Chelsea are best and worst at player trading

Player sales are often viewed as an easy solution for clubs striving to comply with Profitability and Sustainability Regulations (PSR), and there’s some truth in that, but people should really look at player trading as a whole to fully understand the overall impact on a club’s finances.

In terms of profit from player sales, there is a clear winner in England, as Chelsea have made a very impressive £417m, which is £80m clear of the next highest club, Manchester City £337m, followed by Leicester City £249m, Brighton £195m and Everton £189m.

The third highest member of the Big Six is Liverpool, who are in 6th place with £173m, while the others are all a fair bit lower: Arsenal £117m, Manchester United £94m and Tottenham £80m.

It’s still relatively rare for clubs to book impairment, not least because it can be an indication of poor recruitment, but there have been some fairly high charges in recent years, partly driven by the impact of the COVID pandemic on the transfer market.

Again, the leader here (by some distance) is Chelsea, who have booked £95m impairment in the last five years, including £77m in 2022/23 alone. The next highest is Everton with £49m, then there is another large gap to Arsenal £26m and Leeds United £23m.

Only four clubs in the Swiss Ramble’s review end up with a positive balance, while many of them have enormous negatives.  The four profitable clubs are Bristol City £34m, Swansea City £25m, Brentford £21m and Watford £12m.

Championship clubs tend to do better at player trading overall, even if they don’t make so much from player sales, because of much lower player amortisation than the leading clubs. This is pretty much out of necessity, as they lose a lot of money at the operating level.  In contrast Premier League clubs don’t have to focus so much on player trading, thanks to the very lucrative broadcasting deal in the top flight. In fact, many clubs will actively try to retain their top talent, rather than cashing in via transfers, to give themselves the best chance of survival.

The clubs with the highest negative balances for player trading are actually the Big Six, again because they generate the most recurring revenue, so they don0t have to. Over the last five years, these losses are enormous, e.g. Manchester United £594m, Chelsea £498m and Arsenal £474m.  In other words, Chelsea are the best in England at player trading when looking only at player sales, but the second worst when the full picture is considered.

The best performing club in the Premier League is Brentford, even though their player sales have fallen significantly after promotion from the Championship.  Of the clubs that have been in the Premier League for all five of the seasons under review, Brighton are the best performers, sitting in 7th place with a negative balance of just £26m.

Selling academy players has played a key role in Chelsea’s player trading strategy, earning them more than a quarter of a billion pounds since 2021/22 with seven players sold for £20m or more in that period.

Increasingly, this is a strategy followed by other clubs, especially Manchester City, who have made nearly £200m from the sale of academy players in the last three years, led by Cole Palmer’s transfer. As an aside, they seem to have found a handy customer in Southampton, who have paid City £76m for no fewer than six of their youth products.

Even though Chelsea are the best at player trading when looking at profit from player sales, they are the worst when we take into consideration all aspects of player trading.

That said, profit from player sales is far more important for Chelsea than other members of the Big Six, as it was equivalent to 18% of their recurring revenue in the last five years, whereas the next highest was Manchester City with 12%. In stark contrast, it was only worth 3% of revenue at Manchester United.

As might be expected, player sales are much more important for Championship clubs, even though the absolute amounts generated tend to be lower than their Premier League counterparts, e.g. Bristol City’s £81m player sales was worth 58% of their £140m revenue.