UNLV, Nike come to terms on deal for shoes, apparel

For at least 25 years, UNLV has been a Nike school when it comes to men's basketball.

Now it's a Nike school in all sports.

The school signed two five-year contracts and one three-year deal with the famous shoemaker to handle its athletic apparel and shoe needs that is valued at $3 million over the course of the agreements.

UNLV's three-year deal covers men's basketball for $155,000 per year for a combined value of $465,000. The five-year contracts are for football ($230,000 annually, $1.15 million total) and all other sports ($277,000 and $1.385 million).

"We're extremely happy," UNLV athletic director Mike Hamrick said. "This is a great deal for our athletics program. It's significant for our student/athletes. They'll be wearing the best apparel available.

"Financially, it was significant."

Hamrick also said aligning with the Nike swoosh, which is so nationally recognizable and popular with college-aged athletes, was a major bonus.

"Branding was very important to me as to the direction that we went," Hamrick said. "Branding was one of the considerations along with, obviously, the dollar figure."

But Nike will not contribute money to UNLV, other than $75,000 annually to help pay men's basketball coach Lon Kruger's five-year, $5.2 million salary.

Instead, the contracted money serves as an open account for UNLV to purchase such items as football jerseys, tennis shoes and coaches' sideline golf shirts.

If the school goes over any of the contracted amounts, it receives a 10 percent discount to purchase any other items.

Under previous agreements with three separate companies, UNLV bought items at cost and did not have open accounts already provided. The Nike deals, Hamrick said, will provide substantial savings because that is money set aside rather than cash that comes out of the athletic department's coffers.

During the 2006-07 fiscal year, the school spent $247,777 on Nike, $117,518 on Russell Athletic and $93,000 on adidas.

Considering the dollar amounts of the new Nike contracts, a face-value look might make it seem as if UNLV will have spending money left over under the new arrangements.

But there are three reasons why Rebels athletics will need every penny -- and more.

UNLV will have to make a complete changeover in apparel not only for coaches and athletes but for equipment managers, team physicians and sports information personnel. Nike is giving a two-year grace period to change all practice apparel to its brand.

Also, Nike prices are higher. A Russell Athletic hooded sweatshirt that would cost $30 would go for $35 under the Nike label. Multiplied by 500, that's a $2,500 difference, and such an allowance was made when the contracts were signed.

"That was one of the concerns when it came down to looking at the proposals," UNLV equipment director Paul Pucciarelli said. "They might've both been exactly the same, but they really weren't because certain things are a little higher. So we had to do our due diligence."

Perhaps the most important difference is the previous agreements were at wholesale. The contracts with Nike are at retail, which is about 50 percent higher, and again an allowance was made when the deals were formed.

Though the temptation to go with Nike was great at the outset, UNLV did not make any snap decisions. Negotiations went back and forth for seven months before an agreement was finalized.

"I was pleased with the aggressiveness Nike took toward us," Hamrick said. "They wanted us."

The school did an extensive analysis of how much each item would cost and compared the companies. Hamrick and Pucciarelli did not identify what other companies UNLV negotiated with, but they said making sure the Olympic sports were taken care of as well as basketball and football was crucial.

"We went into the negotiations and looking at these contracts with our eyes wide open," Pucciarelli said. "We just didn't drink the Kool-Aid and go, 'We've got to have Nike.' That's not what it was all about."

Contact reporter Mark Anderson at manderson@reviewjournal.com or (702) 387-2914.