Tag Archives: Mary Portas

‘Market Matters’ – September 2018

Buying companies as a going concern is fun. Sometimes. Despite purchasers’ best efforts when sniffing around accounts, staff contracts, order book, supply contracts and other ‘due diligence’ they inevitably spend a couple of years digging up buried bodies:‘ Oh sorry, didn’t you know the HQ is built over an old mineshaft? Well tough luck – the legal concept of ‘caveat emptor’ applies. In other words ‘buyer beware’ or ‘tough luck – you should have asked the locals’.  

One of the biggest liabilities for a purchaser is often staff pensions.

One of the biggest liabilities for a purchaser is often staff pensions. Hence the unholy row when Sir Philip Green’s Arcadia Group sold BHS for £1 complete with a large hole in it’s staff pension fund. Then BHS went bust. Valuation theory says the price paid by a purchaser reflects the liabilities it has assumed and the seller is home and dry now someone else is carrying the can. That’s the theory, but life is more complicated than that.

Mike Ashley is arguably the best corporate retailer of his generation

The Chinese have a saying: ‘The best time to collect firewood is after a storm’ i.e. timing is everything. Mike Ashley, billionaire owner of Sports Direct is an expert at timing. He bought the 59-store House of Fraser chain for £90m hours after it went into receivership thus avoiding liability for the staff pension fund and £70m of unpaid bills owed to suppliers. This was his latest strategic bet at buying financially-distressed retailers. Since he founded Sports Direct in 1982 he’s never been able to resist a bargain. He bought heritage brands Karrimor, Lonsdale and Everlast to promote as own-label merchandise then sold-on Dunlop to the Japanese for a tidy profit.  Mike Ashley is arguably the best corporate retailer of his generation – a successor to Ralph Halpern of Burtons and Sir Philip Green of Arcadia.

 Mike hasn’t got a gong (yet)

Just like them he is famously combative. He refused to appear in front of a Parliamentary inquiry to answer questions about working practices at his distribution warehouses. After arm-twisting with threats of gaol in the Tower of London he did appear but unlike Philip Green he didn’t call for the resignation of Frank Field MP, Chairman of the ‘biased’ Work and Pensions select committee. As Mike hasn’t got a gong (yet) there was no kickback from the Commons Forfeiture Committee to have his knighthood annulled.

Frank Field MP is one of the most experienced and widely-respected members of Parliament

Frank Field MP is one of the most experienced and widely-respected members of Parliament and doesn’t want another public inquiry punch-up. He politely suggested this is an opportunity for the new House of Fraser owner to cover himself in glory. ‘Mike Ashley should take responsibility for the pension scheme’said Mr Field. ‘It is in surplus and…he would be smelling of roses compared to his rivals on the High Street.’ That was one way to offer unwanted advice and twist the knife in Sir Philip at the same time – despite Philip’s voluntary donation of £360m to the BHS pension scheme. Sir Vince Cable, LibDem leader and former business secretary was worried the Government Pension Protection Scheme will have to fund another bail-out.He proposed administrators be made to report on large deals e.g. House of Fraser to MPs. ‘The danger is an agreement which is reached is unfair to one or other parties. It could be the unsecured creditors like the suppliers, or it could be the taxman, or in this case there are worries that it’s unfair to the pensioners’. Quite so – but what reporting to MP’s would achieve is unclear.

‘The new Harrods of the High Street’

Many High Street Landlords had been terrified at the thought of business rates on empty properties and lost rent with H of F closing down. They breathed a collective sigh of relief at the buy-out then cracked open another Bollinger when Mike announced he would create ‘the new Harrods of the High Street’. Ashley certainly has the financial muscle to do so but has left staff and suppliers wondering if it will be at their cost. Wholesale suppliers only get paid after goods are delivered and there is – allegedly – £70m owing to them and sales floor concession-holders are only paid after goods are bought by customers. Albert Arkwright, nice but rather dim leader of Mudford-on-Sea Council said: ‘Phew that’s a relief – for a moment I thought our Mudford store might be for the chop…’

Other troubled retailers are worrying about a potential takeover

Other troubled retailers are worrying about a potential takeover, particularly those in whom Ashley holds a stake e.g. Debenhams. He has a 29% holding in the chain and their credit rating was downgraded last month when credit insurer Euler Hermes reportedly reduced cover at concerns over inability to pay bills in full and on time. Debs are holding redundancy talks with staff whilst Chief Exec. Sergio Bucher attempts to secure £10m of cost savings this financial year and double that each year in the future.

