NFL Lockout vs. NFL Licensed Product Sales

July 5, 2011 at 3:37 pm by Ted Mininni

Here we are: the clock’s ticking and still no resolution to the NFL lockout. And the news is bad all the way around. Bad for teams, owners, players and fans. Bad for football. We can talk about the reasons, the greed, etc, but have we talked about the result if the lockout precludes training camps where fans can watch their favorite veterans and new draft picks up close? About the possibility of no preseason games? About the terrible possibility of no regular season?

Not a happy prospect for legions of football fans. Not a happy thought for a die-hard, life-long Philadelphia Eagles fan like me either.

As bad as all of this is for the sport and the hugely powerful NFL, nobody’s talking about retailers. How will this affect the licensed sports merchandise industry? The Washington Post reports sales totaled $2.5 billion in NFL licensed consumer products in 2009 alone. A chunk of those sales are generated directly by the NFL, so what about the potential for revenue loss for each team as well as myriad independent retailers who make a living selling sports merchandise?

Sure, those retailers can sell merchandise related to local schools, MLB, the NHL and the NBA to make up for those losses to some extent. But wait: the NBA is in lockout mode, too. Not good, either, is it?

Since the NFL is the largest organization in professional sports with the most significant fan base, the ramifications of slowing sales due to fan turn-off can hardly be over-exaggerated. This leaves store owners in a quandary: how much merchandise should they order? If they order lightly now, and the season is back on in a few weeks, what if they order heavily along with the Wal-Marts of the world? Will they receive enough stock to meet demand?

On the flip side, if they order as they normally do pre-season, will they have to take massive markdowns if the season doesn’t materialize?

Talk about a tough call!

What do you think?

What’s going to happen in your view?
What should sporting goods retailers do when it comes to ordering NFL licensed merchandise? Err on the side of ordering less or hope for the best and order as they normally do when the season is on?
What will the lockout do to the image of brand NFL? Will it take a hit? Or will fans be back as soon as there’s a settlement?

Categories:

Licensing, Consumer Products

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