BCCI mulls kit supply tender with Nike deal almost up
The Board of Control for Cricket in India is considering launching a tender for kit sponsorship rights as its long-standing deal with sportswear giant Nike nears an end.
Nike has been the country’s kit supplier since 2006 but its present four-year deal, worth a total of around Rs3.7 billion ($49 million), expires in September.
Due to the coronavirus pandemic, it is believed that Nike may be unwilling to renew its agreement with India on the same terms.
With the BCCI understood to be seeking a similar deal or higher, it is weighing up a tender process to test the market and engage interested suitors.
Despite the long partnership between the two parties, there have been some issues between them in recent years when the Indian national team players complained about the standard of clothing provided by the US firm.
If India and Nike part ways, it will bring to an end one of the longest kit deals in cricket.
Meanwhile, Nike has announced a 4 per cent drop in revenues to $37.4 billion for the financial year to 31 May, 2020.
It cited the impact of the Covid-19 crisis on business operations in the fourth quarter as a key reason for the decrease in turnover.
Nike’s fourth quarter revenues fell by 38 per cent to $6.3 billion, and down 36 per cent on a currency-neutral basis, "primarily due to owned and partner physical store closures across the North America, Europe, Middle East and Afria and Asia Pacific and Lain American regions."
In North America, EMEA and APLA, Nike said approximately 90 per cent of its stores were closed during the fourth quarter.
Prior to the pandemic, Nike revenue was up 9 per cent, or 11 per cent on a currency-neutral basis, “reflecting strong, broad-based consumer demand, higher full-price sales realization and a double-digit increase in digital sales.”
For the 2020 financial year, the brand’s digital sales increased 47 per cent, while revenues in Greater China increased 8 per cent.
Nike’s net income was $2.5 billion and diluted earnings per share was $1.60, down 36 per cent, which the company said was driven by lower revenue and gross margin impacted by Covid-19 in the fourth quarter.
The sportswear giant posted a net loss of $790 million in Q4 due to lower revenue and gross margin because of the impact on operations.
Nike said approximately 90 per cent of its stores are now open again globally.
Matt Friend, executive vice-president and chief financial officer, Nike said: “As physical retail re-opens, Nike's strong digital trends continue, a testament to the strength of our brand and the investments we've made to elevate digital consumer experiences.
“Amid macroeconomic uncertainty, we will continue to operate with agility, focused on optimising marketplace supply and demand, cost management and leveraging our financial strength to drive long-term sustainable, profitable growth.”