Despite having owners willing to spend big, Villa and Newcastle have been held back by PSR due to a lack of global profile and revenue earned off the pitch.
Both clubs have complained loudly about having their wings clipped and Plumley told Tribalfootball.com: "Yeah, I've a little bit (of sympathy). I think, and of course, we're moving the Premier League now to squad cost ratio, but the same applies.
"I've just looked at the revenue list this morning and Newcastle, nearly €400 million. Villa, €450 million. But Liverpool, €836 million. Manchester City, just just over 800 million. You know, that's the challenge. And in a world of squad cost ratio now, where revenue is a big driver in how that ratio works, you can see the challenge for some of these clubs.
"And we've talked a lot about Villa and Newcastle recently as two clubs that are trying to break into that elite group and are finding it a challenge. And Villa have been fined by UEFA and, you know, Newcastle have talked openly about PSR. So, yeah, it's a challenge.
"And look, these clubs have got to find a way to do that. And I think you can see growing revenue will be key to that commercially. Stadium expansion projects, new stadiums, things like that. All the clubs are trying to do it now because revenue generation is such a huge factor.
"But the biggest clubs in the world are far ahead of the rest still. So there's still a big gap to make up."
For him, Plumley says the Premier League's decision-makers need to re-examine PSR, branding it as potentially "anti-competitive".
He added, "I think squad cost ratio is is a progression on PSR. I think it's a better version of what we had but it won't change the dynamics too much because it's ultimately if you generate more revenue, then you can spend more on on your squad so we're still in the same position.
"I think it's a step in the right direction but I think with any regulatory framework look - and I'm not suggesting that we should take the handbrake off fully and go back to a world of no regulation because we're not in that space anymore - but we have to remember that regulation will always be anti-competitive to some and that's the reality."
- Dan Plumley was speaking to Tribalfootball on behalf of Covers.com World Cup betting