Mary Portas, business commentator and so-called ‘Queen of Shops’ has relaunched her retail consultancy service

Meanwhile Mary Portas, business commentator and so-called ‘Queen of Shops’ has relaunched her retail consultancy service by affirming her belief in SME’s (Small and Medium-sized Enterprises) at ‘Business Spotlight’ sessions sponsored byNatWest Bank.

‘British means well-designed and well-made. China is desperate to achieve that recognition but ‘made in China’ just doesn’t cut it’.

La Portas suggested a new breed of boss is emerging; one who is more fun, more thoughtful and freer of the old hierarchies which hold back innovation. And they’re not worried about Brexit because there is ‘huge equity and power in the British brand. British means well-designed and well-made. China is desperate to achieve that recognition but ‘made in China’ just doesn’t cut it’. But she also said the Government should be doing much more to help small businesses export their goods and servicesShe also encouraged Local Authorities to support the ‘tide of innovative and creative new enterprise’ by building cheaper operating spaces in towns and cities. ‘I wish the Government would support them by building bricks and mortar spaces’ she said. Maybe she had overlooked Market Halls.

‘Any brand that connects with women in a deep and meaningful way is going to win’ 

Mary suggested British businesses are strong innovators in food, wellbeing, health and beauty.‘Anything that makes us feel and look better’ she said. More should be be done to sell to the female half of the population. ‘Any brand that connects with women in a deep and meaningful way is going to win’ she opined. Future businesses will be more inventive, more principled and less restricted than those of today. ‘I just wish I could be around in 50 years’ time to see it all happen’ she said.

Mary who…?’

When asked to comment, Mike Ashley reportedly said:‘Mary who…?’

‘Market Matters’ – August 2018

Consider the UK’s High Streets. Hard on the heels of House of Fraser’s announcement of dozens of closures and the rumours about Debenhams you could almost forget how long they’ve been a bad news story. It was back in 2012 the penny finally dropped they were in trouble and it couldn’t be blamed on the 2008 banking collapse or the previous Labour government. Grant Shapps MP, the keen young DCLG Housing and Local Government minister launched the ‘Portas pilot towns’ competition backed by David Cameron and Mary Portas banging on about Markets as the saviour of High Streets. But what happened then? Not much. The money and policy initiatives fizzled out as attention shifted to Brexit and Cameron and Shapps disappeared faster than a Blockbuster store.

The traditional heart of a town survives despite the oversupply of ‘Bricks ‘n Mortar’ retail and Landlords bleeding to death on empty rates.

And yet somehow the High Street still staggers along. The traditional heart of a town survives despite the oversupply of ‘Bricks ‘n Mortar’ retail and Landlords bleeding to death on empty rates. Here are a few Losers, Movers and Bruisers we’ve seen over the last few years….

The Losers:

Woolworths: Founded in 1909, 830 UK stores in 1995 then administration in 2008. What happened?

Our Price: Crashed out of Vinyl, DVD’s and Cassettes in 2004 thanks to online streaming. At about the same time Radio Rentals (remember them?) finally threw in the towel, followed by Blockbuster Video in 2013.

British Home Stores: Closed it’s 160 stores in 2016 amidst allegations that owner Philip Green starved it and the staff pension fund of investment. Well over half the former BHS stores still remain empty today.

Poundland: Owned by South African retail giant Steinhoff with 700 stores, many being former Woolworths units. Currently involved in a major accounting scandal – rather like Tesco 18 months ago.

New Look, Carpetright, Monsoon and Mothercare: planned closures announced.

The Movers:

Marks & Spencer: 280 stores in 1997 and now over 1,000 – shifted from fashions and clothing to luxury foods at edge of town locations.

