By Paul Nicholson
January 10 – Nike and adidas have been referred to the UK government’s Office of Fair Trading (OFT) anti-cartel unit following their decisions to supply major outlets only. So far, though, adidas have not been contacted by the OFT regarding an investigation.
The world’s leading sportswear brands who are currently warming up for a big battle for global appareil World Cup 2014 supremacy – adidas sponsors FIFA, the jewel in Nike’s football sponsorship crown is the Brazilian national team – are not supplying independent retailers in the UK who sell less than £25,000 of their products a year.
The small retailers have complained that they rely on the big brands to draw in customers, and if their product is withdrawn they could be force to close.
The decisions by the two sportswear giants has been widely criticised by government who have asked them to reconsider, though currently the both companies appear to be sticking to their guns.
In a statement to Insideworldfootball adidas said: “This decision was not taken lightly but it is in line with our global commercial policy and was made to ensure our business is solid and sustainable, and operates in the most efficient way.
“All businesses regularly review how they take their products to market and we will continue to supply a wide range of retailers, many of which are independents.”
The Office of Fair Trading’s cartel unit is expected to look at whether Nike and adidas have broken the Competition Act or Article 81 of the EC Treaty. The investigators would also examine whether a criminal offense under the Enterprise Act has been committed.
The penalty for being convicted of involvement in cartels can be up to five years imprisonment or an unlimited fine.
Adidas have already become engaged in a stand off with major UK retailer Sports Direct and its football club owning and controlling shareholder Mike Ashley. Ashley was angered that while players over the season would be wearing boots of different colours, Sports Direct is only being supplied by black boots. See Matt Scott column at http://www.insideworldfootball.com/matt-scott/13809-matt-scott-what-adidas-s-row-with-sports-direct-tells-us-about-the-direction-for-sport
Adidas expects to hit record sales of €2 billion from its football product worldwide in 2014 as it benefits from it position as official sponsor, supplier and licensee of the 2014 FIFA World Cup.
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