The commercial relationship between the National Basketball Association (NBA) and its players regarding officially licensed merchandise is structured such that individual players do not directly receive a percentage of jersey sales. Instead, revenue generated from the sales of jerseys and other licensed products is distributed according to collective bargaining agreements. These agreements outline how profits are allocated between the league and the players’ union, the National Basketball Players Association (NBPA). An example of licensed product would be a jersey bearing a player’s name and number sold through official NBA channels.
This revenue-sharing model is important because it ensures a consistent and predictable stream of income for both the league and its players. It benefits players indirectly through higher salary caps and increased overall revenue available for player compensation. Historically, the structure of these agreements has evolved through negotiations and renegotiations between the NBA and the NBPA, reflecting changes in the financial landscape of professional basketball and the relative bargaining power of each party.