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Here’s How Much Adidas Will Save By Not Paying Kanye Royalty Fees for Yeezy Brand

While Adidas is losing billions by severing its hugely successful partnership with Kaye West, the company is looking to save a fortune in royalty fees it had to pay the former billionaire.

NEW YORK, NEW YORK – NOVEMBER 07: Kanye West speaks on stage at the “Kanye West and Steven Smith in Conversation with Mark Wilson” at the on November 07, 2019 in New York City. (Photo by Brad Barket/Getty Images for Fast Company)

The company recently announced plans to continue to produce West’s conceptualized Yeezy shoes without his branding association since the retail giant claims it owns all Yeezy line design rights for both existing and future colors and versions. By cutting out West and selling the sneakers under its own branding, the company will save about $300 million in royalty payments and marketing fees annually, CNN reported.

Rebranding Plan

The rebranding, in effect, means that the sports apparel brand does not owe Kanye billionaire royalties, according to Bloomberg’s reporting regarding the details of West’s contract. He might get a smaller fee, sources told TMZ.

“Going forward, we will leverage the existing inventory with the exact plans being developed as we speak,” announced Adidas finance chief Harm Ohlmeyer.

Adidas owns more than 160 trademark applications and registrations for its Yeezy brand, so the company could simply remove the Yeezy branding. 

This also means the popular Yeezy 350 V2, a signature pair of Adidas that rivals NIKE’s Air Jordan 1, will have its name changed and its packaging slightly altered, moving forward in 2023.

The only exception to the rebranding is Yeezy Slides, which the rapper owns.

Adidas Trending

The reported 2023 rebranding plan trended on social media, with some users and fans, including Los Angeles Rams cornerback Jalen Ramsey, publicly denouncing the company’s decision to sell Yeezy-designed sneakers without the man who spearheaded its development.

“If you don’t rock wit (sic) somebody, why would you still use they (sic) designs!?” Ramsey asked on Instagram.

Some are even charging that Adidas is stealing from West and that the company’s rebranded product would be “fake Yeezy” shoes.

What Ending West Deal Cost

Adidas, according to the company itself, expects to lose more than $246 million in profit at the end of 2022, because of the severed partnership that came about due to West making anti-Semitic statements online and in interviews. 

“As publicly communicated on October 25, we had terminated the partnership with Ye immediately, ended production of Yeezy branded products and stopped all payments to Ye and his companies,” Ohlmeyer said in a Nov. 9 earnings call

As Finurah previously reported, the rapper claims that his anti-Semitic and anti-Black Live Matter rants have caused him to lose “$2 billion in one day.”

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