Want to buy a new away top from the club shop?

Nano said:
Losing margin is a stupid thing to worry about on a product you make a massive margin on and it's much harder to calculate what your maximum volume is without actually selling your maximum. The only reason that this is an issue is because the club are too dumb or too cheap to have a contract which allows them to order from Errea on demand instead of in bulk because they think margin is the only thing that matters.

If you think your maximum volume is 11k and you buy 10k and they all sell out at full price then it seems like you've done an ok job. If your actual maximum volume would have been 20k then you've done a terrible job. If actual demand is about 15k between people willing to pay full price and people willing to pay half price then instead of worrying about over ordering and selling 11k at full price and then 4k at half price (which are still profitable) you are limiting yourself to only ever selling 10k. Margin on its own means nothing. Margin x volume = profit and 11k at £30 profit and 4k at £5 profit with an average profit of £23 instead of £30 is better because total profit is higher.

Obviously numbers here are made up but the principle stands. I don't know any other business that would risk not selling something at full margin to remove the chance of having to sell something at a smaller margin. Once again it is another business practice where MFC are the only business in the world that are operating that way as if they are right and every other far more competent business is wrong.
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I’ll start by saying I agree with everyone’s frustrations - improvements must be made.

However, I think you’ve massively misunderstood the economics of football shirts. There are some excellent episodes of price of football podcast which go to explain a lot of it. It’s a totally different game between the top PL teams and the rest. Although we can’t know the exact details of the deal boro and any of our manufacturers have, it is widely known in the industry that clubs make between 3-6% profit margin on shirts at full price.

Making some assumption, say the club sell 10,000 at full price, and being extra generous that they make 8% margin, they make £4.40 per shirt and £44,000 in total. If they then sell another 1,000 at £45, they loose £5.60 per shirt and loose £5,600 on those 1,000. Now those number might be way out, but the principal isn’t. The margin is so small for them that it is much better (from a money making point of view) to sell what you know you can, at full price, than speculate higher. In this example if you have to knock the shirt to half price for that extra 1,000, the club looses half the profit they made on the 10,000 they sold at full price.

It would be beneficial if MFC gave us some of the numbers behind the scenes to help people understand. Did they order enough to cover more than what they sold last season but have sold it all already for example?
 
Pak_Doo_Ik said:
Was our retail manager on The Apprentice cos this smacks of a week 2 selling taps and running out of stock by midday on the first day.

It’s just the same merry go round every year.

March - season ticket increases justified by people telling us that dare criticise we don’t know what we’re talking about when it comes to revenue generation

July - Walk up price increases announced, again justified to us critics as we don’t know anything about revenue generation

Then lo and behold new season shirts sell out within 2 days and no more stock to arrive for months.

But hey ho the club are the experts when it comes to revenue generation.

Im sure our commercial manager must have been on The Apprentice as this smacks of a week 2 selling task and running out of stock by midday on the first day. Not sure they’d make it to week 3🙈
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Whilst I dont disagree with much of what you wrote, the club dont care about revenue generation, they care about profit generation and with that comes minimising losses which they seem obsessed with (as per the statement from the head of retail).
 
Air Resistance said:
I’ll start by saying I agree with everyone’s frustrations - improvements must be made.

However, I think you’ve massively misunderstood the economics of football shirts. There are some excellent episodes of price of football podcast which go to explain a lot of it. It’s a totally different game between the top PL teams and the rest. Although we can’t know the exact details of the deal boro and any of our manufacturers have, it is widely known in the industry that clubs make between 3-6% profit margin on shirts at full price.

Making some assumption, say the club sell 10,000 at full price, and being extra generous that they make 8% margin, they make £4.40 per shirt and £44,000 in total. If they then sell another 1,000 at £45, they loose £5.60 per shirt and loose £5,600 on those 1,000. Now those number might be way out, but the principal isn’t. The margin is so small for them that it is much better (from a money making point of view) to sell what you know you can, at full price, than speculate higher. In this example if you have to knock the shirt to half price for that extra 1,000, the club looses half the profit they made on the 10,000 they sold at full price.

