Interview

The summer of football begins next week with the opening match of the men's World Cup, held in the US, Canada, and Mexico. US sportswear brand Capelli Sport will also be participating, equipping the national team of Cape Verde and distributing licensed products from the Fédération Internationale de Football Association (FIFA).

In Europe, the team sport specialist is primarily known for its partnerships with clubs such as VfL Osnabrück, Grasshopper Club Zürich, and Sheffield FC. Capelli Sport has been based for over ten years with its European headquarters in Ratingen, North Rhine-Westphalia, near Düsseldorf, in a major football hub.

In this interview, Mourheg discusses the company's expectations for the tournament, current business performance, and the markets Capelli Sport plans to expand into.

Capelli Sport unterstützt die Nationalmannschaft von Kap Verde — Capelli Sport supports the Cape Verde national team *Credits: Capelli Sport*

World Cup is approaching. What are your expectations for the tournament?

The tournament is particularly interesting for us for several reasons, especially because it is taking place on our doorstep. Our parent company is based in the US, with headquarters in New York City and New Jersey, and our distribution centre is just five minutes from the MetLife Stadium, where the final will be held.

This is an extremely important event for the market there. We are already the market leader in US amateur football; everything below Major League Soccer (MLS) is our core business. When a mega-event comes to the country, it boosts the entire sport. For us as the market leader, this means a noticeable push in revenue, player numbers, and membership growth, and new football clubs are formed. That is why we definitely want to be involved, with at least one nation on the pitch.

Do you have a rough idea of the revenue boost the tournament will bring?

It depends on how many of our existing clubs benefit and how many new clubs approach us. Historically, the entire market's focus shifts heavily towards football during such periods.

The host nation's performance also plays a role; if they are eliminated in the group stage, the effect quickly dissipates. In the US, one mega-event follows another seamlessly. It would therefore be beneficial for the sport if the US team progresses as far as possible. We anticipate a short-term increase of up to 10 percent in US youth football. Furthermore, World Cup years are generally growth years for sports brands. Since we serve the team sports market directly, bypassing retail, we feel such developments immediately within the current year.

How has the first half of the year been for you, both globally and in Europe?

Good. The Cape Verde partnership alone, announced this half-year, has automatically generated a lot of interest. Considering how few brands besides the three major players are represented at a World Cup, it is really just a handful. This helps us enormously, including in direct conversations with clubs. We also had other strong areas: lacrosse and field hockey, with the latter becoming increasingly active with the upcoming European Championship. Overall, it has been an eventful first half.

Can you comment on revenue development?

Not yet definitively. It is a very seasonal business, and a lot still happens over the course of the year. We are not a brand that waits for pre-order rounds. Since we serve the team sports market directly, our revenue developments are more immediate. When the season starts, we see what the year has brought. Other brands have long since closed their order books and can do little to change things for this year. Our cycle is different; there is still a lot of movement.

Capelli Sports Empire-Linie — Capelli Sport's Empire line *Credits: Capelli Sport*

Besides the sportswear segment, you are also responsible for Capelli New York. Do you notice differences between the two areas given the current consumer sentiment?

Yes, definitely. The sports industry is developing differently from fashion. In the fashion and accessories sector, we are heavily dependent on general consumer sentiment and even the weather. If people shop less, it is immediately reflected. In team sports, however, the business is more stable. As long as the ball is rolling, there is momentum, relatively independent of the weather. There are more relevant cycles about the World Cup schedule, mega-events, or the sporting success of a national team.

How large is Capelli Sport in relation to the fashion division?

The sports brand is clearly the group's major growth sector. The fashion accessories business, primarily under Capelli New York, has existed since the company was founded 36 years ago. We are the market leader there, generating around 300 million in revenue. The growth potential in this segment is largely exhausted.

In sports, however, we have enormous growth rates. The brand has been around for 12 years, and we are now the market leader in US youth and amateur football, generating around 85 million in revenue worldwide. This is more than some long-established brands in Germany have achieved after over 100 years. Therefore, the balance between the two divisions at the group level is shifting rapidly. The focus is clearly on the sports brand.

How does this differ in Europe?

In Europe, the ratio is more balanced; we have been active here with the fashion division for 26 years. The revenue split between sports and fashion is approximately 50-50.

How are the sales channels structured?

In the fashion sector, it is a classic wholesale business. More importantly, we market our brand on our own self-managed spaces in large department stores without our own staff but with our own brand presence. We are present in stores like Galeria and P&C, among others. This is complemented by white-label production for large retailers and private label listings.

In the sports segment, direct sales is the core business. Our own sales team sells directly to clubs,...

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