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A business mogul breaks down Michael Jordan's earnings per shoe from Nike

5% seems measly, but once you get into the numbers, it's the secret behind the most successful shoe deal in sports history.

Michael Jordan is easily one of the reasons why Nike rose into one of the most iconic brands in history. Those shoes coupled with his scintillating on-court performances generate millions and even billions of dollars for the shoe company every year. One might assume that Jordan has at least a double-digit percentage share of Nike’s revenues. The reality is that the Greatest of All Time gets 5% per shoe.

Highway robbery or fair?

Jordan signed with Nike in 1984. It was a five-year deal worth $500,000 per year. This was double the amount Adidas’ offered, the other shoe company that was Jordan’s first choice. Nike projected to sell $3 million worth of Air Jordans in three years. They completely missed the mark as they bagged a whopping $126 million in the first year alone.

According to Forbes, the Jordan Brand is estimated to be worth $10 billion. Interestingly, estimates reveal Jordan himself has made some $1.3 billion from the shoe that has his name on it over the last four decades. It is a relatively measly sum because the GOAT only gets five percent or $10 to $12 per shoe.

He gets 5% per shoe. Jordan is getting around 10-12 dollars per shoe and he is selling millions. That’s $150 million per year. That’s a lot of money and a lot of people were looking at it and they were like, 'Why is he getting only five percent?'” said Shawn Cotton, per Mogul State of Mind.

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He’s not making the shoe

One might feel that Jordan’s royalty checks should be more than $150 million a year. But Cotton, an experienced mogul, explains it in simple terms.

Well, he is not making the shoe. His name is on it. You know what I mean,” Cotton said.

Nike employs millions of shoemakers to craft Jordans. Apart from labor, there are millions of other costs incurred in the supply chain. Jordan does not worry about these expenses at all. These decisions are all up to the company.

Whether you agree with Cotton’s explanation or not, $150 million per year is good money. It’s been more than two decades since we last saw Jordan on the basketball court, but he’s still earning millions from basketball shoes. In 2019, Jordan bagged $130 million from the Jordan Brand, almost four times as LeBron James’ signature shoes.

Five percent seems a measly sum, but if you sell millions of shoes every year, then those things blow up. It’s amazing that Jordan played just 15 years in the league, but his impact was so massive that he’s never had to work a day in his life again. The lesson here is clear: it pays to be regarded as the greatest in your field. 

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