Argos: 380 stores in 1996, now some 850 mainly at edge of town and retail park locations. Bought by Sainsbury and central to the Asda merger because of their excellent distribution network.

Currys/PC World/Carphone Warehouse: Merged then downsized and bailed out of the High Street to retail parks where they’re doing OK. Mind you Carphone Warehouse on the High Street is having a rough time with 100 closures expected.

Boots Chemists: More than doubled their town centre outlets from 1,000 in 1995 to 2,500 today by adding another 1,500 edge of towners.

The Bruisers:

Charity shops: over 11,000 in the UK at the last count. Welcomed with open arms by High Street Landlords desperate to avoid empty rates liability.

Coffee shops: Costa now have 2,200 stores across the UK. Don’t mention Starbucks, Vat and Corporation tax in the same sentence.

BooHoo: Doing very nicely online thank you amongst 16-30 year-olds thanks to no business rates and ‘Bricks ‘n Mortar’ overheadsA fine example of how to target a specific consumer group and their lifestyle.  

Mergers, consolidation, moving online and relocating to the edge of town is THE pattern

What this shows is just how little sentiment there is amongst the big boys. Mergers, consolidation, moving online and relocating to the edge of town is THE pattern. According to the Centre for Retail Research the number of online retail sales as a proportion of total retail sales has risen from 2.5% in 2004 to 22% in 2018. That is a simply staggering growth rate and any retailer who ignores the trend is dead in the water.

So who will replace multiples on the High Street?

So who will replace multiples on the High Street? The Centre for Retail Research says don’t despair – it will become a social centre. It will shift from commerce to leisure with more space given over to restaurants, ‘artisan’ foodstores, health & beauty and ‘lifestyle’ outlets. Less errr…’glamorous’ locations such as Mudford-on-Sea will have to make do with Charity shops, bookmakers and vape stores. ‘Lifestyle’ retailers such as Joules and Ted Baker are doing well, but only in top 100 towns. Future casualties will to be shoes, household goods, furniture, textiles and music/games. Those offers are increasingly replaced with Amazon collection boxes.

E-commerce is like one of those creepy robot lawnmowers

The CRR also highlighted the rise in ‘Showroom’ and ‘Concept’ stores. These are sparsely-staffed display units which allow Customers a hands-on experience but retain the cost advantage of selling online. E-commerce is like one of those creepy robot lawnmowers – it works for you 24/7 whatever the weather and if you’re a home producer selling on Ebay or Etsy gives you a physical showcase for your products.

Dyson have just launched an Oxford Street demonstration store where you can test drive their vacuum cleaners and hairdryers, helped by charming young men who can’t do enough for their lady customers – or for the men either come to think of it. Note the cunning combination of hairstylist and vacuum cleaner salesperson. Wow.      

You can’t underestimate how activity stimulates confidence

To attract leisure-users and investment High Streets need to differentiate– offer something which makes them more attractive than the High Street in the next town. The easy fix is to spend zillions on repaving and relighting but to my mind it is better to spend it encouraging small businesses. More rent and rates caps, pop-up shops in empty units, Town Council and landlord partnerships, events and Markets. You can’t underestimate how activity stimulates confidence. There are some towns where an energetic and innovative B.I.D or Town Centre Partnership is really making a difference.

Don’t feel you need to spend zillions on retail demand surveys

And finally, if you are a B.I.D. don’t feel you need to spend zillions on retail demand surveys. Henry Ford, the mastermind behind mass-produced automobiles was once asked what he thought about Customer research. He replied: “If I’d asked the public what they wanted they’d have said faster horses….’




News-Mary Portas Report

Following December’s publication of Mary Portas’ ‘Review into the future of our High Streets’ the Government was remarkably quick off the mark implementing one of her key recommendations – establishing pilot ‘Town Team’ schemes. A formal response to all 28 recommendations is due soon but in the meantime Grant Shapps, Minister for Housing and Local Government at the DCLG unexpectedly stumped up enough cash for a competition to select 12 pilot towns, with each being given some £100,000 of funding to test the ‘proof of concept’.

