The last 24 hours have seen the stepping up of the conflict between Sevco and their shirt manufacturer and key sponsor Puma, and that now looks absolutely certain to end up in the courts, and to having knock-on consequences at the club for years.
Earlier this month, this site broke the story that Puma had sent a high-level legal delegation to Ibrox in a final bid to seek an end to the stand-off with Sports Direct which was going to see Puma’s newly produced Sevco 2016-17 shirts sitting, unsold, in warehouses. They asked Sevco to get around the table with Ashley’s people, in the best interests of all parties.
They even offered to act as mediators.
That offer and all their other suggestions were rebuffed, with the club knowing full well that this was effectively the last chance to end the matter without much rancour and bitterness. To call the meeting a failure was an understatement; there are people inside Ibrox without any interest in letting things end easily or quietly.
At the start of the month, Puma and Sports Direct decided that they would offer the shirts for sale without the consent of the club. That the retail giant and the sportswear firm were able to come to an agreement like that was momentous news – bad news – for the club, but it was even worse because Ashley’s people had offered to put the shirts with any retail firm that wanted them, as the sole holders of a license to sell these kits.
Sevco squealed a little, but didn’t actually do very much about it, at least on the surface. Their thuggish fan reps demanded a continuation of the boycott, who’s ineffectiveness was shown when it was revealed this week that Sports Direct made over £3.5 profit from sales of Sevco stuff last year, whilst the club got £700,000 … much of which they had to then send back to SD for the unsold stock. (It’s a lovely deal Ashley has here, it really is.)
Then, this week, came ominous developments.
Puma suddenly withdrew the kit from their website, telling fans it was temporarily unavailable, although you can still buy it from their online Amazon store for the time being and you can, of course, still get it at Sports Direct and from the online “Sevco Megastore”. That wasn’t all. Sevco players were pictured at training in unbranded tops. Then, at yesterday’s press conference, all trace of Puma was missing from the official sponsorship advertising boards.
Now we’ve learned that all the in-stadium advertising has gone too.
Last week, King suggested that the club might well decide to tear up their agreement with Puma and actually produce another shirt for this season; it might well be the most ludicrous and dangerous move on the part of a football club I’ve ever heard of in my life. It’s virtually begging people to sue, and Puma have the deep pockets to do exactly that.
It does seem that the club is on the brink of telling Puma that their commercial deal is at an end. I can’t think of anything stupider than falling out, in such a public and unprofessional, way with the third biggest sportswear manufacturer in the world.
Puma might be rivals with Adidas and Nike, but these companies haven’t been accused of operating a cartel for nothing; they work together when it suits, they trade information, and they don’t undermine each other or undercut each other’s business. Troublesome “clients” are lucky if all they get are deals at a vastly reduced rates. After all, if your reputation is in the toilet you’re not going to spark a bidding war with these firms.
Sevco fans will wail that their “global fan base” makes it good business anyway. They miss the point. This is corporate politics; a major sponsor will only pay what it has to. If the club has a rep as being difficult to deal with, unwilling to play it straight, unpredictable in its dealings then that will be reflected in the offers they get, and they won’t get a better deal simply going elsewhere. The market rate for doing business with them will drop like a stone.
The Sports Direct contract has six years still to run; that will encompass the next round of major sponsorship deals they make, and impact the one after that. This will cost them many millions over the course of the next few years even if there are no legal consequences at all … which appears to be highly unlikely at best.
There will be a lot of PR hot air over this in the next few days and weeks, because this story hasn’t even started to get interesting yet. There’s a long way to go before these issues are resolved and there’ll be a good share of blood on the wall before it’s through, but at Ibrox they’re already feeling the pinch over this one.
Yesterday the Joelen Lescott deal collapsed in what might charitably be described as “shambolic circumstances”, with numerous stories getting out about the cause. As it turns out, Lescott’s people, who announced the snub was for “family reasons” had a lot more class than whichever Ibrox ally told the BBC that he’d failed the medical.
As per usual, they had failed to consider the blow-back and that came, as it was always going to, when the true story emerged via angry Aston Villa officials who firstly denied it was a medical problem and then confirmed what many had suspected; the problems were with money, and Sevco suddenly changing the terms of the deal.
Is that related to looming legal issues?
I’ll be very interested in what happens with this story next.
In Brendan We Trust.
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