won¶t hesitate to switch suppliers if they are unhappy with service or product quality.
Arsena is now a global brand. This is a massive departure from the club¶s previous stadium and has led to a heightened need for IT availability.000 geneal r admission fans. ³Football is still very much about what happens on the pitch. Everything from accessing the stadium and purchasing refreshments to watching televised replays is controlled by IT.´ Keeping match day systems operational To offer such services. Football is now a multi-million pound business. and clubs need a healthy balance sheet to attract the best players in the game and retain their league status. comments.000 capacity stadium at the start of the 2006/07 season. As a result. but also underpins critical customer-facing services on match day. IT not only plays an important role in the general management of the club and the stadium. ³To achieve commercial success we needed to put the infrastructure in place to support our ambitions. Adrian Ford. To meet the expectations of an ever-growing fan base. and we l want to offer services that match up to our reputation.´ comments Ford. the club moved to a new 60. This ultra-modern facility has been specifically designed to enhance the match experience for fans² particularly for the club¶s 9. In 2007. Team Sponsors- Commercial Partners- . London¶s Arsenal Football Club (FC) has enjoyed success both on and off the pich. which included IT. but the modern football ecosystem also requires commercial success to enable sustained sporting achievement.000 premium customers who generate almost as much revenue as the other 51. t the club made a total operatig profit of more than £24 million and in 2006/07 once again finished in the top three of the UK¶s FA Premier League.28 MANAGING ARSENAL FOOTBALL CLUB Maximising revenue generation to support sporting achievement Failure to maximise revenue opportunities on match day can have massive conseq uences for a club. Arsenal FC invested heavily in new technology for its Emirates Stadium. Commercial Director for Arsenal FC.
which is dependent on the club¶s servers and network. which are operated using proximity smartcards. ³At our previous stadium. The PDAs. The old approach of paper-based tickets is long gone and has been replaced with automated turnstiles. Stewards also carry personal digital assistants (PDAs) that can be used to pull up card details from the club¶s access system to help resolve entry problems.29 MANAGING ARSENAL FOOTBALL CLUB The club¶s IT infrastructure now boasts: 60 servers 450 screens 350 desktop computers 500 hospitality tills 50 retail points of sale 100-plus turnstiles All these components. which run off 80 wireless access points. so we could afford to be more reactive. Providing consistent services to staff. and provides a real-time count of the number of supporters in attendance. can also be programmed to send an alert if a particular card is used to enter the stadium² for example if a supporter¶s card has been reported stolen. the entire customer experience relies on our technology so it¶s vital that our IT systems are highly available. Police officers use this data. explains. As Paul Farmer. Head of IT at Arsenal FC. IT was important to the business but not to match day operations. which includes a breakdown for different stands and areas. This sophisticated access control system ensures that only those fans with a valid ticket are admitted to the stadium.000 people safely into the grounds within just a couple of hours on match day is no easy feat. The access system. to manage health and safety and crowd control at the match. must operate at optimum performance on match day ² or fans will soon be impacted. At the Emirates Stadium.´ Controlling access to the stadium Access control is particularly important at the Emirates Stadium ² getting 60. the media and fans Team Sponsors- Commercial Partners- . along with the club¶s network. are also used by stewards to help fans find their seats.
and post-match interviews and advertising.´ Guaranteeing business continuity through proactive IT management To safeguard its business-critical systems. The screens broadcast Arsenal television. ³We need to be monitoring our key servers and network. which must be available 24x7 for supporters to purchase their match day tickets. any network failure would instantly impact these screens ² and 60. Arsenal FC provides both wireless and fixed port Internet access for journalists and photographers to upload reports and images on match day. so that any issues can be identified and dealt with before they affect the performance of our systems or indeed our match day operation. it is important that the club can guarantee t e h availability of its network to support the system. pre. IT also supports the club¶s e-ticketing system. Although the system has inbuilt resilience and no single point of failure. Away from the stadium. such as: Incident & Problem Management IT & Financial Asset Management Information Governance Team Sponsors- Commercial Partners- . the club¶s IT infrastructure is also critical to the operation of 450 high-definition Sony screens. which includes live match coverage. Arsenal FC has adopted CA¶s Enterprise IT Management strategy (EITM). the club¶s IT department must adhere to stringent internal service level agreements (SLAs).30 MANAGING ARSENAL FOOTBALL CLUB In addition to supporting the stadium¶s access system. To ensure that the club¶s 350 users have reliable access to these systems. The club also offers Internet access as part of its hospitality package to help further enhance the customer experience. such as finance and email.000 fans¶ visual enjoyment of the game. Based on Internet Protocol (IP). In order to meet these SLAs and the expectations of its customers. As Farmer explains. This enables a centralised approach to core IT processes. the club must be able to ensure the ongoing availability of its back-end and front-end IT infrastructure. as well as for core business systems.