It would be beneficial if MFC gave us some of the numbers behind the scenes to help people understand. Did they order enough to cover more than what they sold last season but have sold it all already for example?
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Great points, but I dont think the club have a clue how many the "could sell" if they were able to get them in on time, and made available to purchase in a decent way to the entire fan base (not just those who live in Middlesbrough town centre).
 
Would a starting point not just be total sales of previous year. It appears to me they are drip feed in to store over course of the season. If we sold 10k then order 10k in roughly same sizes, and they must know if sold out of medium in August then they could order a few more without to much risk.

My daughter wanted one, now not available till October, that's when it's cold and she won't wear it and wanted it for her holidays. Prob won't bother now
 
NYboro said:
If you're in Spain, the removal of VAT should about cover that. Certainly used to when I was in the States.
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Good point. I’m actually in the states these days as well. Moved from Madrid about 2 years ago. 👍

Will need to keep my eyes peeled for when they come back online
 
Air Resistance said:
I’ll start by saying I agree with everyone’s frustrations - improvements must be made.

However, I think you’ve massively misunderstood the economics of football shirts. There are some excellent episodes of price of football podcast which go to explain a lot of it. It’s a totally different game between the top PL teams and the rest. Although we can’t know the exact details of the deal boro and any of our manufacturers have, it is widely known in the industry that clubs make between 3-6% profit margin on shirts at full price.

Making some assumption, say the club sell 10,000 at full price, and being extra generous that they make 8% margin, they make £4.40 per shirt and £44,000 in total. If they then sell another 1,000 at £45, they loose £5.60 per shirt and loose £5,600 on those 1,000. Now those number might be way out, but the principal isn’t. The margin is so small for them that it is much better (from a money making point of view) to sell what you know you can, at full price, than speculate higher. In this example if you have to knock the shirt to half price for that extra 1,000, the club looses half the profit they made on the 10,000 they sold at full price.

It would be beneficial if MFC gave us some of the numbers behind the scenes to help people understand. Did they order enough to cover more than what they sold last season but have sold it all already for example?
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I really do not believe those figures are even remotely true. Kits cost pennies to make. Online sources say £8 but it's probably less. A £55 shirt does not have a small margin. Look at items that Errea sell with no badge and one that has the Boro badge on and the price is double. There is a huge difference between the way the top clubs operate and maybe that is where your confusion is coming from. Teams like Utd do a deal with Nike where Nike pay them £100m up front to be able to supply the kit. It is then up to Nike to sell them and they have to recover their upfront costs. If they buy Ronaldo and sell double the shirts they were expecting it is Nike that gets the big benefit, not Utd, unless they sell them directly. Man Utd sell their own kits but they are available everywhere so it's not all of them, there are other retailers taking their cut. The profit per kit is low but that's excluding the big upfront contract they have received from the supplier.

We don't do that though. We buy kit in bulk, we have a single retail unit with a small amount of staff and we make a profit on deliveries. Our margin on a kit is massive.
 
Air Resistance said:
I’ll start by saying I agree with everyone’s frustrations - improvements must be made.

However, I think you’ve massively misunderstood the economics of football shirts. There are some excellent episodes of price of football podcast which go to explain a lot of it. It’s a totally different game between the top PL teams and the rest. Although we can’t know the exact details of the deal boro and any of our manufacturers have, it is widely known in the industry that clubs make between 3-6% profit margin on shirts at full price.

Making some assumption, say the club sell 10,000 at full price, and being extra generous that they make 8% margin, they make £4.40 per shirt and £44,000 in total. If they then sell another 1,000 at £45, they loose £5.60 per shirt and loose £5,600 on those 1,000. Now those number might be way out, but the principal isn’t. The margin is so small for them that it is much better (from a money making point of view) to sell what you know you can, at full price, than speculate higher. In this example if you have to knock the shirt to half price for that extra 1,000, the club looses half the profit they made on the 10,000 they sold at full price.

It would be beneficial if MFC gave us some of the numbers behind the scenes to help people understand. Did they order enough to cover more than what they sold last season but have sold it all already for example?
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We manager our margins with our retail prices tho, again in no shock to anyone we charge the acceptable max we can for the shirts at £55 and that staggered down through age groups.