For our High Streets to survive they need to offer something new and exciting.

On 4th February he announced the competition on YouTube (no less) from Hatfield Town Centre.’Our High streets have faced stiff competition from Internet shopping and out-of-town shopping’ he declared, in front of a very unexciting High Street. ‘We are leaving them underused, unloved and under-valued. The internet is not going to go away and so for our High Streets to survive they need to offer something new and exciting’.

Was there a note of nervousness in his voice? Maybe, as he might have been warned about redheads by his mother. In any event Ms Portas was in like Flynn with her response: ‘I hope my Review has inspired people with another vision of tomorrow where our High Streets are re-imagined as destinations for socializing, culture, well being and learning as well as shopping. I want the first twelve Town Teams to challenge the old ways of working, experiment, take risks and reaffirm their place at the heart of a community. A place we all want to be and can be proud of’.

Online sales were creating High Street vacancies long before the recession.

The Portas review is a good read and highlights the internet opportunities and challenges for retailers both large and small. It shows how online sales were creating High Street vacancies long before the recession bit. As Sir Philip Green of Arcadia Group said: ‘Why carry a High Street rent when it’s easier to increase sales online?’ Portas demonstrates how the growth of internet sales is affecting multiple and independent retailers alike, hence the demise of Woolworths. The report recommends Town Teams of local businesses to manage their High Street like a business, just like the big boys do with their Shopping Centres.

Embracing a willingness to adopt technology recommended by the Portas report the DCLG competition is staged and run entirely online. It was only announced on 4th February and entries must be submitted by 30th March. That’s not much time to prepare an entry but as Scary Mary says, speed of response is vital to successful retailers. All entries need to be accompanied by a video posted on YouTube showing why this entry is down on the streets wiv the kids, innit?

Entries can be lodged by anyone interested in the future of their High Street, not just the local Council. Local partnerships of investors and landlords have as much chance as stallholders or retailers but strong leadership is expected. The entry forms are very simple and applicants are expected to describe their vision, the potential for improving their High Street and their priorities. £1,000,000 of prize money is a cheap way to market-test the reports recommendations and find new ideas to be rolled-out across the nation. If you’ve not yet read the report download it from


and the application form from


The problem with reports like this is the devil hides in the detail. Some recommendations are very relevant to Markets e.g. a new ‘National Market Day’ when anyone could try their hand at being a trader or removing regulations to allow anyone to trade on the High Street. It includes a recommendation small businesses (presumably including indoor stalls) are offered concessions on their business rates – but the devil is in the detail of implementation. There’s no mention of awkward issues like Market Charters and pedlars licenses and I’d be happier if the legality of individual stall assessments was challenged before giving concessions. But putting the detail to one side for a moment the real value of the report is the debate it stimulates and the reaction of government.

Some 5,268 shops were closed by major retailers in 2011 whilst only 5,094 opened.

The continuing slide of the High Street was confirmed last month by insolvency specialists PriceWaterhouse Coopers. Some 5,268 shops were closed by major retailers in 2011 whilst only 5,094 opened. Bookshops, electrical and home-furnishing retailers were the worst hit with pawnbrokers, credit unions and pound shops taking up some of the slack. As Mike Jervis of PwC said: ‘Electricals and bookshops have suffered as these are now increasingly bought online, but retailers in this sector are typically carrying unnecessarily large property portfolios.’ So there.

The Portas report contains a cartoon of the High Street featuring a prominent Market with smiley customers. I hope your Council got the message and is entering the Town Team competition. If not, there’s still time for you to front it up using your Market as a focus for ‘socializing, culture, well being and learning – as well as shopping’. You may only have 4 weeks to embrace change, but it’s possible.

Good luck.


News-Mary Portas 710 x 470

I’m no great fan of TV’s ‘Mary, Queen of Shops’ but I have to say last month’s report by Mary Portas into ‘The Future of our High Streets’ is a good read. She might be a bit too quick jumping onto a passing bandwagon for everyone’s tastes, but isn’t that what retailing is all about? At the start of 2011 MP was invited by the PM to suggest a cure for the UK’s declining High Streets. She published her report in December which can now be downloaded from www.maryportas.com. It contains some uncomfortable reading for retail businesses both large and small:

‘Expectations have been raised in terms of value and service which the average high street has simply failed to deliver. During the boom years many extremely mediocre businesses survived and flourished – Woolworths is a prime example’. Ouch.

