Key commercial issues when negotiating a new official kit supplier agreement
An official kit supplier agreement is one of the most valuable and multi-faceted commercial rights transactions that a rights holder will enter into as, in effect, it is a combination of three types of contract that can be complex enough of their own accord, namely:
- a high-value supplier agreement (in respect of the kit);
- an international merchandising agreement (in relation to associated sales revenues); and
- a major sponsorship agreement (addressing branding and advertising rights granted to the supplier).
This article looks at some of the key commercial issues which rights holders need to consider when negotiating a new official kit supplier deal and explores some contractual solutions. It will be particularly useful for rights holders’ commercial teams and in-house lawyers to use during negotiations. It is focused on the supply of kit and equipment for use by teams and does not seek to address issues specifically related to individual endorsement deals. Specifically it looks at:
- The scope of the agreement;
- High-performance vs fanwear;
- Design process;
- Manufacture, payment and delivery;
- Protecting the value of the deal; and
- Expiry and termination.
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About the Author
Joe Tompkins: Senior Associate, Onside Law
Joe is a senior associate at onside law who specialises in commercial law in the sports sector. His particular focus is advising rights holders on contractual matters relating to the exploitation of their commercial and media rights, high-value sponsorship agreements and the delivery of international sporting events. He acts on a wide range of commercial matters for international federations, national governing bodies, clubs, individuals and agencies, including World Rugby, the ECB, Saracens, Team Sky and a Premier League football club.