Millwall after a quick check, same league also with Errea charge £50 ( not huge difference but still £5 per adult shirt) so they either have a better deal with Errea than we do, or are happy making a smaller margin by charging less (very unlikely).

They might get a discounted rate to us if they are buying higher QTYs in the initial buys, which would make sense as they are doing one larger production run rather than several smaller runs at factory.

However looking at Cheltenham much smaller club than us also with Errea they are charging £45 for their Kits. So based on such small margins do we believe a club like Cheltenham are selling shirts at cost price to the club, of course not.

We should be making a really healthy margin on our kits and if we are not its down to poor management our side, nothing to do with Errea.

Just to note both Millwall and Cheltenham have nearly fully availability in all their new kits too.
 
Nano said:
I really do not believe those figures are even remotely true. Kits cost pennies to make. Online sources say £8 but it's probably less. A £55 shirt does not have a small margin. Look at items that Errea sell with no badge and one that has the Boro badge on and the price is double. There is a huge difference between the way the top clubs operate and maybe that is where your confusion is coming from. Teams like Utd do a deal with Nike where Nike pay them £100m up front to be able to supply the kit. It is then up to Nike to sell them and they have to recover their upfront costs. If they buy Ronaldo and sell double the shirts they were expecting it is Nike that gets the big benefit, not Utd, unless they sell them directly. Man Utd sell their own kits but they are available everywhere so it's not all of them, there are other retailers taking their cut. The profit per kit is low but that's excluding the big upfront contract they have received from the supplier.

We don't do that though. We buy kit in bulk, we have a single retail unit with a small amount of staff and we make a profit on deliveries. Our margin on a kit is massive.
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I’m not getting them confused at all, I pointed out at the start of my post that it’s a complete different model with top PL teams. Not comparable whatsoever.

I think you’ve misinterpreted what I’ve said, I was talking about the profit margin for the club being low. Be in no doubt there are profits being made elsewhere, but clubs make little money from shirts in the scheme of things. There are limited companies who have the facilities to design and produce the range of products to a reasonable and consistent quality, so the competition isn’t there to drive much better value. Most manufacturers would just dictate terms to us as our 10,000 order is a drop in the ocean for them.

As for a single retail point, as soon as you bring in external retailers, that’s another cut off the margin. In this day and age selling at sports direct etc… would have absolutely no benefit as most clothes are purchased online anyway.
 
Nano said:
As someone who lives outside the area I would pay for things like a woolly hat, cap, t-shirt or a mug etc but the delivery price stops me from ever doing it.Instead of me making regular purchases they get nothing from me.
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Same here Nano.

I might be a mug in that I've just bought my Boro Membership (despite the fact that I'll probably only make a couple of home and away games this season), but I draw the line at getting ripped off for P&P.
 
It’s unbelievable that we have the aspirations to be a premiership club. We couldn’t be more amateur. To not have enough kits on the run up to the season when kids want them for there holidays is unbelievable. My lads away now, no kit, we go away in a fortnight I doubt it will turn up at his mams on time.
The club and the club only are accountable for this, you don’t hear of this happening at other clubs, they need to get there sh.t together,
I might get stick for this but the club have forced me into going online and buying the dodgy kits, if they’re ok I won’t be back buying from the club.
I love the club and would rather the club benefit from my hard earned cash but in all honesty from a retail perspective they don’t deserve it
 
Nano said:
Football kits are only relevant for one season. There are a lot of people that will pay full price to have it on release day and lots of people that will pay full price to have it as a gift for a birthday or Xmas. The market for people that want a kit for half-price at the end of the season is not the same as the market that want this year's kit for the season the players are wearing it. There are some that will wait but the majority want the kits in the first half of the season. I see other clubs kits discounted at the end of the year all the time and they seem to be doing alright.

The NEXT thing is very different because their items are not like a football kit and only relevant for a specific time period. That was also a specific strategy to get people buying NEXT stuff. The people that are willing to queue at 6am on Boxing day are on mailing lists and spend money in Next all year long. They are also selling 100s of product lines and some are more in demand than others. Football clubs have 2 or 3 kits a year so predicting demand is far simpler.
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Hundred percent this is right. Since turning about twenty I've never bought a Boro top until they started selling half price stuff toward the end of the season, when I started buying tops and training stuff.

