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What is the JJB deal actually gaining us?


DadoPrso9

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A guaranteed £3m per year ... no matter what the level of sales are.

In this climate of stagnating high street sales, having a guaranteed income from merchandising is now looking like an inspired bit of business & forethought.

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Releasing their accounts for the year ended June 2006, Rangers were able to report their net debt was slashed by more than £17 million from the £23.1 million they posted 12 months previously. The biggest single factor in the dramatic change was the i

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nitial £18 million payment received from JJB Sports when its ten-year contract kicked in on 8 June.

Under the terms of the deal, Rangers are also guaranteed a minimum annual royalty payment of £3 million in each year of the licence with additional payments realised if agreed sales thresholds are exceeded. According to club chairman and owner David Murray, "early indications in this respect are positive".

http://sport.scotsman.com/rangersfc/Ranger...-17m.2804541.jp

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I don't think it was a great deal for us actually.

Was the figure as high as £3m per annum? I thought it was £18m over ten years + extra's based on sales.

Nope ... £18m up front + £3m per annum PLUS extras if we reaches certain sales figures.

I remember when the deal was signed, the figures being quoted where that the money being made from JJB deal was more than we would have made in nett profit from ALL sales generated via the shops (Gross profit being money made before wages, rent, utilites etc )

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I don't think it was a great deal for us actually.

Was the figure as high as £3m per annum? I thought it was £18m over ten years + extra's based on sales.

£18million was the upfront payment (which is being distributed evenly to the profit/loss account over the 10 years).

We also get £3million per year plus any bonus payments.

That side of the deal is pretty good but I'm surprised Rangers, JJB and Umbro/Nike don't want to work together to improve the commercial aspects of it which seem to have been very disappointing so far.

If I'm being honest, I doubt the deal will last the 10 years.

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