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Manchester United sponsorship deal could prove expensive for Nike
Published : 15 Nov 2012 08:17:29
Manchester United are 'bullish' about the prospects for future growth - and that could prove expensive for American sports' giants Nike.
United executives are due to sit down with their Nike counterparts in February at the start of an exclusive six-month negotiating period over their £303million kit supply deal. And it seems obvious Nike will have to come up with an enormous sum to satisfy the club's owners, the Glazer family.
"We feel we know, with some clarity, the value of our rights, and we are bullish about the abundance of opportunities available to accelerate the growth of this business," said United's executive vice-chairman Ed Woodward.
In July, United announced a staggering £357million deal with General Motors for the Chevrolet logo to be worn on their shirts for seven seasons from 2014. That figure prompted United to buy-out the present deal with DHL for the club's training kit, which will now come to an end at the climax of this season.
Woodward added: "The planning on DHL started post-GM deal. We are always monitoring the value of our rights. We can improve the amount, duration and rights-package about that deal. Our six-month negotiating window with them (Nike) starts in February. We look forward to sitting down with them then."
Privately, United officials do not see the way the Nike deal is structured fits with the more commercially aggressive Glazer regime.
Sponsorship certainly appears to be a lucrative revenue stream for United given they posted a 32% increase to £27.8million for the three months to September 30, 2013.
Including the General Motors contract, United did 10 sponsorship deals during that time, confirming an increase in workforce from 670 to 735 was almost exclusively connected to the marketing sector.
They now have mobile phone partnerships in 44 countries, with Woodward claiming the three-year deal with Japanese soft drinks manufacturer Kagome came as a direct result of opening an office in Hong Kong.
He added that the USA was the "next natural place" for the club to open a regional centre given as many supporters watch United live there as do so in the United Kingdom.