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Nike postpones Euro 2020 national team kit launches as contracts scrutinised

(Photo by Michael Regan/Getty Images)

Nike’s launch of Euro 2020 national team kits for England, France and three other European countries were postponed this week because of the Covid-19 pandemic.

SportBusiness understands that Nike and the Football Association had planned for the kit release this week.

However, the postponement of Euro 2020 to a similar time window next year will cause particular sales and planning problems for major manufacturers like Nike and adidas. Sportswear firms have also suffered delays in the supply of kit from manufacturing clusters in China.

Nike had to delay its kit launch for the new French shirt, which was scheduled for the beginning of this week, reports L’Équipe.  Nike had also scheduled kit launches for Croatia, Portugal and the Netherlands, as well as Brazil.

According to one national team kit supplier, Nike would have been well advanced in its manufacturing and distribution process given the need to freight its products from factories in Asian markets, like China and Pakistan.

The source told SportBusiness: “In most cases, goods will already be ready for shipping, to allow them the time to take consignment and begin distribution. I would imagine that Nike, given the number of countries they have, and the high level of retail numbers involved, will already have the shirts in their European distribution centre in Belgium.”

Smaller suppliers with European manufacturing bases may not be at such an advanced stage and can simply halt production, the source said.

Adidas released its national team kits for Germany, Spain, Belgium, Russia and Sweden in November, but will miss the optimum sales window this spring and summer because of the Euro 2020 postponement and closure of stores in countries under lockdown.

The combination of sportswear stores being closed and consumers staying at home has inevitably led to various national teams and clubs postponing their launches. Ligue 1 giants Paris Saint-Germain told L’Équipe that its presentation of next season’s Nike kit, which would ordinarily take place between May and July, has been suspended.

Significantly, some national team contracts among the teams to have qualified for Euro 2020 are due to terminate after the previously scheduled date for the tournament. This means there will be companies sitting on stock for national teams they may not have under contract beyond July 2020, the source said.

While most of the major players have extended to 2026 and beyond, it is not yet clear how the issue will be resolved.

Euro 2020 was scheduled to take place in twelve cities across Europe from June 12 to July 12, 2020. The proposed new dates are June 11 to July 11, 2021.

Andy Korman, senior sponsorship consultant at The Sports Consultancy (and partner at its legal service, TSC Legal), said that contracts will differ, with some having exact stop dates, such as July 31, 2020, whereas others may stipulate the end of the contract as one week after the European Championships, which would protect the kit supplier.

He is advising his clients to examine their contracts for the above, as well as for force majeure clauses, and to be ready to make “realistic commercial compromises”. These could include reduced rates for the extra year, enhanced renewal terms or more generous use of player assets during the term.

Meanwhile, there are added complications to navigate through at Premier League champions elect Liverpool, where New Balance was ousted in favour of Nike from next season after a court case to decide whether Nike had the right to override New Balance’s option to renew.

Should the season need to be finished in September or October, Korman again called for realistic commercial compromises, which could mean New Balance paying for the extra months at a reduced rate.

Changes in a club’s main shirt sponsor at the end of this season could also complicate matters. Alex Kelham, partner at law firm Lewis Silkin, told SportBusiness that it would be sensible if agreements can be reached so that the existing deals will be extended to the end of the season, and the start of the new deals are similarly delayed.

She said: “The fact that the Premier League rules, for example, don’t readily allow the kit design or shirt sponsor to be changed mid-season, is also persuasive in this regard.

“Each contract will need to be looked at carefully to determine the legal rights and option of the parties, but even then there may not be a clear answer. Unfortunately, the situation we now face is unlikely to have been anticipated, even in the most carefully negotiated deals.”