Tuesday, 23 August 2016

The Shirt Sale Myth: Analysing Its Impact On Clubs' Revenue

Ever since Real Madrid began on a path that would later rob the football transfer market of it’s dignity, the shirt sale has over the years become more or less the only point of argument for fans of clubs that spend ridiculous sums of money on acquiring the world’s best players or in some cases the most overrated.

The case of Pogba has seen the subject of player shirt sales elevated to ridiculous heights by Manchester United fans. How else can they justify their club paying such an amount for a player not yet the the finished product? 

Now trim off the speculations, dig for the facts and learn that the myth couldn’t be farther from the truth.

According to statistics by the marketing firm Euromericas as reported by Sky Sports, La Liga’s Barcelona sold the highest amount of authentic shirts (both replicas and non-replicas) during the 2015-2016 season with approximately 3.637 million worldwide, Bayern was second, with Chelsea – the top selling Premier League club with 3.102 million – coming third, Manchester United came fourth with 2.977 million and Real Madrid (2.866 million) rounded up the top five.

Manchester United then topped the list of replica shirts sold (2.850 million) with Anthony Martial’s number 9 jersey selling more than any other United player’s within the same time frame according to statistics by Adidas, KitBag and Sportdirect, reported by Total Sportek

FC Barcelona came second with 2.290 million (Messi selling the most) and Real Madrid – Ronaldo as its bestseller – completing the podium with 1.980 million shirt sold.

Facts collected from the official store websites of Manchester United and Real Madrid put the average amount for non-replica jerseys for top clubs at €80 (£69 or $90) per, while replica shirts of top players are often priced at €88 –  €95 (£76 – £82 or $100 – $108) per. 

Looking at these stats, one can easily get carried away by the figures that will appear on their calculators as this would mean Barcelona made at least €291 million (£251 million or $328 million) from all shirt sales from last season, while Manchester United would have cashed in at least €250 million (£216 million or $285 million) from replica shirt sales alone within the same period.

This is grossly misleading however, as it doesn’t account for profit sharing formula and most importantly, cost of production. 

Kit making companies like Adidas and Nike do not manufacture these shirts using magic beans. Raw materials are bought and paid for and such figures are often subtracted from the total amount of turnover before profits or loses can be determined.

As for the profits, there exits sharing formulas agreed to by the kit manufacturers, the football clubs, the football players (image rights) and the shipping companies in charge of distribution. 

Adidas and Nike don’t strike those impossible shirt-making deals with football clubs as charity gestures; it’s  all profit driven. In other words, they get their cut. No top player signs off 100 per cent of their image rights to their club and the distribution companies that partner these kit manufacturers to ensure that these jerseys are available in every major market don’t work for free.

When all these are factored in, the actual amount that goes to these clubs become significantly lower. According to Swiss Ramble as reported by Sportskeeda, top clubs get just €12 (£10 or $14) from each shirt sold but for the sake of the increase in the price of football jerseys since that report was first published, we bump that figure to €15 (£13 or $17).

This leaves Barcelona with roughly €55 million (£47 million or $62 million) from all jerseys sold last season and Manchester United with €45 million (£38 million or $51 million). 

These are still impressive sums and can definitely be used to fund the transfer of a very good player including wages and bonuses but let’s not forget that these are overall shirt sales of the named clubs, including replicas of all the clubs’ players and non-replicas. This leaves the believe that a player like Pogba or Neymar  can actually pay back their transfer fee plus wages through shirt sales at false.

Total Sportek places Paul Pogba at number four of the highest paid football players in the world with an annual wage (minus bonuses) of €16.17 million (£13.9 million or $18.34 million). Then include that transfer fee of €104 million (£89 million or $117 million) and the fact that jersey sales of players tend to decline drastically after their first season at a new club and it becomes obvious how impossible that myth seems.

Also read why Jose Mourinho can be perfect successor to Sir Alex HERE
The impact of shirt sales seems to be grossly overrated for whatever reason and so, the next time that Manchester United or Real Madrid fan try to tell you how that one player has or can pay back his transfer fee via shirt sale, feel free to let them know how utterly ridiculous they sound.

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