January 7 – Liverpool have formally announced that Nike will become the club’s official supplier from the start of the next season when the current New Balance deal ends.
The Nike deal has been the subject of legal challenges with New Balance, who have held the contract since 2015, having argued that it had a right to match any new offer for the contract. That argument failed in court leaving Liverpool free to complete the Nike agreement.
The new deal is likely to be worth upwards of £70 million annually for Liverpool, getting it close to if not beating the Manchester United deal with Adidas for £75 million annually.
The Nike deal has been reported as giving Liverpool a base £30 million a year guarantee with a 20% royalty on all merchandise sales on top of that. This is in fact lower than the previous £45 million-per-year guarantee from New Balance, but where Nike becomes more lucrative is in its global distribution network and ability to cross market with its other properties to sell more Liverpool product.
It is reported that Liverpool will also be given £2 million worth of licensed products per season to sell themselves, plus a 19% discount on standard UK wholesale prices for any additional products. There will be bonuses of £4 million for winning the Champions League and £2 million for reaching the final, plus £2 million for a Premier League win.
Liverpool described the deal in a club press release as a “multi-year partnership, which begins on June 1, 2020, will see Nike manufacture and supply Liverpool FC’s playing, training and travel wear.” Nike club deals have trended towards being 10-year agreements though the Liverpool may have managed to keep this contract to a four or five year term.
Nike will kit out the men’s, women’s and Academy squads, as well as coaching staff and Liverpool FC Foundation.
Billy Hogan, LFC’s managing director and chief commercial officer, said: “Our iconic kit is a key part of our history and identity. We welcome Nike into the LFC family as our new official kit supplier and expect them to be an incredible partner for the club, both at home and globally as we continue to expand our fanbase.”
Nike’s penetration in Asia and the North American market is the expansion carrot for the club.
Bert Hoyt, VP, GM Nike EMEA, said: “Liverpool Football Club has such a proud heritage and strong identity. The partnership with Liverpool FC underscores our leadership in global football and with the club’s passionate worldwide fanbase and strong legacy of success, they have a very bright future ahead.”
They certainly have a monied future ahead.
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