I still do not buy new tops, but buy them for my kids. My kids will not want a half price 'old' top near the end of the season.

If the second or third kit is in the shop in October we'll buy one for the kids for Xmas. If they aren't, we'll buy both kits knock off for them and that'll be a shame.
 
Air Resistance said:
I’m not getting them confused at all, I pointed out at the start of my post that it’s a complete different model with top PL teams. Not comparable whatsoever.

I think you’ve misinterpreted what I’ve said, I was talking about the profit margin for the club being low. Be in no doubt there are profits being made elsewhere, but clubs make little money from shirts in the scheme of things. There are limited companies who have the facilities to design and produce the range of products to a reasonable and consistent quality, so the competition isn’t there to drive much better value. Most manufacturers would just dictate terms to us as our 10,000 order is a drop in the ocean for them.

As for a single retail point, as soon as you bring in external retailers, that’s another cut off the margin. In this day and age selling at sports direct etc… would have absolutely no benefit as most clothes are purchased online anyway.
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Maybe someone should put them in touch with dh gate. They'd make a killing reselling their kits in the club shop 😁
 
weemoby said:
Same here Nano.

I might be a mug in that I've just bought my Boro Membership (despite the fact that I'll probably only make a couple of home and away games this season), but I draw the line at getting ripped off for P&P.
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And me.

i might be sad but i do like stuff like key rings, mugs, etc. No way would I pay the P&P

Like I mentioned up the thread. I’m up here for Portsmouth game and was hoping to get a top then. Not sure I’ll bother tbh if they aren’t available until October.
 
Aet290204 said:
They’ve always given the impression to me they don’t care about anyone who doesn’t have a TS postcode. But then I’m an outsider looking in.
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They dont despite the fact that many Teessiders have moved away from the area, and some of us still support them both financially as well as vocally.
 
Air Resistance said:
I’m not getting them confused at all, I pointed out at the start of my post that it’s a complete different model with top PL teams. Not comparable whatsoever.

I think you’ve misinterpreted what I’ve said, I was talking about the profit margin for the club being low. Be in no doubt there are profits being made elsewhere, but clubs make little money from shirts in the scheme of things. There are limited companies who have the facilities to design and produce the range of products to a reasonable and consistent quality, so the competition isn’t there to drive much better value. Most manufacturers would just dictate terms to us as our 10,000 order is a drop in the ocean for them.

As for a single retail point, as soon as you bring in external retailers, that’s another cut off the margin. In this day and age selling at sports direct etc… would have absolutely no benefit as most clothes are purchased online anyway.
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The single retail point was to show that the profit margin you have mentioned includes a big chunk of cost to a retailer but we are the retailer so that cost (and retailer profit belongs to the club). Total profit on shirts is relatively low but the margin isn't, it is huge. There is plenty of room in there for selling some at a discount at the end of the season.

There are millions of companies that can pump out 1000s of shirts. Especially as a bulk order. Who do you think is making all the clothes for the billions of people in the world? The cost to produce the kits is about £5 per kit. The rest of the costs are marketing, retailers and distributors and they are all MFC because we don't use anyone else and the distributors aren't included in the £55 because we charge for delivery. We have a single supplier requiring a single delivery to a single store. If it costs the club more than £10 total per kit from Errea then they are doing something drastically wrong. Do you really think there is a big difference between a £55 kit with a Boro badge on and a £100 kit with a Utd badge on and a £10 generic kit with no club badge? The cost to produce them all are the same. The mark-up is because the market says people will pay £55. The profit margin is huge because of that.

The major difference between the big clubs and us is that the big clubs charge a huge fee for the kit suppliers to supply their kit. We either charge a much smaller fee, which means some of the margin is in the fee, or we don't charge a fee and we just pay per unit which means Errea take their profit when they sell to us and we make the margin when selling to fans. It is most likely the latter and there is plenty of margin in there.
 
Aet290204 said:
They’ve always given the impression to me they don’t care about anyone who doesn’t have a TS postcode. But then I’m an outsider looking in.
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I mean.. even then. How hard does it have to be to buy something out of a shop?
 
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