Sir Philip Green, winner of this year’s Outstanding Contribution to Retail award, talks about building his empire, US success and doing his bit for the industry.

Sir Philip Green

Standing in the West Coast offices of private equity firm Leonard Green & Partners, Topshop tycoon Sir Philip Green gazed out of the window.

On one side the waves of the Pacific lapped the shore, on the other the mountains towered in the East. In between lay California.

For Green, who today celebrates his 61st birthday and was last night recognised at the Oracle Retail Week Awards for his outstanding contribution to retail, the view ignited the same spirit of excitement experienced by countless others upon arrival in the Golden State.

Unlike earlier generations, billionaire Green arrived already having made his fortune from his Arcadia fashion group but, just like those who pitched up with empty pockets but brimful of ambition, he saw a land of opportunity.

Green may have achieved more at home in the UK than many of his contemporaries during a lifetime in
the rag trade, but he talks about the potential of the States - where Topshop has just opened its first Californian shop in Los Angeles - with the same enthusiasm as a youngster starting out in business.

Speaking to Retail Week in his sixth-floor boardroom just off Oxford Street, home to the Topshop flagship that has become a destination for fashion fans from all around the world, Green talks excitedly about his ambitions for the US in between stabbing at his plate of salmon and salad.

In December last year, Green sold a 25% stake in Topshop and Topman, the flagship of his Bhs-to-Miss Selfridge group, to Leonard Green & Partners in a deal valuing the brands at £2bn. It allows him to build on the fledgling Stateside presence he has established in the last few years following Topshop’s flagship debut in New York in spring 2009.

Despite the maturity of the US market, the retailer’s arrival there has brought the chance to build the business in an entirely new way. Recalling his audacious acquisition of Arcadia in 2002, before the credit crunch and the meteoric rise of online selling, he says: “If you were starting out again today, as a retailer, what would your portfolio be, based on the shifts of the last decade?”

The answer is a new way of doing business, blending online and destination stores, that is quite different to running Arcadia, which has 2,500 stores across its fascias, in the UK.

“The basis that we are going to pastures new is that, unlike England, we don’t want a shop on every street,” emphasises Green. The latest US opening, at The Grove in Los Angeles last month, epitomises Green’s hopes.

“The point of difference is prominent, quality locations where we can show our brand in the best light. LA is a dream - if I could have 30 of those.

“There’s 40 million people in California and we’ve got one shop. We’ve got a chance there. You can build 10, 20, 30 great locations. It’s very different to here, where we’ve got a heavily populated marketplace.”

Although it is early days, Green says that last month’s opening at The Grove in LA has made a splash and developers across the States are keen to talk to him about opportunities.

“It’s changed the footfall of The Grove. All the other retailers are saying they’re getting better footfall - it’s brought in a different crowd.”

The Leonard Green deal means that Topshop can expand more rapidly in the US, where it had already struck a concession partnership with department store group Nordstrom - famous globally for its high standards of service.

Pictured with Miley Cyrus at the Topshop Chicago opening

Pictured with Miley Cyrus at the Topshop Chicago opening

While company-owned stores are proving a hit with consumers, the Nordstrom deal has also created shopper excitement and online is growing apace.

Although Topshop will carry on opening its own stores in the US, neither Green nor Nordstrom see any conflict in their partnership. The likelihood is it will be bolstered, so successful has it proved so far.

Green says: “We’re in a big conversation to extend that. All things being equal it will double by autumn.”

The range has drawn consumers to Nordstrom.com, as well as to the Topshop site which carries the whole offer.

Topshop make-up will be introduced soon on Nordstrom.com and could be introduced in up to 50 beauty halls, and footwear may be put into 20 to 30 premium shoe departments.

Green says: “We’re both getting new customers.”

World at his feet

The US drive, which has taken Topshop into locations as diverse as Hawaii and Miami, is just one instance - albeit the biggest - of Green’s overseas expansion.

In the last 12 months he has done a deal to sell the brand in South Africa, and openings in Hong Kong, China and other large emerging markets are on his agenda.

The internationalisation of Topshop is the latest summit climbed in a retail career spanning decades. While Green’s story is not quite rags to riches - he came from a comfortable background - it is a tale of determination and ambition that has swung from lows to highs.

It takes in working on a garage forecourt after leaving school at 16 to a string of bold deals, culminating in ownership of and running a business that ranks among the world’s retail greats.

Now that Green is such a familiar fixture in the papers, often in the society as well as the business pages, it is easy to forget that once he was known only to people in the industry.

It was in the late 1990s, when Green came to prominence through a string of high-profile deals, that he really emerged as one of the most powerful people in business. But the Croydon-born entrepreneur had spent his entire working life in retail, or ventures closely related to the stores sector.

He spent time as a shoe importer, bought and sold stock - often picking up stock from companies that had gone out of business - and in 1979 opened up shop himself at 41 Conduit Street in London’s West End.

In the following years he became the owner of Jean Jeanie, which he sold in 1988 before going on to run Amber Day - a public company with which he parted on unhappy terms - and then once again pursued private business interests which were to catapult him into a position as one of retail’s foremost power brokers.

Deals such as the acquisition of Olympus - later merged into Sports Division - and Mark One followed and Green hit the headlines in 1998 with a bid for Sears, which he took control of for £548m in January 1999.

And the rest, as they say, is history: the purchase in 2000 of BHS for £200m, Arcadia for £850m in 2002 and the famous 2004 attempt to buy Marks & Spencer for £10bn.