in a nearby office building and at various remote sites. In addition to helping the club ensure that it is fully compliant with its software licensing agreements. The Incident & Problem Management solution is integrated with CA Unicenter® Asset Management to provide a comprehensive inventory of the software loaded on each of the club¶s desktops and servers. CA Unicenter Asset Management enables the IT department to identify and remove unauthorised software. which deals with around 500 calls per month. view and control the club¶s 350 desktops and 60 servers. which means we are able to adopt a best-practice approach to helpdesk management.´ comments Farmer. Team Sponsors- Commercial Partners- . These issues are tracked v a CA Incident & Problem ia Management solution. CA Unicenter® Remote Control. which helps to improve efficiency and problem resolution times. Using CA Unicenter Service Desk. the IT department is able to track all incidents from initiation to resolution.31 MANAGING ARSENAL FOOTBALL CLUB Recovery Management Change & Configuration Management Dynamic & Virtual Systems Management At the hub of the club¶s IT operation and EITM approach is its helpdesk. The workload of the helpdesk has also been reduced through the introduction of remote monitoring and management capabilities. Arsenal¶s IT equipment is located throughout the stadium. ³CA¶s solution is ITIL (IT Infrastructure Library) compliant. as well as create automated reports to measure performance and verify that internal SLAs are being met. To prevent the need for travel between sites. CA Unicenter® Service Desk. the club uses a CA Change & Configuration Management solution. This enables the IT team to remotely access. This has helped to not only reduce the number of IT problems but also the number of calls to the club¶s helpdesk.
This solution is vital to ensuring the availability and performance of match day systems. Faults with individual devices can also be identified using SNMP trap information. the IT department can fall back on application log information captured by the solution¶s agents. Previously. Where no SNMP traps are available. the television screens and turnstiles. or the CPU usage is continuously above 90 percent. so that the IT department can prioritize issues more quickly and effectively.32 MANAGING ARSENAL FOOTBALL CLUB Improved fault detection To help reduce the number of problems escalated to the helpdesk as well as the availability of its core systems. ³For example. CA Unicenter NSM creates an alert classified by severity. Arsenal uses a CA Dynamic & Virtual Systems Management solution. CA Unicenter NSM agents have been installed on all the club¶s 60 servers and not only help to identify application problems but also monitor server disk space. a network issue impacting our television screens would be very quickly noticed. CPU and memory utilisation. specifically CA Unicenter® Network and Systems Management (Unicenter NSM).´ comments Farmer. for example. If. the free disk space falls below 10 percent. for example. ³CA Unicenter NSM acts as a central hub for IT availability and performance monitoring and Team Sponsors- Commercial Partners- . which is centrally captured by CA Unicenter NSM from a variety of stadium systems. if a turnstile reader failed between games. this would only be detected during pre-match checks a couple of days before the turnstiles were opened to the public. ³At the new stadium. for example. However. by using CA Unicenter NSM to carry out automated and regular polling of devices. the problem can be identified immediately and fixed well in advance of a match.´ Thanks to CA Unicenter NSM. the club is able to verify that networked devices are still responding. there is a much higher cost associated with downtime both in terms of revenue and reputation.
³By establishing this central hub.´ comments Farmer. SERVICE LEVEL MANAGEMENT Network status views provide valuable and timely service information to staff. In the future.33 MANAGING ARSENAL FOOTBALL CLUB reporting throughout the stadium and club¶s offices. Safeguarding business continuity with replication Although CA¶s solutions help significantly reduce IT downtime. for example email. such as displaying if there are performance issues with a key application. the club is able to use CA XOsoft WANSync to failover to the replicated environment ² with downtime of less than a minute.´ In addition to collating all system alerts from a variety of separate management consoles. it is impossible to foreseeall potential problems. the club plans to fully integrate the CA Unicenter NSM solution wit CA h Unicenter Service Desk to further automate core IT management processes. CA Unicenter NSM also aids in: TREND REPORTING Historical information captured by the solution¶s server agents can be used to identify recurring patterns across the infrastructure. Team Sponsors- Commercial Partners- . such as raising incident tickets. access control system and hospitality servers. The football club uses a CA Recovery Management solution to replicate these systems to offsite servers. which in turn can be used to forecast future capital expenditure. In the event of a hardware failure or other unplanned incident. IT BUDGETING Trend reports can be used to predict when more disk space might be needed. The club must therefore have a robust continuity plan in place for its most critical systems and data ² for example its ticketing servers. CA Unicenter NSM has become our µmanager of managers¶ platform.
the Enterprise Rewinder module enables the club to µrewind¶ to before a corruption event to ensure the integrity of its data. To ensure that the replication process functions correctly. CA XOsoft WANSync¶s Assured Recovery module enables the club to perform regular tests without impacting the production environment ² or even affecting ongoing data replication processes.34 MANAGING ARSENAL FOOTBALL CLUB The mirrored system is also used during planned outages. non-critical systems are backed up to tape using CA ARCServe® Backup. Team Sponsors- Commercial Partners- . during an email application upgrade the club¶s IT department was able to failover to the replica servers and data with no noticeable downtime for users. The solution is managed through a single browser console. the solution is used for µsystem state¶ backups. Additionally. and has been put into practice with Arsenal FC twice since its implementation ² due to hardware failures ² with great success. For example. which means the IT department could rebuild a server from scratch in just a couple of hours. As well as backing up core data. Meanwhile.
As Farmer confirms. our email Team Sponsors- Commercial Partners- . however.35 MANAGING ARSENAL FOOTBALL CLUB Coping with email growth As in any business. As a result. ³Users were treating their mailboxes as an electronic filing system to such an extent that some staff had more than two gigabytes of messages. The importance and popularity of email. email is a key communication tool for the club. means that user mailboxes often become unwieldy.
