1 Sir Terry Leahy, chief executive, Tesco
2007 RANK: 1
At last, evidence that the UK’s number one retailer is fallible. A nasty skiing accident earlier this year left the Tesco chief executive nursing six broken ribs and put him briefly out of circulation. By the time he returned – sounding, according to one colleague “like Darth Vader” – he had gone into overdrive with even more ideas for the business than ever.
Skiing injuries aside, it has been another vintage year for the UK’s top retailer. Last week, the grocer revealed record sales and profits, with strong growth in non-food and continuing development of its businesses in the Far East and Eastern Europe.
And then there’s the US. In the space of just six months, Tesco made it to more than 60 Fresh & Easy stores, but its decision to pause for breath last month led some in the media and the financial community to question how it was doing.
So it was unsurprising that Leahy, never known for his love of the media, appeared to take particular pleasure in confirming at last week’s results that the US was on track, that customer feedback was positive and that sales densities were double the average for US grocery retail.
In fact, there was barely a scintilla of bad news in the results. And, with UK non-food growth across a whole range of categories – from consumer electronics to sports equipment – defying the slowing market, Tesco remains the retailer pretty much anyone in the sector needs to fear.
The success is all built on knowing Tesco’s customer, whether in Southend, San Diego or Shanghai. And Tesco’s willingness to adapt its model for international markets – in contrast to Wal-Mart – has meant it has been much better equipped for its assault on the world’s emerging markets.
Getting to the top is hard; staying there is harder. And there will be challenges ahead as the market tightens, with food being hit by inflation and non-food by slowing consumer confidence. Despite last week’s reassuring noises, the jury still remains out on the US and building a credible and sustainable business Stateside will inevitably take time.
There is also growing pressure from lobby groups and hostile camps in the national press. The writ served on The Guardian earlier this month indicates that Leahy is taking a tougher line on the Tesco’s opponents.
But there’s little chance of the fanatical Everton fan taking his eye off the ball. And, while his team may be looking doubtful to quality for the Champions League, Leahy himself has his place in retail’s hall of fame well and truly secured.
2 Sir Philip Green, owner, Arcadia and Bhs
2007 RANK: 6
Some of Sir Philip Green’s raft of high street chains are finding the going as hard as anyone else right now, but the tycoon can raise a glass to successes over the past year and look forward to replicating them – and more – in the next 12 months.
Last May, the billionaire fashion tycoon created one of the biggest buzzes in the sector when Kate Moss’s range for Topshop was launched and crowds queued on Oxford Street to snap up the supermodel’s designs. Moss’s latest collection – her fifth – has just been launched in 80 Topshop stores.
Green’s young fashion chains, Topshop, stablemate Topman and Miss Selfridge, are all going great guns. The first two are likely to enjoy record years financially, putting Green among a diminishing list of store chiefs with some reason to celebrate amid tough market conditions, although other Arcadia chains and Bhs are finding the going more difficult.
This autumn, assuming all goes to schedule, Green will open the doors of a flagship Topshop in New York. The store will be the chain’s first in the US and Green plans to make a splash in the Big Apple.
Conscious of the differences and difficulties facing any British entrant to the US market, Green remains cautious about whether he will open a Topshop chain in the US. Other options, such as deals with leading department stores, might be the preferred route. But, whatever he decides, Green has set out his ambition for Topshop to become a worldwide success.
He also sees opportunity in emerging markets such as India and China and hopes to have stores in seminal fashion cities such as Milan and Paris.
The US venture will be a key development. “If we want to be a global business, we’ve got to be able to perform in America,” Green told Retail Week earlier this month. Green’s impact on the industry was reflected in his inauguration to the Retail Hall of Fame at this month’s World Retail Congress in Barcelona, alongside peers including Inditex founder Amancio Ortega and J Crew boss Mickey Drexler.
Green’s influence on wider society continues to be felt through his creation of the Fashion Retail Academy and support for good causes, such as the Retail Trust.
