Manchester United is one of the biggest names in the sports industry. The British club has established itself as an international brand and has enjoyed success in the late 20th and early 21st centuries. Manchester United is more than a football team that plays in the premier league and other competitions. In fact, it is a large and vastly complex business. Numerous important activities take place behind the scene which allows the club to play competitive football. We are going to dive into the elements of Manchester United and explore how a professional football club works.
Manchester United is a Public Limited Company (PLC) which primarily works as a professional football club and engages in other activities that support the successful functioning of the club. Manchester United plays professional sport with the men’s and women’s teams and is involved in the training and development of the reserve team and youth academy. The teams compete in various competitions such as UEFA Champions League, Premier League, FA Cup, and FA Youth Cup. AON training centre in Carrington, Manchester is the base for all football-related activities. The sports facility consists of various football pitches, gyms, and strength and conditioning centres, etc. Furthermore, it is home to other activities such as sports nutrition and physiotherapy.
Except for professional football and related activities, the business operates in the following three sectors:
According to Forbes’ 2019 list of ‘The world’s most valuable soccer teams’, Manchester United ranked 3rd in terms of brand value and were the highest rated English team.
Manchester United aims to maximise revenue through a number of sources such as sponsorship and kit deals, digital content (television and gaming), retail and merchandising and product licensing, etc. Currently, Manchester United has the second-largest kit deal in football as they switched to German company TeamViewer for the upcoming season. The new deal will help them earn $325 million over a period of 5 years. This amounts to an average of $65 million per season.
Along with this, the company works in the sporting goods and services sector. They sell matchday and training kits, athleisure clothing, footwear, and accessories through the official club store, website, and other licensed retailers. Furthermore, they sell consumer products such as pens, coffee mugs, calendars, and household essentials such as towels, duvets, and pillows.
Their global television channel MUTV also generates revenue for the club. It gives fans access to match highlights, training clips, interviews, and behind-the-scenes videos on a pay-per-view basis. The company also maximises the potential of its global scouting network as well as the youth academy. Their world-class scouts identify talented individuals from around the world that would fit well in the teams and academies.
The company heavily relies on sponsorships for revenue generation. In the financial year ending 2019, the company earned £173.0 million from sponsorships deals. Manchester United and Adidas struck a deal that commenced in the 2015-16 season. The deal required Adidas to manufacture training and matchday kits, accessories, and travel wear for Manchester United. The club would earn £750m over a period of 10 years thanks to this deal. One of the biggest kit deals in history allowed two giants of the sports world, Manchester United and Adidas to maximise their brand value by working with each other.
Manchester United’s home stadium, Old Trafford is home to approximately 74,000 fans on each matchday. Matchday revenue is an important sector for the club. They generated 140.73 million dollars in 2019 from this sector. The club sells out season tickets and matchday tickets to fans at the start of each season. It is extremely hard to get a ticket because Old Trafford is always packed with enthusiastic supporters. On a matchday, various other activities also help in generating revenue for the club. Fans visiting the stadium get a chance to visit Man Utd’s megastore. The influx of people for matches attracts customers for the megastore thereby increasing revenue. Moreover, there are food stalls and other facilities within the stadium which further amount to increased revenue. The whole experience of each fan visiting Old Trafford on a matchday directly helps in increasing revenue for the club.
Manchester United isn’t just a football club, it is a fully functioning business. Professional football is just one sector of the company. Various activities must be done with care and precision as everything happening on the business side of the company will directly affect the players on the field as well as fans from around the world. Running a football club isn’t as easy as it looks because there are a number of activities that are taking place behind the scenes. With Jadon Sancho’s transfer completed and the club recovering from the coronavirus pandemic, will they finally get their hands on the premier league trophy, or are the fans again going to demand the owners to stand down? #GlazersOut