Who is Philip Green?
Philip Green is a British billionaire businessman who owns some of the United Kingdom's largest retailers, including the Arcadia Group.
The Rise of Philip Green - (The story)
He rattled through the early stuff. Born 1952. Croydon (in case his accent doesn't give him away). Went to boarding school in Berkshire, aged eight. Nothing wrong with that; gives a boy independence and, no, he wouldn't send his own kids away to school. Because he wants them at home, that's why. Left at 15. Parents in business. Garages, electrical shops, property. His heart wasn't in it till he got to the bit about half a crown. When he was 12, his father died. His mum carried on the businesses. "She's a go-getter," he said. "Still is. Ring her up and she's on the other line to her solicitor, telling him do this, do that. She's still got the properties she had 45 years ago. Still does all her own books at 85 years of age." Anyway, back then, she let him help out in the shops and garages. She opened a self-service petrol station and he'd work in the forecourt on weekends and school holidays. Wipe windscreens, change oil, that sort of thing. The punters would tip him, sixpence, two bob, half a crown. "Half a crown," he said with a nostalgic smile. "Remember them? Nice heavy coin, that." Saturdays he could knock up as much as five pounds. Pocket money? What's pocket money? Having money given to you? No way. He earned what he got. At school there were two sorts of boys: those who wanted to stay on and those who wanted to get away. Simple as. He was the second kind. Things have changed, we're in different times now, light years away. Education's high up on the agenda, you know? Everybody pushing to get their kids in university. Living standards have changed, values have changed, the value of money has changed. "You look round and say to yourself, whoooosh, the last 10 years just flashed by. And you remember what half a crown used to mean."
Philip Green got his wish and went out to work when he was 16. "Obviously," he said, "I was never going to be a scholar." He laid an emphasis on the "obviously" that is both pre-emptive and pragmatic. It tells you he finds nothing wrong with book-learning, but it was not for him, and if you imagine that makes him a dunce, you've got another think coming. While others chose to sit in classrooms being told what to think and how to pass exams, he was out in the real world with the grown-ups, observing how many beans make five. For five formative years he learned the ropes of shoe retailing, importing and so forth, starting with filing and warehouse work and trotting samples to salesmen, until what he didn't know about shoes wasn't worth knowing.
"They were what you might call old money shoes. One-ninety nine, two-ninety nine, mostly imported from China and Taiwan. We were one of the first to do business in the far east. Eventually, after about four years, I was allowed to sell. Talk about how things have changed! In those days, they used to set up in hotels. This was in the Mount Royal Hotel, above the Cumberland. All the importers and buyers would check in for the annual shoe exhibitions. I was standing there and this guy came in and picked up one of our shoes. Well, it was a clog, really, like a Scholl with a bit of a heel and a leather strip over the top. Liked it. How much is it? I said one ninety-nine. What's the price of 40,000 pairs? I said I'd look into it, belted over to the boss. Which is he? I pointed him out. No, he said, he's got long hair, he can't be serious. I knew the guy came from a big group so I said, right, I'm going to get that order. He bet me five pounds that I couldn't and gave me a deadline. So off I went. They wanted them wrapped in a special way, special box, special this, special that, what didn't they want. I said yes, yes, I'd see to all that, and the weeks went by and the deadline was coming up, so I'm chasing, chasing, dadadada, and I get the order, on the nail. I ran all the way up the five flights, up to the top of our building, slapped it down, said there's your order. And he got this old-fashioned leather wallet out of his back pocket, and every note was like it had been ironed. Got the note out, feeling it to make sure it was just the one and handed me the five quid. That was my first order. Anyway, eight weeks later there had been so much aggravation about what they wanted and didn't want, the whole thing got cancelled. So he called me and said, when you're passing, call in and give me my fiver back. Still, he trained me up ..."
By the time Green was 23, he reckoned he was ready to strike out on his own. He took himself to Hong Kong and got the lie of the land. The principle, he reasoned, was the same - he would just deal in jeans instead of shoes. "That's how I started," he said, somewhat portentously. "Importing jeans."
It was risky, but I thought it was time to speak up for the wet liberals of this world. "Sweat shops," I ventured. "Exploiting the poor," and waited to be thrown out on to Oxford Street.
He paused a couple of seconds. "Have you ever been to Hong Kong?" he said. "No, I didn't think so. It's very fast moving, Hong Kong. Very fast. Very quick. Nobody goes to sleep. They work 17 hours a day and nobody's tired. Hong Kong. Very built up. You wouldn't imagine it. Every inch built up, cram full of people. All working. What's your definition of exploitation? Would you go out and pay twice as much for something you could get three doors away at half the price? What Hong Kong and Taiwan were then, the whole of China is today, and China is the fastest growing country in the world. They've got the endeavour. That's why. Is that exploitation, using the workforce of a billion people who want to make produce for the rest of the world? Now we have Vietnam and eastern Europe. I've just helped one of my suppliers build a factory in Vietnam. So what are we doing, are we providing the expertise in these places to help people work or are we exploiting them? It's a marketplace," he said, emphatically, as though I had thought it was a holiday camp, "and I'm concerned to buy the best products I can in the marketplace we're in. We're not looking to exploit, but we are looking to be quick on our feet." He looked about himself for inspiration to clinch his argument, picked up a small bottle of mineral water (in Arcadia, everyone seems to be sip-sip-sipping mineral water all day long) and declared, "If someone offered me 50,000 bottles of this at the right price, I'd buy them. I'd buy anything. Old stocks, discontinued lines, cancelled orders. At the right price. Now let's get on or we'll be here all day."
