Entries for two thirds of last week’s 18 Oracle Retail Week Awards came from the contenders themselves.
Entries for two thirds of last week’s 18 Oracle Retail Week Awards came from the contenders themselves. This is not to denigrate the winners’ success, as many powerful peers had also put themselves forward. But no entries were invited for the top five awards, which depended solely on the judgement of the industry and the panel.
Another coincidence is that just as Sir Philip Green’s Outstanding Contribution to Retail was being trumpeted, strong rumours were growing that Marks & Spencer, his erstwhile very public target, is exciting the attentions of a sovereign fund whose wealth eclipses even his own.
If M&S was to return to private hands (it was once, of course, a family owned business) focus will be recast on the frequently inferior performance of public companies compared with their private competitors.
In the Top 100 Family Businesses in Europe (compiled by CampdenFB), retailing is the most represented sector. Aldi and Zara, two of last week’s top five award winners, are controlled by families (Albrecht and Ortega)whose aversion to publicity is as well known as their fascias. They’re not alone: the Brenninkmeijer, Kamprad and Mulliez clans, entr’autres, want spotlights shone on their stores not their fortunes. But this is not the universal rule, for some retail emperors revel personally in the limelight just as much as their fellow celebrities from the entertainment world. Which brings us back to Sir Philip Green.He loves the public eye but loathes public equity. Private equity is another matter, to which his recent deal with Leonard Green bears witness.
Might some older family strongholds - eg the owners (mentioned above) of C&A, Ikea and Auchan, as well as others like that nec plus ultra El Corte Inglés, or its compatriots Mango or Mercadona - finally follow suit? Don’t bet against it.
Some family firms are less averse to public investors. Amancio Ortega’s elevation to his status as the third richest man in the world has sprung from floating 25% of Inditex 12 years ago. His fashion rivals, the Persson family, have certainly not seen the global expansion of H&M held back by allowing the public to access their shares as well as their stores.
From the Westons on both sides of the Atlantic, to the Colruyts in Belgium, it’s clear that when families still hold control, businesses can thrive upon private-public partnership.
Partnership. There we have it. The ownership structure of Retailer of the Year John Lewis is not accidental to this accolade. Why is Waitrose, not just Aldi at the other end of the spectrum, outperforming the sector? Why is John Lewis, not least through its electricals department, finding meteoric success while Comet falls to earth?
Perhaps it’s because the people who work there truly feel part of the deal. But so do the people who shop there; whether they purchase in public or in private - and even though they can’t buy shares in JLP - they all have a stake in this award.
- Michael Poynor, Managing Director, Retail Expertise