We need a top class CB to replace Mertesacker in the squad, because numbers wise we are good now. Smalling isn't that guy, and I frankly don't see a need for him at all.
With proper management of a squad a manager should be able to keep 4 CBs happy, especially if one of them is a young player who won't make too many demands. IMO Chambers is a perfect fit for that role. Hopefully, Gabriel turns out to be a big hit, fast. Mertesacker is an excellent 3rd choice for at least another season, but if the opportunity arises to get a top class CB like Hummels in, then Mertesacker is the one I'd sell right away.