Which brings us to 1979, 25 years ago this very month. Green heard tell of 10 designer gear outlets going out of business. The stock was up for grabs. Thirty-five grand's worth at retail. In like Flynn. "I'll give you Xp in the pound," he said. "Deliver it to my warehouse." Then he went to have a look at it. "It didn't look all that bad to me," he said, "so I sent it all to the dry cleaners, got it put on nice satin hangers and polythened it up so it looked brand new. Then I thought, why sell it on for a few quid more? Sammy Stewart was retiring, I heard, so I bought his place off him. 41 Conduit Street. Did rather well ..."
Now it's 1981. He bought the place in Bond Street. "I buy companies like this," he said. And spares no detail. "I went to see this guy, Friday afternoon. Said I understand you want to sell your shop. He said, er, well, yes. I said what you want for it? He said 75 grand. I said Monday morning. Boom-boom - 75 for his lease, 75 for his stock, sight unseen. Go round Monday afternoon, exchange contracts. Then the phone rings. Guy says he understands my shop's for sale. I say he's made a mistake. Then some other guy phones up. I said not interested. Keeps ringing. Right? Seven and a half grand deposit at this point. I say, 'You want to give me 250 grand for it tomorrow afternoon, you can buy it. Take your client round to my lawyer.' So he did, he bought it. But, I said, you can't have it for six weeks. Done. Boom-boom.
"Next morning we're up and running. I only opened the shop in the evenings. Five till eight. By appointment. When people think ... hmmm? They come along. I got my money back within a week. Sold the lot. So I phoned this bloke I bought it off - nice man - and said, have you got any more stock? And he said come to Milan. So I chartered a plane. Leather goods. Some of these designers, they've got stock for years. Warehouses big as old aeroplane hangars, full of it. I said how many pieces are there. He said 20,000. I bought the lot. Must have shipped four, five trailers. We filled this shop, floor to ceiling, put up these great big posters and had them queueing all down Bond Street. Wasn't popular with the rest of the street, but what could they do?"
But this was small beer. The preface to a major hurricane. The tension is building for the big one. Philip Green extracts another long, thin fag from the packet marked Fumer Tue and prepares to enjoy himself. How he made his first million.
"Guy comes to see me, Thursday morning. He's got an import business. Jeans. Gone broke, receivers in, dadadada. He's owed a million quid. Got about 400,000 pairs of jeans. Wants 935 grand. I called my bank, said it's got to be done tomorrow night. Next day they say OK. I say good, we've got to get to Bristol, pick you up at four. Chartered a helicopter. Off we go, banker, lawyer and me. Spend all night negotiating to buy this company. Five in the morning, one point one million, all done. Not allowed to start the helicopter up after that. Too noisy that time of the morning. Middle of nowhere, pitch black, police car comes by, gives us a lift to the train station, quick kip on a bench, caught the milk train back to London.
"Monday morning we're up and running. We'd bought various people who owed money, so we go and see one of them. In Devon, it was. Said we'd like to collect our 250,000 quid. We had a little debate and he signed 10 postdated cheques. As we're leaving, he said, just en passant, he wished he could sell his business in three days flat. I didn't even know what he did. Found out, called him up next morning. Said was that a joke? Went to see him in Slough. Big building. He had 65 shops, concessions at Debenhams. He wanted four million quid. Have a look at his books. Didn't seem to add up right. Got my accountant to do a bit of a recce. Turned out he owed the bank three and a half million and his suppliers three and a half million. He's bankrupt. They're losing 70,000 a week. Can't pay the staff. Call him up on the Tuesday, say there's good news and there's bad news. The good news is I'll buy it. The bad news is you're broke. Said I'd take an option for 65,000 followed by another 435 if I get round the bend in six months. He said we're done," and Green is barely pausing for breath.
"I went to see the bank, said the business is broke but I think I can fix it. I'll give you 100,000 as a gesture of goodwill towards your three and a half million if you freeze the debt for six months. Done. Then I had a look at the business. I could see what had happened. The usual. Same issues you see today. Bad buying, no discipline, no control, old stock, indecision, time-wasting, corporate thinking. I flew to Paris, shopped the shops, three suitcases of merchandise, went to Hong Kong, got it all copied, flew in, restocked the shops, got all the creditors reflowed, and got the business back to breaking even in four months.
"Out of the sky the phone rings. These people want to buy me up. I said no, I just bought it. Don't want to sell. They went on. And on. I said all right, come and see me. Said look, I want 10 million for it. They said how d'you make that out? I said, well, basically I don't want to sell, so if you pay me what it's not worth I'll sell it. Now I've got a deadline with the bank for February 26 1985 and I end up selling the business on the 25th. For seven million. Went down to the bank in Curzon Street, said what do I owe you? They said dunno, er, 3 million 430 thousand pounds, I said right, there's your cheque. Slapped it down. Done." He cracked his palms together, his eyes bright with remembered relish. "So," he said. "Can be done is my motto!"
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(Below: Philip Green in action)
