Sports licensed apparel, which is not the same thing as team replicas, has been a big business in the U.S. for many years, but it is a relatively novel concept in Europe. Andrew Ronnie, a 43-year-old former executive of Ellesse who turned Diadora into a big success in the U.K., has successfully implemented this concept by licensing fleecewear and non-technical fan wear bearing the insignia of the team. All the items are designed in-house and sourced in the Far East.
His company, Source Lab, claims to have become the biggest licensed football apparel company in Europe, holding contracts with 13 prominent football teams in the U.K. and Ireland, plus the famous FC Barcelona team in Spain. It has just added Liverpool to its roster, joining Warrior Sports, which has taken the place of Adidas for its replica uniforms (see the previous issue of SGI Europe).
Source Lab's properties include big names such as Manchester United, Manchester City, Chelsea, Arsenal and the Glasgow Rangers, and they are selling well. The company is selling more than 2 million units of garments per year and its revenues are projected to grow by 25 percent in the year ending next May to a level of about £7.25 million (€8.7m-$11.4m). Clients include big chains such as JJB Sports and Sports Direct.
The company, which has a staff of 13 people, has been profitable since it started in 2004 as a sourcing agent for the Glasgow Rangers and Leeds United, working subsequently for Tesco and other big clients. Ronnie left Diadora in 2004 after raising its turnover in the U.K. from £2.9 million to £37.2 million in nine years.
Ronnie is now looking at replicating his business model with other football teams in the rest of Europe. He is also exploring China and the rest of Asia for further development. Source Lab has announced a partnership with Mulitex, a big sourcing and manufacturing partner in Hong Kong, to start an e-commerce operation in the region and to look into other product categories.