And we¶re planning to go out and maximise every opportunity we can to continue to drive the business forward. ³With CA Message Manager. the club was keen to reduce the number of emails on the mail server to a manageable level.´ With the backup of the email database and messages taking an average of six hours. which protects against deletion and enables us to enforce our data retention policy. This has resulted in: More proactive and flexible IT services Increased efficiency Reduced system downtime With IT playing such an important role in the club¶s operations. but backups and restores were also taking much longer to perform. ³Thanks to CA¶s technology. This includes a centralised contact centre for all customer queries ² from buying tickets to merchandising queries ² and an innovative plan to provide wireless connectivity and content to portable gaming devices. To keep track of archived emails for its data retention policy and simplify email management. the football club uses CA Message Manager. we now have total control of our email archive and have been able to reduce users¶ mailbox sizes.´ The club is already looking at a number of IT-based opportunities that will help to transform its business. As Ford confirms. ³We store just the previous six months¶ messages on the mail server while long-term copies are held on a separate archive server.36 MANAGING ARSENAL FOOTBALL CLUB storage requirements just kept on growing. Team Sponsors- Commercial Partners- . Arsenal Football Club has been able to simplify and streamline its IT management processes.´ Enhancing the match day experience By implementing CA¶s integrated EITM approach. This not only impacted ongoing management.´ comments Farmer. these improvements have a far-reaching impact on the business as a whole. we¶ve got what we consider to be a Rolls Royce system underpinning allour ITbased customer services.
INCREASE PROFITABILITY By minimizing IT support costs and safeguarding against threats to business continuity. Trying to achieve this with disparate IT management processes and solutions will result in unplanned downtime. Team Sponsors- Commercial Partners- . such as large screens and automated turnstiles. and we can¶t afford to miss a single one.37 MANAGING ARSENAL FOOTBALL CLUB The ability to launch new offerings and guarantee the availability of existing IT-based services helps Arsenal FC: IMPROVE THE MATCH EXPERIENCE FOR FANS By providing sophisticated and reliable facilities. spiraling costs and duplication of effort. ³A club like Arsenal only gets 30 opportunities a year to reach our customers. the club is able to increase spectators¶ enjoyment of the game. the club can continue to attract premium customers ² and the revenue it needs to invest in new players. this means ensuring the availability and performance of a wide range of systems and components. By using IT to provide superior hospitality services. ³CA¶s solutions and integrated IT management approach enables us to safeguard our critical systems and ensure that the match goes on. the club can ensure that it runs a profitable and highly successful business. one negative experience can quickly eclipse a previously faultless track record. With many customer-facing services now underpinned by IT. companies ² even football clubs ² must ensure the customer experience remains as positive as possible. SAFEGUARD COMPETITIVE ADVANTAGE Arsenal FC needs to perform on and off the pitch.´ comments Farmer.´ When it comes to customer service. With consumers facing an ever growing of choice of suppliers.
C Arsenal claim their new position as Britain's richest football club shows they do not need foreign investment. Team Sponsors- Commercial Partners- . "I am unsure what he (Usmanov) can do with 25%.38 MANAGING ARSENAL FOOTBALL CLUB By taking an integrated approach. MANAGING OF FINANCES AT ARSENAL FOOTBALL CLUB STRUCTURE OF FINANCE AT ARSENAL F." The Gunners have been subject to takeover rumours after Alisher Usmanov increased his share in the club to 21% with reports suggesting that he wants to increase his s take to 25%. the club have yet to hold talks with Usmanov. "These results demonstrate we really don't need any outside investment. Latest figures reveal the club's turnover has broken the £200m barrier after the move to the Emirates Stadium. customer satisfaction and profitability. and I do not believe he can stop us operating the business on a day-to-day basis. "We secured all the players we wanted in the summer and manager Arsene Wenger did not spend his budget. while he has met with Arsenal. competitive advantage." said Edelman. an organisation like Arsenal FC will not only be able to meet their IT availability objectives but also improve business agility. American billionaire investor Stan Kroenke has a 12% stake and." managing director Keith Edelman told BBC Radio 5live.
These results are the fruits of opening the new stadium on time and on budget. (Stan) Kroenke has a stake and we get on and run the business every day." He added: "As far as Usmanov is concerned." the statement read. "These results are a testament to the success of the Emirates project. we have always stated our belief as a responsible corporate body. "The club have sown the seeds for a bright new future. we meet anybody who requests a meeting." The move to the new stadium from Highbury means the Premiership leaders are generating more than £3m a game. Red and White. A statement from the Arsenal Supporters' Trust said the group was delighted with the club's current financial position. and that is still our policy.39 MANAGING ARSENAL FOOTBALL CLUB "Usmanov has a stake.9m cash at the year's end and we are telling people today we've got increased cash balances at this juncture. But Edelman told the BBC: "We are looking at a position where we don't believe we need additional monies. Team Sponsors- Commercial Partners- . who claims foreign investment is needed to compete with the likes of Chelsea. but we are trying to focus on the team getting the job done and we do not think it affects them. "We had £73." Uzbek businessman Usmanov's company. "It is a distraction for us to keep talking about it. is chaired by former Arsenal vicechairman David Dein.
