Arsenal chief executive Ivan Gazidis says the club cannot compete with their Premier League rivals over transfer fees because they "can't afford to make huge mistakes".
The Gunners had a £29.3m offer for striker Alexander Lacazette rejected by Lyon earlier in the summer, while Gonzalo Higuain, with whom they have been linked for several transfer windows, moved from Napoli to Juventus for £75.3m last week.
Arsenal have bought three new players this summer - midfielder Granit Xhaka, forward Tasumo Asano and centre-back Rob Holding - but have been criticised for their lack of transfer activity, specifically in adding attacking options to their forward line.
Gazidis has defended the club's purchasing policy, and says the club will continue to be prudent as they plan for the future.
"We can't afford to outgun competitors that have far more money. We have to be very careful, very selective," he said.
"We would not be successful if we simply went out into the transfer market and tried to outgun our competitors.
"We're run in a self-sustaining way, and a way that we believe in, because we believe it gives us certainty for the future and enables us to plan our future with confidence.
"That means we can't afford to make huge mistakes in the transfer market. We can't afford to outgun competitors that have far more money to splurge on transfer fees than we do. So we have to be very careful, very selective about how we do things."
Alongside such a prudent policy, Gazidis also outlined plans to continue investing heavily in the club's youth system, a strategy which he is confident will be productive for many years to come.
"We're still active in the market, as are most other clubs, and if we find opportunities that our manager believes can improve our squad and add something to it, we're certainly going to take those steps," he said. "But in terms of this week, I don't think there will be any radical surprises.
"This year we're investing over £20m in developing our facilities - our training ground for young players and our academy and the main training ground.
"Those are investments that are being made for the long-term future of the football club, for the next 10, 15, 20 years.
"And we're making those decisions in exactly the same way, and Arsene Wenger is actively involved in them, even though he probably won't see the fruits of all of those investments."