The tycoon has no doubt that high street conditions are difficult, but is focused on solutions. He said: “You’ve got to be thinking all the time about what you do to service the customers that are going shopping. What can you do about your environment, your window, your store, what are the levers you can pull to maximise any opportunity out there that there is?”
3 Sir Stuart Rose, chief executive, Marks & Spencer
2007 RANK: 2
Sir Stuart Rose’s huge contribution to the retail sector was recognised with a New Year knighthood, but the Marks & Spencer boss’s Teflon reputation has been a little tarnished since.
First, the City was disappointed by M&S’s Christmas trading performance and analysts inevitably began asking whether the retailer’s recovery was running out of steam. More importantly, Rose – one of the sector’s most charismatic leaders and effective communicators – became embroiled in a high-profile row with City institutions about his proposed elevation to the role of executive chairman.
His promotion was announced in March, immediately drawing a barrage of criticism from big investors concerned about the perceived flouting of corporate governance rules. The upshot was that, although likely to take up the controversial position, Rose will have to stand for re-election at the AGM each year until his planned retirement in 2011 – and he won’t be getting a pay rise to reflect his increased responsibilities.
However, Rose is unlikely to let the turbulence since the turn of the year distract him from his purpose of fully restoring M&S to its former glories.
He has said that trading prospects look tough for the rest of this year and into next, but there’s still a chance that he might be able to pass the£1 billion profit mark when he unveils full-year figures next month. If that does not happen, expect Rose to throw himself into the task with even greater energy.
When he stands down – and the date is now publicly set – he will want to leave a stronger business and go down in history as the retailer’s saviour. Despite City quibbles, Rose has achieved a lot at M&S over the past year.
Approximately 70 per cent of the store estate has now been spruced up and clothing volumes have been running at their highest level in six years – the importance of which to continued success has been overlooked, in Rose’s view.
He has set international expansion in motion once again – there have been three deals this year – and overseen the ramp-up of the retailer’s e-commerce offer.
Rose has made a big impact outside M&S. The decision to start charging for plastic bags, generating huge publicity, has the capacity to change shopper attitudes and cut use by as many as 280 million bags a year. Appointed to Prime Minister Gordon Brown’s business council last year, Rose also became chairman of Business in the Community at the start of 2008.
4 Justin King, chief executive, Sainsbury’s
2007 RANK: 4
Justin King managed to steer Sainsbury’s through turbulent waters last year, when it was buffeted by two aborted bids by Delta Two and a CVC-led consortium. Despite the inevitable upheaval, its recovery continued unabated and King has now delivered 13 consecutive quarters of like-for-like sales growth.
The Making Sainsbury’s Great Again programme he launched in 2005 has had its critics. But King achieved his goal of delivering an extra£2.5 billion of sales – it actually posted an extra£2.7 billion in the three years to March 31, 2008.
King did this through enhancements to the grocer’s offer, supply chain and stores, rebuilding its brand and a little help from celebrity chef Jamie Oliver.
That said, doubts remain about his long-term strategy. Analysts say Sainsbury’s estimated operating margin of 3 per cent for 2007/08 is still behind the 4 per cent level of 2004. Some analysts also question whether the grocer should be so gung-ho in its pursuit of non-food sales, given its strength and reputation for fresh food.
Any plans could be overshadowed by Delta Two, which still owns 25 per cent of the grocer, coming back with a renewed bid after the middle of June, although the credit crunch may curtail its ambitions. But, irrespective of any activity on Sainsbury’s share register, JS is likely to continue progressing under Captain King.
5 Arthur Ryan, managing director, Primark
2007 RANK: 10
There are not many men who can claim to have changed the face of young fashion and continue to do so in to their 70s. However, Ryan can comfortably wear that crown.
The king of cheap and chic clothing for the under-35s, Primark has continued to strike fear into the hearts of fashion and supermarket retailers this year.