"AST reiterates its opposition to any hostile takeover at Arsenal. "It would have to go over 50% for the board not to have a choice. The Arsenal board puts Arsenal first. But Edelman said: "The board can review anybody being a director at any time. based on sensible borrowing to invest in facilities that generate an increased income stream. is a model we commend. just behind Real Madrid. it would say no. "If he had 49. and either accept or decline it. He added that Arsenal project that the "Emirates effect will continue to produce vast sums of money for years". They see themselves as the custodians of the club. Liverpool £80m and Tottenham £127m to match Arsenal. And on Dein's ambitions? "One well-placed Emirates source told me: 'David always sees himself as number one." Team Sponsors- Commercial Partners- . Arsenal's model. The stake held by Red and White Holdings Limited could see them seek a seat on the Arsenal board ." BBC sports editor Mihir Bose says Arsenal can now argue that this brings them into the big league of European earners. "Manchester United will have to put on another £32m from last year to match the GunnersChelsea will have to show an increase of nearly £50m." stated Bose.and a return for Dein." said Bose. but the board did not think he wouldadd value as a director.999%. That is the difference'.40 MANAGING ARSENAL FOOTBALL CLUB "The AST studies carefully the different models of how football clubs are run. He wants to be chairman.
³We have reported significant growth in turnover to £223m reflecting a growth in our core football business. not only on a financial footing but from a footballing perspective.1m to £68. ³We are committed to operating the Club as a business which is financially self -sustaining. and secondly. provides the best possible platform from which to deliver that success for the long-term. we recognise the need to further develop the business commercially on a worldwide basis. as confirmed by the results for the year. The healthy financial returns from Team Sponsors- Commercial Partners- . Accordingly.7m.´ Arsenal moved to Emirates Stadium in order to compete with top European sides.4m. new Premier League domestic and overseas TV deals have led to a rise in broadcasting income of £24. matchday income was £94. There are two main reasons for this.6m and remained the most important component of the Group¶s income. but we cannot be complacent. ³Over the last two seasons Emirates Stadium has taken our football revenues to a new level.41 MANAGING ARSENAL FOOTBALL CLUB SOURCES OF INCOME This Club is ambitious for success and I believe that the strong financial position which the Group has established. Firstly. This is clearly demonstrated having achieved our second highest ever pre-tax profit of £36.
³Given that we have only lost one match in 58 competitive matches since moving here in 2006. The most significant factor is the new TV deal which has increased income by just over £24m. Emirates is certainly becoming the fortress that Highbury once was . In addition. but just as important is the team¶s performances at our new home. the inaugural Emirates Cup which we hosted in 2007 brought in £4m Team Sponsors- Commercial Partners- .42 MANAGING ARSENAL FOOTBALL CLUB moving to the Emirates are the fruits of our labour so far.
However. ³By moving to Emirates Stadium it has enabled us to reduce our season ticket waitinglist. ³We maintain a constant dialogue with Arsène and whilst there is not a set figure in place we are always able to buy additional players should he choose to buy. ³The accounts which we have released today show that the Group had cash balances of some £93 million at 31st May 2008. The difference is that matchday revenue is a direct result of our active fanbase coming to watch the team play. so he decides whether he needs to strengthen his squad. also there is a strong degree of seasonality to our cash flow with season ticket renewals during May having a positive impact on the year.43 MANAGING ARSENAL FOOTBALL CLUB Transfer funds-funds will always be made available to Arsène to improve the quality of the squad and we have consistently stated that adequate funds are available to him if needed. This is clearly a very healthy position from which to support the manager¶s spending plans. it must be recognised that £31.5 million of this cash is held as security for the debt service of our Bonds and its use is therefore restricted. It is part of our overall self-sustainment strategy Team Sponsors- Commercial Partners- .end cash figure Both matchday revenue and broadcast revenue are important revenue streams. We have every confidence in Arsène and trust in his judgment. thus bringing our exciting brand of football to a wider audience as well as increase our matchday revenue significantly.
which are 65 units in the South Stand. the Highbury Square bank loan is ring -fenced from and has no recourse to the football side of the Group¶s business. So in not too long it will look like a few pennies. so it will be repaid entirely from sales proceeds from the development. concessions an corporate d hospitality sales): Hill-Wood has said: Our repayments on the stadium are under £20m a year and it`s producing an extra £50m a year. th will be used firstly in funding the ey remaining balance of the construction costs at the site and then in repayment of the bank loan INCOMES RECEIVED FROM TAKING PART IN VARIOUS COMPETITIONS Matchday Revenue £90.6m: (tickets. ³As proceeds come in on legal completion of sales. Our annual costs are fixed for 25 years. were released at the end of July and our old home already has its first new owner in residence.´ Team Sponsors- Commercial Partners- . They will not rise. Legal completions from this first phase are ongoing and so far have generated sales proceeds of £18. Our income will rise and our gate income will rise. merchandise. Those payments are fixed. ³The first wave of completed apartments.7 million. ³As I mentioned earlier.44 MANAGING ARSENAL FOOTBALL CLUB OTHER SOURCES Arsenal get £6m a year from the Emirates for shirt sponsorship The construction work of Highbury square is right on schedule and a large number of apartments are scheduled to be completed and released for sale in phases over the 2008/09 financial year.
