Thread by @calciocarl, Final bit of my business of football kit threads, unless somebody can [...]

Final bit of my business of football kit threads, unless somebody can think of anything else!

We’ve all heard it, ‘if we bought Mr Super Star, he’d pay for himself in just the shirt sales’.

So is it possible?

Here we’ll explore where the profit of shirt sales goes.

The most recent high profile case of a galactico moving & this to be questioned is Ronaldo’s move to Juve. Info graphics circulated within 24hrs showing that Juve had sold 520k Ronaldo shirts in 24hrs with an estimated turnover of £35m. Surely it therefore pays for itself?

The answer is no.

First let’s see what the actual cost of Ronaldo is. The fee confirmed for by both clubs was £101m, wages were confirmed at £26m a year & it was a 4 year contract.

Without bonuses, image rights this equates to £51.2m a season.

That’s a lot of shirts!

The first key point is what is the incremental amount of shirts sold? Juve are one of the worlds biggest clubs (all the refs support them

). Their shirt sales are the envy of many at 850k per year before Ronaldo joined.

With Ronaldo that amount went up but not massively, it is estimated that Juve sold 1m shirts last season. This is for 2 reasons, firstly, they had placed their order for shirts 6 months before they bought CR7, in effect they sold out & it took several months to get back shirts.

Secondly, 520k Ronaldo shirts may have been sold within 24hrs but very little else did. The usual names of Dybala, Pjanic had been swapped for CR7. In effect, Ronaldo shirt sales had cannibalised shirt sales of other players. There’s no doubt though he drove shirt sales.

The value of those shirt sales to Juve is offen over stated. One paper announced the day after his move that he had paid for half his fee already. They simply took the retail price x the number of shirts & came up with a sexy big number.

It misses the point that the shirt wasn’t free to produce & Juve didn’t sell all the shirts. Let’s look at both of those points separately, a lot of this refers back to things I’ve tweeted in the last 48 hours.

Firstly, Adidas pay a very big fee to Juve estimated at £47m a year

This is paid if CR7 is there or not. You could argue he gives them more pulling power but it’s a deal that was in place before he joined. Adidas then sell shirts to Juventus, that price will be around £22. When Juve sell a shirt for £60 in their store they make £38.

It’s not an insignificant amount / shirt but it’s also not £60. Critical though is the second point, Juve are a global brand, more shirts are sold by Adidas / other retailers than by Juventus. For these shirt sales Juve get a commission normally around 15% of cost price.

Let’s round that up to £3.50 going to Juve. If we take those 520k CR7 shirts that were sold in 24 hours & assume 40% sold by Juve & 60% by everyone else then that would mean the following profit to Juve
Profit Juve generated > £7.9m
Royalty to Juve > £1.1m
Total > £9.0m

Let’s remember that not all of this would be incremental, it has been a switching from other players to Ronaldo. That said, £9m to Juve in 24 hours isn’t insignificant, it’s not half the CR7 fee though lazily reported by the press.

Don’t get me wrong, signing a star player helps shirt sales, I’m not suggesting I don’t want to see Messi at Palace but unfortunately the shirt sales alone won’t cover a star players wages for the year let alone the fee.

Not all the numbers above are exact but not far out.

I think that’s me done.

Feel free to ask any questions.

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