Borussia Monchengladbach sporting director Max Eberl believes the club can't compete with Arsenal for Montpellier striker Olivier Giroud.
The French international has been heavily linked with a move to the Premier League, having scored 22 goals in Ligue 1 last season.
While Eberl admits Monchengladbach are negotiating with Giroud, he says with Arsenal also in contention, the club are consigned to losing out.
"We remain true to our policy that we do not throw our money out the window. The problem in our negotiations is that we are in competition with clubs like Arsenal and top clubs in Germany," he said.
Gladbach feel they have a strong bargaining position, having qualified for the Champions League, however Arsenal, who finished third in the Premier League last season, will also play in Europe's premier club competition next term.
Having already brought in Lukas Podolski from FC Cologne, The Gunners have shown impressive intent in the summer transfer window thus far, while rumours persist over Yann M'Vila's proposed move to north London.
The club lost Cesc Fabregas, Samir Nasri and Gael Clichy late on in the summer window 12 months ago, and without a contingency plan, manager Arsene Wenger was forced to panic buy to help replace his sold stars.
Park Chu-Young, Yossi Benayoun, Mikel Arteta, Per Mertesacker and Andre Santos all joined the club during the back-end of the window, and Arsenal's scattergun approach during the back-end of the window saw them stumble at the start of the season.
As well as bringing in new faces ahead of next season, Arsenal's main aim this summer with be to retain Robin van Persie, with the skipper's contract set to expire next summer.
Currently playing at Euro 2012 with the Netherlands, Van Persie is expected to conclude negotiations with the club after the summer's European Championship.
While many will identify the addition of Giroud as a possible replacement for Van Persie, supporters will be hoping the France forward can be paired with the 30-goal forward at The Emirates Stadium for next season.