the number of clubs in that association. (The other half of the prize money depends on the value of each club¶s µnational market¶.000 for losing the 4th round and less than £40m for losing the Carling Cup semi-final.3m: o Champions League. the team¶s position in their previous domestic league season and the number of games they played in the Champions League. £1. £450.£1. champions Manchester United earned £9. with last-placed Watford receiving £486.8m for reaching the quarter finals. £300.000 for every groupstage draw.5m each club got as a participation premium. The rest was paid out in µfacility fees¶ and based on the team¶s fi nal standing in the league. as well as £4m for overseas TV deals.000 for every group -stage victory.000 surplus revenue saw each club receive this extra fee in 2006 -07.563. As µmerit¶ payments.000 for every group match played.9m from broadcasting.6m for reaching the knock-out stages and £1. £226.) o Premiership:. o FA Cup and Carling Cup: Arsenal recieved around £40.45 MANAGING ARSENAL FOOTBALL CLUB Broadcasting Revenue £44.Each team was paid an almost £9m share automatically.2m-£7.4m if go further. Potential £2.7m more. £750. Team Sponsors- Commercial Partners- . In 06/07 Arsenal recieved £28.
46 MANAGING ARSENAL FOOTBALL CLUB MAJOR EXPENSES PLAYERS AND MANGERS SALARIES Team Sponsors- Commercial Partners- .
o Team Sponsors- Commercial Partners- . but most people will get roughly the same bonus if they perform in line with expectations. so pay can be fine-tuned to mirror performance. At the year end there will be some variation in rewards. but these account for a small fraction of the remuneration package. the financial position of the business and the performance of the rest of your team. A football player (or his agent) is no more likely to accept his income should depend entirely on the vagaries of the team's performance than you or I would accept that our entire income should be at the mercy of the success of our companies and the efforts of those ar und us. Players do have performance bonuses written into their contract. There is a market out there. That bonus element will depend on a performance rating in your annual appraisal. and more than most markets the skills of the players are observable to employers. and will almost inevitably include a fixed basic salary and a bonus element. Expensive teams win you games.47 MANAGING ARSENAL FOOTBALL CLUB HOW ARE SALARY PACKAGES OFFERED The package you are offered will be tailored to you. My own research has shown that the market for football players works so well that in the long term the variation in what teams are prepared to pay for talent accounts for around 90% of the variation in team success. This is more or less what is going on between footballers and clubs they work for.
But the direct incentives are small. England players are paid by the FA. Clubs try to buy the best team they can afford (and sometimes cannot quite afford) so that the wage of a player is determined in relation to all the other players in the market. Players do have a financial incentive to perform because the marketing opportunities created by having a good World Cup can make you very rich. where your own efforts almost entirely determine entirely how you perform and there is no team element. the relationship between pay Team Sponsors- Commercial Partners- . Sometimes clubs make mistakes. FIFA keeps most of the money. but there is a long -standing agreement that this remuneration is donated to charity. Players mostly want to play for their country ² out of patriotism and out of self interest. who are highly dependent on what the team-mates around them are doing. Fair enough for Roger Federer or Tiger Woods. In US sports such as baseball and American football where clubs agree to share income and restrict competition for players through salary caps and the like. but not for Wayne Rooney or Jonny Wilkinson. and the amounts distributed by national associations to players are tiny relative to the club salary of a Premier League star.48 MANAGING ARSENAL FOOTBALL CLUB In a very few businesses. Performance-related pay for teams is more likely to lead to internal squabbles than squad unity. Players are paid a wage that is high enough to stop them leaving to play for someone else. Does anyone seriously think England would have performed better if they had kept the money for themselves? Anyone who saw John Terry's maniacal (but comic) attempt to clear a late Slovenian shot with his head cannot doubt the commitment of the players. Which brings us back to the question of why players are paid so much when pay does not directly influence performance. incentive-related pay dominates ² but usually these are jobs like sales. the question of incentives becomes more complicated. but there are so many players and so many clubs that these errors are quickly ironed out. When it comes to the World Cup.
On 31 May 2007 the club's net debt stood at £262. and work ceased just after it had begun. especially as Arsenal were not granted any public subsidy. However at the same time there are multiple sources of income for the club. you get pretty much what you pay for.49 MANAGING ARSENAL FOOTBALL CLUB and performance is much weaker. It was the first publicly marketed. augmented by the extra costs the club had to meet besides building the stadium itself. As long as the clubs have the money to spend. led by the Royal Bank of Scotland In August 2005 Arsenal announced plans to replace most of the bank debt withbonds.14% and 5. asset-backed bond issue by a European football club.5 year bonds with a spread of 52 basis points over UK government bonds and £50 million of 7. The club issued £210 million worth of 13. But in Europe. and they are due tobe paid back over a 25 year period. the move to bonds has reduced the club's annual debt service cost to approximately £20 million a year. The proposed bond issue went ahead on 13 July 2006. the remainder of the Lough Road site is being used for new housing. Arsenal had difficulty obtaining finance for the project. REPAYMENT OF LOAN TAKEN FOR THE CONSTRUCTION OF THE EMIRATES The £470 million cost of the project. as are the surplus areas around the stadium at Ashburton Grove.1 year bonds with a spread of 22 basis points over LIBOR.97% respectively.1 million. was a formidable obstacle. The effective interest rate on these bonds is 5. Team Sponsors- Commercial Partners- . player salaries will remain astronomical. before restarting when a £260m loan package was obtained from a consortium of banks. where the free market rules.