There are thousands of businesses in Britain who once managed to make a living out of retail but have simply failed to adapt.

She goes on to criticise unimaginative retailers who might know their product inside-out but are simply no good at running a business.

‘There are thousands of businesses in Britain who once managed to make a living out of retail but have simply failed to adapt. Hard-working, committed and professional people, frequently real experts in their fields who haven’t adapted their retail offer to meet the increasingly-demanding expectations of todays consumer. In a world where the sheer sophistication, speed and scale of the web and major supermarkets will always be pushing new boundaries you’ll never be able to compete with the range and diversity of the major multiples’.

There is no point in going head to head with a supermarket chain.

At this point a few of us might start to feel a bit uncomfortable but I have to say she’s on the right track – there’s very little room for sentiment in retailing where you either Do or Die. I also agree there’s no point in going head to head with a supermarket chain – better to box clever and specialise. She points out the phenomenal growth of online sales is as great a threat to multiple retailers as independents so demand for High Street shops was already drying-up before the recession hit. As Sir Philip Green of Arcadia Group says: Why carry the burden of a High Street rent when you can increase profits by selling online? Although rents are (believe it or not) still cheap on markets there are still too few businesses promoting themselves via the web and treating their stall as a ‘showcase’ while making core profits on the internet.

Online sales are growing at 10% per annum and set to increase.

MP also has a good poke at landlords and local government for allowing charity shops to take over High Streets and withholding business rates concessions that encourage occupancy. She advocates ‘Town Teams’ comprised of local stakeholders – retailers, landlords and residents, who would run the High Street as a business (just like their out-of-town and shopping centre competitors). She is dismissive of existing Town Centre Managers who have ‘varying powers and responsibilities with little retail or consumer knowledge’ – well maybe, but whether the town Teams are intended to replace or be piggy-backed onto existing Business Improvement Districts is unclear, as is how they are financed.

The report is a good read but some of her ideas ring a loud alarm bell in my head – relaxation of the Use Classes regulations for instance. The need to obtain planning consent to change from one retail use to another was introduced to give local Councils control over the type of shops on their High Street. A Council, like a good market manager knows how important it is to encourage competition and variety but a manager can apply his own informal version: ‘Sorry mate but we’re full up with mobile phones already’. Removing use classes control on the High Street would simply see the remaining few independents displaced by multiple-owned convenience stores fighting for market share – or fast food takeaways or charity shops. The problem is not the system but the lack of determination with which it is enforced. Maybe the Town Team can do that.

The Portas report is a great contrast to another long-awaited published in December – Lord Turner’s report into the managerial ineptitude of the Financial Services Authority which allowed the Royal Bank of Scotland to collapse. After all, it only cost the British taxpayer some £45 billion of bail-out. Hardly worth mentioning really…

In 500 pages of technical explanation of how and where it all went wrong I didn’t see anyone say ‘I’m sorry – we screwed up’ or better still – ‘We did screw up but the people responsible have been sacked and prosecuted.’ Instead the former Chief Executive, Hector Sants is now deputy governor of the bank of England. Thanks heavens for that – we’re finally safe from the Eurozone crisis. Negligent directors of private companies get sued and barred from further office but government bodies use the Charge of the Light Brigade excuse coined by Sir Humphrey in Yes, Minister: ‘This was a most unfortunate clerical error…’

On an equally sad note I’m sorry to bid farewell this month to Peter Naylor – long-suffering editor of ‘Market Trade News’. Widely-respected throughout the publishing industry for his ruthless determination to stamp out split infinitives and incorrectly-placed commas his editorial talents are only matched by his story-telling skills. His tales of monster salmon which have eluded him on the North Esk may get taller each year but I have to admit he is a bloody good fisherman. Tight lines in your retirement Peter!