Confirmed £90m Barcelona development could ring alarm bells at Tottenham

Developments in Barcelona could ring alarm bells for Tottenham’s most powerful decision makers.

Spurs are perhaps the best run club in the Premier League from a financial perspective.

And even if Daniel Levy‘s emphasis on sustainable growth has at times frustrated fans eager to see more action in the transfer market, the merits of his approach are hard to deny.

The club are in a uniquely favourable position when it comes to compliance with Premier League and UEFA spending rules, for example.

A large part of their PSR (formerly FFP) headroom is attributable to their commercial growth, with cash from sponsorship, events and merchandise sales hitting a club-record £228m in 2022-23.

The North London club are currently without a chief commercial officer following Todd Kline’s exit to Chelsea, but their overall situation remains very healthy.

However, the latest news from Spain could cause some hand-wringing.

Barcelona’s Nike case illustrates Spurs’ commercial danger

Of the £228m in commercial income generated by Spurs last season, around £30m came from kit manufacturer Nike.

In Spurs’ sponsorship portfolio, that figure is second only to front-of-shirt sponsor AIA, who pay £40m.

Fellow Nike-sponsored side Barcelona are earning around three times that amount from their deal with US sportswear giant.

However, the Catalan giants – who, incidentally, are in financial distress – are dissatisfied with that figure and wanted to cancel the contract early in order to create their own in-house kit brand.

But, as relayed by Sport Business earlier this week, Barcelona have been ordered to honour their contract with Nike until it ends in 2028.

This illustrates the potential dangers of locking into a long-term deal, which can prevent clubs from securing maximum value over the course of the deal.

Significantly, Spurs have signed with Nike until 2033 in one of the longest deals in the company’s history.

And while the relationship between the two entities is strong, this could theoretically cause issues further down the line.

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TBR Analysis: Why are Spurs striking long-term sponsorships?

While long-term deals do lock clubs into a fixed contract, they do also provide security for the likes of Spurs and give them the ability to forward-plan.

In any case, there will likely be performance-related bonuses in Spurs’ deal with Nike, for qualifying for the Champions League and so on.

The trade-off is whether these bonuses are worth the potential reduced base rate.