Final accounts for the year ending May 2007. there is the increased revenue from the stadium itself. show that Arsenal's turnover has increased to £200. (in 2006±07 the club recorded a surplus of £37 million). Finally.2m the previous year and that group operating profits increased to £51. over the course of the deal and a £15m contribution towards the capital costs of the stadium's catering facilities from catering firm Delaware North. Arsenal's then chief executive Keith Edelman commented that the new stadium is expected to increase Arsenal's turnover from typically £115 million to around £170 million .2m. which has a 20-year exclusive contract to run the stadium's catering operation.8m. and the club is counting on the profit from these developments to make a major contribution towards the costs of the new stadium. most of which have been sold. Team Sponsors- Commercial Partners- . In total.50 MANAGING ARSENAL FOOTBALL CLUB Highbury is currently being converted into apartments.000 homes will be built at the three sites. Arsenal's first season at the Emirates. the club's turnover has increased by at least £20m a year. compared to £137. Other sources of revenue include the £100m from Emirates for the naming rig to be paid hts. Even once debt repayments are taken into account. In 2005. more than 2.
51 MANAGING ARSENAL FOOTBALL CLUB A FINAL SUM UP OF ARSENAL¶S FINANCES FOR THE LAST YEAR AS COMPARED TO OTHER TOP CLUBS From the above statistics it is crystal clear that Arsenal as compared to other clubs recorded the highest Net Profit Before Tax thereby highlighting how successfully it manages its finances Team Sponsors- Commercial Partners- .
but this was because they paid more attention towards paying off their rather than buying elaborate stars for the team and paying high wages to them. excellent management and financial success in terms of profits every year)´ ANS-Thus after compiling the results and findings in respect of this hypothesis I have reached a conclusion that this hypothesis is correct as from the above data (informative and statistical) although Arsenal may not have been successfully by way of winning competitions but its financial position is much more solid and concrete compared to clubs other top clubs competing at its level. Although Arsenal F. Arsenal has thrived under his reign and the team has gained immense success even on the global stage.52 MANAGING ARSENAL FOOTBALL CLUB TESTING OF HYPOTHESIS The hypothesis for this project was ± ³Success on the pitch (by way of winning trophies and competitions) for a club doesn¶t always guarantee the Success off-the pitch (in terms of financial solvency. Arsenal¶s success also goes down to its manager¶ Arsene Wenger who unlike others believ es in spending wisely.C isn¶t that popular in these parts of the world yet slowly but surely it is getting recognised as one of the be examples of Club st management and people around the globe are recognisingits style of play on the pitch and style of management off the pitch. bu are now suffering to recover these amounts in these t recessionary conditions. CONCLUSION Thus i would like to conclude this project report by saying that although Arsenal have been unsuccessful in terms of winning a major trophy since the past 4 years. Clubs which have been successful have signed such stars on extraordinary pay packages. Team Sponsors- Commercial Partners- .
com Team Sponsors- Commercial Partners- . c o.blogspot.deloitte.htm http://jeffrims.com h t t p : / / UEFA.com http://CNN.com/view/en_US/us/index.uk http://Arsenal.co.com/2008/05/latest-transfer-arsenal-newss.53 MANAGING ARSENAL FOOTBALL CLUB BIBLIOGRAPHY http://www.uk http://guardian.com http://GiveMeFootball.goonernews.html http://www. uk/ f oot ba ll http://mirror.com http://Scotsman.co.com/ ht t p:/ / t hesu n.
2 million) and boosted the operating profit from property activities to £7. 2009: Group turnover increased to £313.0 million of revenue (2008 . The completion of sale of 208 (2007 ± Nil) private apartments at Highbury Square contributed £88.7 million (2008 .£94. Match day revenue was increased to £100. Since the end of the financial year there have been a number of further positive developments in relation to the Group¶s Highbury Square project: Of the 655 private apartments in the development.0 million) reflecting income generated from cup competitions and property sales.7 million) was a record for the Group. Team Sponsors- Commercial Partners- .6 million).3 million (2008 .£15.£25.54 MANAGING ARSENAL FOOTBALL CLUB ANNEXURES ARSENAL HOLDINGS PLC: FINANCIAL RESULTS Results for the year ended May 31. Profit after tax of £35.1 million (2008.£223.8 million (2008 ± Nil). mainly as a result of progress to the UEFA Champions League and FA Cup semi-finals. sales have now complet d on 445 units e with a cumulative sales revenue value of £172. Operating profits (before depreciation and player trading) in the football business were £62.4 million.6 million).2 million (2008 .£59.
