Sports Direct calls for review into market practices of ‘must-have’ brands
Sports Direct has called for a review into the market practices of “must-have” sports brands, after an article published in The Sunday Times indicated that Nike has notified independent retailers that access to its products will end in two years.
In reference to the article published yesterday (“Nike’s killer blow for small stores”), the Shirebrook-headquartered retailer has hit out at sportswear giants such as Nike and Adidas for withdrawing supplies of key products or simply refusing to supply them “with no apparent justification.”
It says such practices are “aimed at controlling the supply and, ultimately, the pricing of their products.”
According to the Sunday Times piece, Nike believes that many independent retailers’ ways of stocking its goods are “no longer aligned” with its distribution strategy, and retailers are “fearful that Adidas will follow suit.”
Sports Direct says the sportswear brands are implementing “segmentation” policies which restrict the range of products available to retailers, and that they sometimes refuse to supply certain retailers outright.
In a statement released via the London Stock Exchange this afternoon, the company said that it had “long fought against such practices and has historically sometimes found itself at a disadvantage”, citing Adidas’ decision to withdraw replica Chelsea football shirts from its stores in 2013.
The statement continues: “The sports industry has long been dominated by the ‘must-have’ brands such as Adidas. These ‘must-have’ brands hold an extremely strong bargaining position vis-à-vis the retailers within their supply networks and use their market power to implement market wide practices.
“Sports Direct believes that the industry as a whole would benefit from a wide market review by the appropriate authorities in both the UK and Europe.
“Sports Direct has consistently aimed to provide the widest range of products at attractive prices and will continue to work constructively with all its suppliers to enhance its product offering for the benefit of consumers.”