Self-made man

The variety of experience made Green a master of many disciplines. He says: “All the things learned along the way… we had to understand how to be real merchants. When you understand buying and selling, it’s great training. I’d been in Hong Kong - I knew how to buy and sell.

“I taught myself the different parts of the business, understanding what you could and couldn’t do. Having been through all that I think it’s easier to buy the companies.”

But he does not see himself as primarily a deal-maker. “People talk about me being a dealer - I haven’t done a deal in 11 years,” says Green. “I’m in the engine room.

“People know we’re not absentee landlords. I still speak every Saturday night to certain store managers directly to get a sense of what’s happening. It’s really important you’re not a stranger.

“You have to know a bit about product. To have a feel and touch for the business is really important. You have to have an opinion and a sense of what’s right and wrong.”

Long-standing colleague Ian Grabiner, the Arcadia chief executive who has worked with Green for the past 25 years, observes: “He can turn up at a meeting anywhere in the building, in whatever discipline, and has very good knowledge in detail.

“He can get to the nub of something straight away. He’s insightful because he’s done all the jobs himself, whether it’s buying, design, shopfit - he has a very good eye.”

Kate Moss posing in the Oxford Street window

Kate Moss posing in the Oxford Street window

Green’s application of lessons learned early in his career was evidenced when Topshop launched its collection with Kate Moss in 2007. The range, which proved a big hit with shoppers and generated acres of press, was promoted by Moss herself, who posed in Topshop’s Oxford Street flagship’s window. It was an approach first taken by Green back when he ran 41 Conduit Street.

Driving past Selfridges one day, Green noticed a group of mime artists performing in the street. “I stopped and said ‘Do you want a job?’” recalls Green. “I had live mannequins in the window. That’s where I got the idea when we put Kate Moss in the window on Oxford Street - that was one of the great pictures.”

Wider industry work

When Green bought Arcadia, he acknowledges that people felt uncertain about what his ownership would mean.

But he is proud of his record on employment, his championing of retail more widely through the Fashion Retail Academy and Topshop’s progress.

The Oxford Street flagship epitomises the brand’s success, and during Green’s time in charge its sales have climbed from £65m to an expected £165m this year.

At group level too the latest full-year figures showed a 25% rise in profits on the previous year, during which time the retailer bore the VAT increase rather than pass it on to customers.

The company’s success is mirrored in the tax man’s take. Green has sometimes faced criticism from corporate tax campaigners, but during his reign Arcadia has paid almost £600m in corporation tax, compared with only £50m in the five years before he bought it.

And although Green has a buccaneering image and can be an intimidating and abrasive character, he happily acknowledges that Arcadia’s improvement in the last decade has relied on the contribution of others. The business may be family owned but he says: “When you go from public to private, there’s a fear [among existing employees].

“You need to foster an entrepreneurial spirit. We’ve got a great team who know the business. It’s not just me. I like to think people work with me, not for me.”

A big change going on at Arcadia at present is the shift to multichannel, which has snowballed since he bought the business. “When we started here in 2002 total online sales were £20m,” he says. “If you were starting out again today, what would your model be?”

Topshop has moved with the times. The retailer sells online in 110 countries and last year etail sales surged by 22%.

Sir Philip Green

The world of privately owned businesses suits Green’s style. Never off his mobile phone for long, he regards his word as his bond. “If I say I’ll do something, I’ll do it,” he says. “When I was coming back to buy Sears, the Barclay family backed me on a handshake - it was bought on a handshake.”

Green’s influence has spread beyond his own commercial interests. He has sought to provide a springboard for young talent in fashion and retail through support for the Newgen fashion design programme as well as the academy, and to give back to the industry that has made him a household name. The tycoon has been a tireless supporter of industry good cause the Retail Trust through breathtakingly big donations at events such as its London ball. His contribution to the wider industry was recognised in 2006, when he was knighted for services to retail.

Green would no doubt apply to himself a piece of advice he sometimes dispenses to others: “If you don’t wake up and love it, find another job.” There’s no sign that he is tiring of a retail career that this week earned him recognition for a unique contribution to the industry.

Force behind the Fashion Retail Academy

Sir Philip Green

Sir Philip Green is closely associated with London’s Fashion Retail Academy, created so thatyoungsters can learn the skills and disciplines that will enable them to get on in the industry.

Green spearheaded the creation of theshopkeeping school, which won the backing of other big retailers when it opened in 2006 and is now supported in various ways by more than 100.

The tycoon takes a keen interest in the academy and is a frequent visitor. Anyone who has ever
seen him in action at its competitions or awards ceremonies would have caught another side of Green’s character.

Certainly he’ll ask the sharp questions he might put to one of his own staff - and expect a similarly well-informed answer - but what comes across above all is an infectious enthusiasm for the industry that made him his fortune and an evident interest in the young people themselves, who clearly love how he gets involved.

Since then-Prime Minister Tony Blair officially opened the academy, everyone from Gok Wan to
Gary Barlow has visited, emphasising both the quality of education provided and the fun of the fashion sector. Green says: “I thought ‘Wouldn’t it be great if we could get kids trained up in the industry’, and there are now 800 students.

“I say when I go to see them, if you want to win the lottery, make sure you’ve bought a ticket.

“It’s easy to say things can’t happen, but I’d like to think we point people in the right direction.”

Last year 60% of graduates found jobs in the industry and others went on to further education.

In pictures: Oracle Retail Week Awards 2013 - winners announced