In the past week, two high-profile, long-term commercial relationships have come to an end.
First came the announcement that the International Olympic Committee (“IOC”) and McDonald’s had mutually agreed to end their worldwide partnership with immediate effect, three years before it was due to expire (the commercial background to the break-up, and any financial terms which accompanied the termination, are not public knowledge). In some respects, this is the end of the Olympics as many of us know it: McDonald’s has been involved in some form of partnership with the Olympics for over 40 years (since the 1976 Innsbruck Winter Games) and was a founding member of the IOC’s TOP scheme (“The Olympic Partner” programme of exclusive global marketing rights relating to the Olympics) in 1985.
Less than a week later came the news that, after half a century of partnership, Adidas and Bundesliga side Schalke 04 will not be renewing their kit partnership beyond the 2017-18 season.
At the outset of any relationship, making detailed plans for the break-up often feels counterintuitive or even counterproductive. In those heady early days, it seems to make little sense to plan for the relationship’s ultimate demise (particularly where that involves considering the possibility that it might involve disagreement). Yet, regardless of whether the ending of such a relationship is mutual, it often pays to ensure that these matters are carefully thought through and set out with in the contract governing the relationship.
With news of these break-ups in the headlines, Sports Shorts looks at some of the key considerations upon ending a commercial relationship: