I’M no economic expert. That’s probably why I find the following story about the price of football shirts so baffling.
In 2003, JJB Sports was one of several sports retail companies fined by the Office of Fair Trading for fixing the prices of replica football shirts.
The retailers in question were found to have agreed minimum prices for Umbro-made England and Manchester United shirts brought out between 1999 and 2002.
Such ‘price-fixing’ agreements, which are are against the law, kept the prices of the shirts artifically high.
JJB took their appeal against the fine all the way to the House of Lords – and lost, ending up with a £6.7m fine earlier this year.
Then consumer group Which? launched a legal action on behalf of supporters who paid up to £39.99 for shirts during three specific periods betwen April 2000 and August 2001 as a result of the price-fixing deal. That’s £39.99. Remember that figure; it will come in useful later.
That case was this week settled out of court, with JJB agreeing to give a £20 refund to the 600 people who joined Which? in its legal fight.
Those who did not join the fight can stil claim a £10 refund if they can provide either proof of purchase or the shirt itself – with label intact – at a JJB store before February 5, 2009.
In a statement, JJB said that in settling the action, it did not admit that any consumers suffered loss giving rise to an action for damages as a result of its words, actions or behaviour.
I can understand all of that. Price fixing, shirts costing too much, a large group of fans left feeling ripped off. That’s simple. What I don’t understand is this.
Today, I went into the JJB store on Merseyway, in Stockport. A medium-sized Manchester United replica shirt – the current one, made by Nike – sells at £39.99.
So even though there is no suggestion of a price-fixing deal now, a Manchester United replica shirt at JJB Sports costs exactly the same as it did just before the OFT got involved in 2003.
Which begs the question: Why was there any need for a price-fixing deal all those years ago?