Insider issues one-word update about Chelsea's search for shirt deal as £60m PSR blackhole widens
When Todd Boehly, Clearlake Capital and the other co-investors that bought Chelsea for £2.5bn arrived in West London in May 2022, there were promises of a quantum leap forward as a business.
No sooner were the owners through the door and Chelsea were briefing journalists that Boehly, then very much the main man at Stamford Bridge, was unhappy with the commercial setup he had inherited.
Boehly’s background in US sport as owner of NBA and MLB franchises in particular inspired hopes that he could oversee a groundswell in sponsorship income and merchandise sales.
So far, that has not materialised – or, at least, not in the annual financial accounts that are currently available for public consumption in Companies House.
Commercial income was £209m in the last year of the Roman Abramovich era and remained almost completely static at £210m in the first year of Boehly-Clearlake’s reign.
We don’t have Chelsea’s books for 2023-24 yet (they will be released somewhere around March next year), but the signs don’t point to a major uplift from partnerships or merchandise.
A mediocre season on the pitch was not fertile ground to grow merchandise revenue, although Enzo Fernandez’ first full season did boost shirt sales.
There was a new front-of-shirt deal in Infinite Athlete, who the Premier League deemed an ‘associated party’ under their commercial rules, suggesting some link to the owners.
But even that deal at £40m-a-year fell short of the benchmark among Chelsea’s peers due to it being inked with two months of the 2023-24 season having passed.
For an enterprise like Chelsea, that is unforgivable. Especially when £60m-a-year benefactors Nike believe the lack of a front-of-shirt deal has hindered the Blues’ shirt sales.
But lo and behold, the same thing has happened again.
It is now November and Chelsea are the only Premier League side without a front-of-shirt deal.
That matters. Why? Because the Premier League are desperate to prove they can self-govern with the threat of a government-backed independent football regulator looming.
They will take no prisoners when it comes to PSR (Profit and Sustainability Rules).
Chelsea’s PSR margins are razor thin, even with the PSR-boosting intra-company deals engineered by BlueCo (such as the sale of two hotels at Stamford Bridge and the women’s team) taken into account.
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Chelsea’s progress with a front-of-shirt deal
Łukasz Bączek is a sponsorship expert and regularly breaks some of the biggest stories in football’s commercial sphere via X.
He recently reported that Chelsea had been in talks with Riyadh Air regarding a front-of-shirt deal.
But the Saudi airline’s stadium naming rights deal with Atletico Madrid means that is now highly unlikely, he says.
Two more airlines – Qatar Airways and Turkish Airlines – have also been linked.
However, it looks like there has been little progress.
Asked by a follower if there was any update, Bączek responded prosaically: “Nothing.”
That is onerous for Chelsea’s hopes of securing a high-value deal, with the price a potential sponsor is willing to pay dwindling with every match Enzo Maresca’s side play.
Why have Chelsea not got a shirt sponsor yet?
While there can be no excuses, there are a few possible explanations as to why Chelsea are yet to strike a front-of-shirt deal.
First of all, Chelsea’s commercial department may simply have their sights set too high.
£60m per year is the figure they are reportedly targeting, which some analysts have suggested might be a little too ambitious, albeit not wildly so.
The Premier League’s biggest shirt sponsor deals
- Tottenham – AIA, £40m per season
- Arsenal – Emirates, £50m per season
- Liverpool – Standard Chartered, £50m per season
- Man City – Etihad, £67.5m per season (includes stadium naming rights)
- Man United – Snapdragon, £60m per season
Perhaps the continued absence of a chief commercial officer might also be something of a breadcrumb trail.
Chelsea poached Tottenham’s CCO Todd Kline from Tottenham back in February but he is yet to start work and is still officially on gardening leave from his role in North London.
Incidentally, Spurs are yet to announce their new CCO, although it looks as though there is one in situ given that they were listed as an attendee at a recent high-profile sports business conference in London.
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The APT case and its impact on Chelsea
Another potential reason might be the ongoing turbulence behind the scenes at Premier League HQ relating specifically to commercial partnerships.
Man City challenged the Premier League’s associated party transaction (APT) rules at an independent tribunal and although these cases are never win-lose affairs, they did win some key points.
That means the Premier League is now scrambling to find a resolution, with the support of two-thirds of its member clubs needed to pass any motion at a shareholder meeting.
Chelsea gave evidence in support of Man City at the tribunal. Could it be that they are waiting for the opportune moment, perhaps in a slightly more relaxed APT environment, to strike?
Possibly. Instinctively, however, that would seem misguided.
It is unlikely that Man City will be able to have the APT rules pronounced null and void entirely, as they are currently attempting to argue.
Any extra value that Chelsea might be able to squeeze out of an APT deal therefore would probably be negligible, and certainly not enough to justify waiting months
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