Yup
Nike Sources part II
- Thread starter JurgenKlopp
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Yup
There's one thing I don't understand and maybe someone can explain this to me.
The Nike deal is reported as 30m plus 20% of net sales.
In contrast, Adidas pays Arsenal 60m and, presumably, keeps all the sales.
I suppose Nike has similar deals.
Why would Nike be motivated to promote the Liverpool brand when it earns less on each shirt than on other club shirts? If I was Nike I would be pushing the shirt on which i spent 60m and earn 100% profit
The Nike deal is reported as 30m plus 20% of net sales.
In contrast, Adidas pays Arsenal 60m and, presumably, keeps all the sales.
I suppose Nike has similar deals.
Why would Nike be motivated to promote the Liverpool brand when it earns less on each shirt than on other club shirts? If I was Nike I would be pushing the shirt on which i spent 60m and earn 100% profit
It's probably because one of those teams European champions.
If Liverpool really do have the potential to be one of the very best selling kits in the world then you're going to want to get as much of that potential as possible. That can be 80% of a much bigger amount if they throw everything at it in terms of promotion and distribution.
So... We are like a player who agrees to be paid as long as he is scoring and in the manager's plans....
Or
That club that loans a player to AC Milan, for free, with a condition that they'll buy him if they win the scudetto?
Imagine being the best performer in your company for 2019, then your boss comes over and offers you NO pay rise "but do it again in 2020 and 2021, son, and you'll be rewarded handsomely"
Or
That club that loans a player to AC Milan, for free, with a condition that they'll buy him if they win the scudetto?
Imagine being the best performer in your company for 2019, then your boss comes over and offers you NO pay rise "but do it again in 2020 and 2021, son, and you'll be rewarded handsomely"
@Hyena I don't really understand your analogies. The one thing I think these FSG guys know is business and profit share. If we're going down this road it is because we think there is a much bigger profit to be made. We know we could have just asked for a guaranteed sum in excess of anything asked for by pretty much anyone else. But we didn't. As for Nike, they have the prospect of having 80% of a great big bag of cash, so they will want that bag to be as big as possible, which will obviously benefit us too.
I guess it is well calculated. Based on historic numbers and a vision to sell more we agree on a deal that can potentially land us a 5 m more or so. But without that clause Nike would not be able to win the case as NB could just cough up any number Nike put on the table.
Sound to me that they decided the basic concept for us to have red shirt, red shorts and red socks for the home jersey. Green and Black for 3rd and Black all for away. So then we can work on the details.
Lovely stuff. This is the kind of kit that would really higglight my beerbelly. Guess it will be the old Molbyshirt yet another season
Nah. Fk that shit.
Do you think NB could afford to pay us £80m a year with their poor distribution / sales.?
Its only because we were dumb enough to go for £30m + 20%, that NB thought "I wanna play too"
For the record, I'd happily take those ace NB kits and a guaranteed 80m a year.
You dont get it so I try one more time.
NB went to court to renew the deal. The option is if they can match whatever offer someone else make the deal is their.
The only way we can show a number they can't reach is if we mix in a factor they can't reach. They can't distribute the same number of shirts through their limited system.
And then we get the new supplier.
Actually no. The Nike stars were the deciding factor not distribution.
I think it would be considerably more worrying if we were not able to use lines like that in respect of FSG. They've taken our commercial brand to a whole new level. It was something we always knew wasn't good enough under Moores and H&G were obviously an unmitigated disaster. Obviously, we could have the beneficent billionaire model of ownership in which a great business model is not as essential, but that's not our path.
I'm not sure we'd risk this kind of unusual deal if we only expected to generate an extra 5m.
I don’t know mate. As we renew the "old" deal it clearly gives is a big lift, but so would a renewal of NB deal. So the club probably believe the total exposure and cooperation with Nike will add more value than the NB package. I dont know how long the new deal is for, but the total package over let say 5 years (and on) we will be better off than NB can offer. But no doubt that if it was just a flat number NB could match it if they wanted?
It's not just 5m a year.
I couldn't calculate it, I'm damn sure they did, but there's also an increase in exposure & fans by simply being in every nike store window. Combine that exposure with winning shiny things & having the likes of Salah & Mane pictured holding aloft trophies in prime city centre real estate all around the globe & who knows how many potential fans, esp young fans, you can reach.
That's HUGE potential future revenue that's currently untapped.
What strikes me is that people doesn't see a potential upside if we are successful. I mean they have definately calculated what a normal progress pay us so there is probably not a big downfall anyway.
Reminds me a bit about Oil Economy. So many countries sold their fortunes for a fixed sum while in Norway we took the risk and subsidiced the companies exploration and production, but we take 78 % of their profitt. And here we are stinking rich.
We are in a good and healthy position to risk a bit in order to score the world domination in sportskits.
Reminds me a bit about Oil Economy. So many countries sold their fortunes for a fixed sum while in Norway we took the risk and subsidiced the companies exploration and production, but we take 78 % of their profitt. And here we are stinking rich.
We are in a good and healthy position to risk a bit in order to score the world domination in sportskits.
No you don't get it.
If Nike offered 80m a year, NB would bow out.
Since Nike offered 30m + %, NB matched it.
The judge saved our ass. The celebrity point was total bs
But they clearly didn't offer us 80? So discussing that is a bit pointless.
Except when you replace the word 'oil' with the words 'bitcoin' 'tulips', or 'subprime mortgage'
Look I want to be as hopeful as the rest of you.
I think the club have thought this through and hopefully there is more to the formula than was revealed in court, or we really have already bribed the PL to let us win it so it's a given.
I just don't think Nike are fools either, and frankly this deal sounds a lot more like it protects Nike than it helps us.
I think the club have thought this through and hopefully there is more to the formula than was revealed in court, or we really have already bribed the PL to let us win it so it's a given.
I just don't think Nike are fools either, and frankly this deal sounds a lot more like it protects Nike than it helps us.
I'm also guessing variety of apparels on offer is also greater. Nike baby LFC suits will now sell for £35 and not the £15 we have now
As well as that :
5m being twenty percent of sales, means sales of 25m.
Nike wouldn't pay 30m for the right to sell 25m worth of kit.
Nike doesn't strike me as the company who need protection. They are supercommercial hardpushing sales company. The part where we are involved is probably a few percentage (if that much even) of their portfolio. But they love to protect their earnings and profitt and there is were we now are getting a slice. I think they would prefer to keep that themselves.
I admire your mathskills as well as you businesslogics. However the discussion was 5 extra millions. So we dont start at 0. We start at around 65 to 75 million and add 5 million on that. So the 25 million in shirt sales come on top of that.
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