January transfer spending reaches record level

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Spending by Premiership clubs of around GBP 70 million is greater than in any of the previous three January transfer windows according to analysis by the business advisory firm Deloitte.

Dan Jones, Partner in the Sports Business Group at Deloitte, commented: “English clubs have again demonstrated their ability to invest in players. Despite the lack of recent transfer activity by FC Chelsea, player spending of GBP 70 million is a record for a January transfer window. Overall, the Premiership clubs have spent around GBP 300 million in 2005/06, moderately up on spending of around GBP 270 millions in each of 2003/04 and 2004/05.”

Some of the key findings from the analysis by Deloitte include:
The aggregate reported spending by Premiership clubs for the Summer 2005 and January 2006 transfer windows of around GBP 300 million was moderately higher than in each of the previous couple of years (2004/05: GBP 265m; 2003/04: GBP 265m).

Many overseas clubs benefit from player transfer spending by English clubs, with around GBP 150 million being redistributed overseas in 2005/06 (including almost GBP 40m in the January 2006 transfer window). Over half of player transfer spending by Premiership clubs in 2005/06 has gone to non-English clubs (2004/05: 63 percent; 2003/04: 50 percent).

In financial terms, there has been good news for clubs below the top tier in England, with over GBP 50 millions of Premiership spending going to Football League clubs in 2005/06. Whilst Southampton and Norwich City have particularly benefited financially from player sales following relegation last year, in total over a dozen Championship clubs have each benefited by at least GBP 1 million.

The ‘top spenders’ in January 2006 have been Manchester United, Arsenal and Portsmouth, helping to increase the overall reported spend to around GBP 70 million (up on the figure of around GBP 50m in each of the January 2005 and January 2004 transfer windows, and GBP 35m in January 2003).

The Deloitte Football Money League report (former “Richest List”) published recently also affirms the position of several Premiership clubs amongst the ‘Top 20’ highest revenue generators in the world. Looking ahead to the summer 2006 transfer window, Dan Jones said: “Whilst we still think that the Premiership holds the strongest hand in the transfer market and despite it being a World Cup year, we expect that the level of transfer spending by Premiership clubs will be lower in summer 2006 than in 2005.”