Bicycle manufacturer Avanti proved critical in Huon Salmon-Genesys meeting a funding shortfall for the 2014 season and remaining afloat after the unexpected departure of title sponsor Huon Salmon.
It’s a business world out there and it’s got to be a working partnership. It’d be nice to keep a sponsor and a relationship forever, but after a while sponsors need change and invest in other things.
The team officially announced its rebranding Friday, changing its name to Avanti Pro Cycling for the 2014 season. But while Avanti’s investment has been welcomed by management, the circumstances of Huon Salmon’s decision to pull its funding very nearly brought the team to its knees.
Huon Salmon came on board for 2013, signing a contract with the team in late 2012 which was expected to run beyond the 2014 season. The aquaculture brand was, the team hoped, being positioned to fill the gulf expected to be left by long-time supporter Genesys - which had flagged its departure earlier in the year. After a successful association with the team for 2013, negotiations opened for a modest increase from Huon Salmon for the 2014 season midway through the year.
“They had been really happy with what we’d been doing,” said team co-owner Steve Price. “There had been a phenomenal amount of positive feedback to the television ad, which screened on SBS during the Tour de France, and we went back to them to discuss terms for 2014. It was all very positive.”
A ‘hand-shake’ agreement was reached, new contracts were drawn up, signed, and were sent to Huon Salmon for ratification by the board. That process was believed by Price to be a formality. It wasn’t. The company called Price to not only reverse the decision to up the team’s funding, but to also announce that it would be stepping away from the team altogether.
Price was told by Huon Salmon that the company was looking to pursue a different marketing direction for 2014, and that for the time being, that would mean stepping away from cycling. Cycling Central approached Huon Salmon for comment to clarify this. Gregg Flower the company's General Manager of Sales and Marketing sent the following statement.
"Although we had a strong desire to continue the relationship, in the short term it is not possible due to budget constraints and a refocusing of our marketing efforts. We’re hopeful that circumstances might change in future years to allow us to again support the team," Flower said.
The ad that screened on television during the Tour de France. (Supplied)
While there was no certainty offered by the "hand-shake" agreement, and Price understands the company's prerogative to go in a different direction, he was left disappointed by the timing of the decision which left him scrambling to keep the team afloat.
“They told me they were sorry,” said Price. “But I don’t think they understood how much trouble they had left us in. Every one of our athletes that had created the positive publicity they received for their brand this year, all those guys, their futures were at risk because of the decision. I wanted to make them aware of that, and the impact it was going to have on the team.”
Cycling Central understands the initial contract signed by both parties had mandated that in the case of a termination, at least 10 months notice would be required, to prevent the scramble Price had to through to replace Huon's investment on a razor-thin time-frame. Legally the team may have had a case, but had neither the time nor resources to pursue it.
Thankfully, Avanti, and to a lesser extent Shimano which will provide components and gear for the team in 2014, ending a seven year partnership with SRAM, came to the team’s aid. The bike manufacturer only came on board at the start of 2013, but was convinced by the team's success to up its investment with the team considerably for 2014. The budget, despite the Huon decision, will be “the same” as it was last season, Cycling Central understands.
“We look forward to moving on with Avanti, who’ve been really great in stepping up. We had thought Huon Salmon would have been with us longer than what they were, but things have changed in their business,” said team general manager Andrew Christie-Johnston.
“Huon felt their money is better spent outside of cycling, and that’s unfortunate. We had a great 12 months with them. It’s always disappointing to lose support from a company, particularly as we have some close friends within Huon. But that’s where we’re at.
“We always want to step up from year to year, and maybe down the road we can find another partner to help us along, but at the moment (the budget) is the same as it was for 2013.”
All teams face the same financial pressures
With four straight domestic series overall titles on the trot from the team, and a slew of riders graduating to the elite ranks of the sport, the WorldTour, Huon has been one of the success stories of Australian cycling. It’s been run for more than a decade now by Christie-Johnston and Price and is one of the most stable and financially prudent out there.
Even so, the Huon Salmon episode goes to the heart of the sport’s fragility, and demonstrates no team is insulated from financial trouble.
“It’s a business world out there and it’s got to be a working partnership. It’d be nice to keep a sponsor and a relationship forever, but after a while sponsors need change and invest in other things,” said Christie-Johnston.
“When Genesys (the team’s first major sponsor) came on board it was really just myself and Steve (Price) with our own money running the team. Their support allowed the project to evolve to something that we’re very proud of. Through the investment they put in the team there’s been a lot of riders who have left the team and have moved on to the WorldTour, without those sorts of sponsors we just can’t do that.”
Meanwhile with the addition of two new medical staff, and the recruitment of a performance manager the team is looking more professional than ever. The step to the ProConti level, first mooted this time last year remains the overarching goal, and the team looks closer than ever. Getting there however is now only a question of funding.
“We’re ready. The team structure is there. We’ve got a great bunch of people who have been involved with us for a long time now. And we’ve got some new guys involved with us this year," said Christie-Johnston.
“But we need to find that sponsor that wants to come along on the journey with us. We’re still actively pursuing that.
"We don't have a Michael Drapac or a Gerry Ryan, we need the funding in place before we can do anything. To get that we need the right partner, who shares our vision."
Disclosure: Cycling Central was accommodated in Launceston for a night by Huon Salmon-Genesys as part of the team’s recent pre-season camp.