both on and off the field. which in turn allows us to maximise the level of investment in the playing staff and in the future development of the Club. Legislation in the United Kingdom governing the preparation and dissemination of financial information differs from legislation in other jurisdictions. Commenting on the results for the year.´ Ivan Gazidis. The Club is superbly positioned for the future and I am tremendously excited about the opportunities we have ahead of us. Source: Arsenal. the Club already has a first class stadium. Chief Executive.com/newsarchives Team Sponsors- Commercial Partners- . as such. non-executive Chairman. our main goal will always be the achievement of success for Arsenal on the field. This is excellent news although I should perhaps stress that making and reporting profits is not in itself the primary objective for the directors. Peter Hill-Wood. Football is a hugely competitive and fast moving business and we must ensure that Arsenal is not just keeping pace but setting the pace. said: ³Clearly. First and foremost we are supporters of this great football club and. said: ³The Group¶s profits have now risen in each of the three years in which Emirates Stadium has been our home. The Group¶s profitability is important because it is a by-product of running the Club as a solvent and successful business.55 MANAGING ARSENAL FOOTBALL CLUB The balance on the bank loan used to fund the project has been substantially reduced to £47 million and agreement has been reached to refinance the loan and extend its term to December 2010.´ The directors are responsible for the maintenance and integrity of the corporate and financial information included on the company's website. an excellent world -wide reputation and outstanding core support.
The development is being executed in phases and our contractors. 136 apartments in total. have now been handed over to us by Sir Robert McAlpine and we Team Sponsors- Commercial Partners- . The summer of 2009 is when Highbury Square will be fully complete but as with any major development of this scale. The first and second phases of finished units. Very well. How is the redevelopment at Highbury Square progressing? A. the stunning Highbury Square r e-development is certainly taking shape. like the old Highbury. Sir Robert McAlpine. The matchday programme caught up with Acting Managing Director Ken Friar OBE for the latest on the development. You can envisage the pitch and the stands and it brings back such fond memories. and as you can see from the pictures. A real sense of history remains there. we have phased handovers of finished units from now through to the end of the construction works. Q. Q. Due for completion next year. What I find amazing is even though the old stadium is transforming into apartments at a rapid pace n it still feels ow. many of the traditional elements of the building have been preserved. are on time or ahead of schedule with each of the phases. Arsenal's previous home Highbury continues to undergo its transformation from football stadium to luxury apartments. When is the development due for completion? A.56 MANAGING ARSENAL FOOTBALL CLUB HIGHBURY SQAURE REDEVELOPMENT: Highbury Square development ± Latest Just a few hundred yards from Emirates Stadium.
some residents have already moved in to their apartments in the South Stand. There are a total of 680 apartments in the development of which 655 apartments have been marketed so far. the site of the old Clock End. Q. A completed apartment Q. That sounds promising. In that sense it will be a bonus.As mentioned. profits could be used to reduce the stadium debt or to strengthen the team if the manager wishes. a figure that we are obviously extremely pleased with. Team Sponsors- Commercial Partners- . 598 have already been presold. How does the Board envisage using the profit made from the sale of Highbury Square? A. In fact. As such we have not budgeted for the profit and this allows the Board to be flexible over its use as the money has not been earmarked for anything in particular. for example. which represents over 90 per cent of the development.57 MANAGING ARSENAL FOOTBALL CLUB already have over 90 purchasers completed. We have options available to us. over 90 purchasers have completed so far. generating some £39 million of sales income. The financials for the Highbury Square development have been ring -fenced so they are separate from our usual football business. How many apartments have been sold? A. Of these.
However. The development also captures the history and character of Highbury Stadium with the East and West Stand facades retained and the pit h c constructed into a private two-acre garden for residents which. How will you feel once the development is complete? Team Sponsors- Commercial Partners- . we have enlisted the support of Savills Private Finance to assist purchasers in achieving finance where they require it. due to personal circumstances. by virtue of location and character. To date. this is completely untrue. we believe that we continue to outperform the market and indeed a recent independent valuation by Colleys concluded that all of the Highbury Square apartments have exceeded the prices contracted to be paid for them. had to pull out and bo of these were over six months ago. is the largest private London Square to have been built this century. why do you think that is the case? A. Q. Absolutely not. There are only 57 units which are unsold and these are a mix of one and two bedroom apartments. in terms of connections in and out of central London. which is in an excellent location. Property that has unique qualities. There has been some suggestion that a significant number of purchasers have pulled out of the development.What type of properties are still for sale? A. we believe.58 MANAGING ARSENAL FOOTBALL CLUB Q. As th it stands. Highbury and Islington as a whole is a highly desirable location for purchasers and tenants al ke. so we believe the i future prospects for Highbury Square are very positive. In addition. we are not complacent or shortsighted about the current economic climate and with this in mind. always maintains its value relative to the market and is always the first to realise an increase in value.What are the long-term prospects for the Highbury Square development? A. This is definitely the case with Highbury Square. Is this true and if so. Q. Q. we have had just two purchasers who.
When the club .com. and three bedroom apartments priced between £250. "The fear a good number of the prospective purchasers who had put 10% down on Team Sponsors- Commercial Partners- . both on and off the playing field. BBC News Arsenal goes into the new English Premier League season looking forward to a timely financial boost from the sale of apartments at its former stadium. it will close an eventful chapter of my life. And at the end of the month those who have paid a deposit . But there are fears that the credit crunch and falling property prices could now hit Arsenal's financial plans. it turned its old home over to housing development. ARSENAL BUILDS FINANCIAL FOUNDATIONS By Bill Wilson Business reporter.000 and £1. To live in a home in the µhome of football¶ gives it added sparkle but for me personally. two. It is hoped the sale of apartments can boost team building 'Far from rosy' The £300m-plus development should be providing some funds for manager Arsene Wenger.000.on apartments in the South Stand of the scheme will have to pay the rest of what they owe.of between 10% and 20% .moved from Highbury to its impressive new Emirates Stadium in 2006.thestadium-highbury. who has had to operate frugally as the club also services the debt it took on board to build its modernistic new venue at Ashburton Grove.59 MANAGING ARSENAL FOOTBALL CLUB A. It will offer a tremendously unique place to live for all those who have bought an apartment there and in that sense it will be truly exciting.500.which describes its business as both "football and property" . The Highbury Square development comprises 711 one. Football business guru Alex Fynn is the latest commentator who feels the club may be regretting the decision to rely strongly for future income streams through the property market. Source www.
. adds: "The board know they are treading financial water until the Highbury Square revenue starts coming in. it plans to sell affordable housing to a housing association and to market other accommodation to a residential property company. As Mr Fynn points out: "The club has massive commercial developments. Commercial developments But the club. the former Highbury submitted a planning application for the playing area is being transformed redevelopment and regeneration of Queensland Road as part of the Emirates Stadium regeneration programme. However it is believed the Arsenal board is sanguine about the curr economic situation. ent and envisages no problems with the development. Arsenal: The Making Of A Modern Superclub .. There. which analyses the club's journey from financial underachievers to third richest club in the world.." As it was. and in fact they now define the nature of their business as being 'football and property'." he says. who has written and spoken extensively on the business of sport. "The only danger is they might have predicated a few decisions on the premise that Highbury Square was going to bring in more revenue than it might realise.60 MANAGING ARSENAL FOOTBALL CLUB Highbury Square apartments might cut and run in the light of plummeting property prices means Arsenal's garden is suddenly far from rosy.7m on its property development in the sixmonths to Team Sponsors- Commercial Partners- ." As well as Highbury Square. Mr Fynn. It is also understood the club believes that even in a falling property market. despite current housing market uncertainty.. the uniqueness of the Highbury Square development will help the flats hold their value. Arsenal has also recently As it is. which had made the decision it would make more money by redeveloping the stadium itself rather than selling out to a developer. The point is made in a book Mr Fynn has co-written. highlights the fact it has sold more than 93% of its apartments. fans arriving for a He also expresses concern in the book that "for the game at Highbury in 1972 club to develop Highbury Square themselves might not have made sound economic sense in the light of the credit crunch that came along". Wage control The club had turnover of £23. It is known that three buyers so far have given up their deposits and walked away from completing their purchase at Highbury Square.
handling a number of big -name clients including several football clubs. that they enjoy a successful run in the Champions League." Match-day revenues However he also warns that there are a "few variables" that could influence their financia l position.61 MANAGING ARSENAL FOOTBALL CLUB November 2006 and in November 2007 this was £7. ensuring that Arsene Wenger is retained as manager and the lack of commercial experience which the club has at the highest level.152 attended matches at Arsenal's new home during the 2006/07 season.as Arsenal has done . "These are that they play to sell-out grounds in the English Premier League. Highbury "If they continue to do that. As it will be.266 took their seats. a 76% increase the Highbury Emirates on the total attendance during the final season at Alex Fynn Highbury.which triples your matchday income at one fell swoop. However it is understood this is merely down to the fact that more payments -due dates fell in the earlier financial period..044. In a £90m. "not withstanding the fact they have got a huge debt . there is a very great transformed into apartments difference in going in to debt and trying to buy success through the purchase of players.5m in 2007. "All I would say is that maybe from a marketing point of view they could have ma de better use of the assets they have. 15-year. who has worked as a director at Saatchi & Saatchi advertising for nearly 20 years. Team Sponsors- Commercial Partners- . and going into debt to build a new stadium. These include the future shape of the property market and credit crunch.which is manageable as long as they fulfil three criteria. deal Arsenal gave the airline Emirates exclusive naming rights to the stadium. In moving from Highbury to the Emirates Stadium They could have been protected the brand..838. And operating profit from property fell from £9. "I would say Arsenal's finances are very good." says Mr Fynn.6m." says Mr Fynn. and that they keep their wage to turnover ration at a healthy level under 60%. the stadium something like A total of 1. 'Protecting the brand' The move also saw the groundbreaking naming rights sale at the new stadium.3m in 2006 to £2. by calling Arsenal hugely increased their match-day revenues. when 1.
nobody with experience of working at somewhere like Procter & Gamble for example. by calling the stadium something like the Highbury Emirates.co. Ian Wright and Thierry Henry once played will overcome any housing market wobbles. In the meantime Arsenal are betting that the lure of owning an apartment overlooking where greats such as Alex James. Mr Fynn believes Arsenal could "But let us not forget it is the third richest football have handled its naming rights club in the world. 10 August 2008 15:40 UK http://news. "I have suggested in the book that there were different ways of handling the stadium naming rights. Sunday. Charlie George.stm Team Sponsors- Commercial Partners- .62 MANAGING ARSENAL FOOTBALL CLUB "There is nobody on the board with a marketing or advertising background. They could have been protected the brand." Meanwhile the club hopes the conversion of all four former stands into apartments will be completed by the end of summer 2009. Page last updated at 14:40 GMT.bbc.uk/2/hi/business/7545274.