In February, it emerged that the business – which the secretive Ryan founded in Ireland in 1969 – could topple retail institution Marks & Spencer in the race for clothing market share.
Primark notched up another 2 per cent for the year to command 10.1 per cent of the clothing sector. This week, it revealed a market-beating 25 per cent sales rise and 22 per cent profit jump, with like-for-like sales up 4 per cent in its first half to March.
In contrast to many fashion retailers, its pre-Christmas sales were ahead of expectations. It opened its largest store to date in Liverpool in September – which took half a million pounds on its opening day – and its retail space has surged from 3.5 million sq ft in 2006 to 5 million sq ft across its 173 stores.
Further afield, the retailer has expanded into Spain and is set to conquer the German market with a store opening in Rotterdam before the end of the year.
Ryan continues to be the driving force behind the business – the big question remains: what happens when he finally decides to call it a day?
6 Mike Ashley, chairman, Sports Direct
2007 RANK: 9
Retail is all about characters and they don’t come much bigger than Mike Ashley. Since Sports Direct floated last February, the man whose name rarely appeared in print without the word reclusive attached has come out of the shadows – most recently seen at the weekend celebrating Newcastle United’s win over deadly rivals Sunderland on the touchline with Kevin Keegan.
He may be one of the most eccentric chief executives retail has seen, but there’s no doubting the impact the former squash champion has had on the sector. His bargain-basement approach and prices to match have crucified rivals like JJB, while his mysterious stakebuilding antics have made life interesting for companies such as Blacks.
His compulsive deal-making has, some claim, allowed him to be distracted from running Sports Direct, which had a torrid first year as a quoted company with two profit warnings and a collapse in share price to a third of its IPO level.
England’s absence from this year’s European Championships won’t help him tackle the challenges of 2008, but the year has started in a calmer vein, so maybe the ship has been steadied. Alternatively, he might just be concentrating on Newcastle.
7 Andy Bond, chief executive, Asda
2007 RANK: 5
Fitness fanatic Andy Bond has trimmed Asda’s operational fat and got the grocer running in the right direction since he took the chief executive baton in 2005.
Last year, Bond kept price in check and enhanced Asda’s premium, organic and non-food offer to deliver a record sales year. Under his leadership, Asda has also been quick out of the blocks this year, according to TNS.
However, it has not all been a bed of roses for Bond. Asda will have been disappointed that the Competition Commission inquiry’s provisional remedies report did not do more to rein in Tesco or propose a more radical overhaul of the planning system.
Bond also called time on its high street George stores and converted its last Essentials store into a small Asda. Both formats struggled, but Bond is bullish about the Asda Living format. He wants to double the number of homewares stores to 26 this year.
Asda is ramping up its grocery and non-food offer online, as it takes on Argos and Tesco Direct. But the big talking point is how long the highly competitive Bond will want to hang around playing second fiddle to Tesco.
8 Charlie Mayfield, chairman, John Lewis Partnership
2007 RANK: 25
The debonair Charlie Mayfield continues to soar up the power list after stepping into the large shoes left behind by his predecessor Sir Stuart Hampson. In his first year in the role, Mayfield has maintained a steady the ship after a number of high-profile changes.
The former Scots Guard, who was previously managing director of the John Lewis department stores, has outlined expansion plans that will double the size of the business in a decade to generate£12 billion of annual sales.
Last month, he announced record profits for his first year in charge and the biggest staff bonus in 10 years. Pre-tax profits were£380 million for 2007. The retail bellwether has continued to outshine the rest of the high street and maintained its flock of loyal shoppers.
The former marketing executive is making his mark on the group with renewed advertising activity and cross-brand tie-ups between grocery arm Waitrose and the eponymous department store chain. In October, the group unveiled a food hall, supplied by Waitrose, at its Oxford Street branch and has plans to roll it out to new stores.
A fervent advocate of the co-operative structure of the business, Mayfield is John Lewis through and through. Despite a few wobbles earlier this year in its run of stellar sales, with homewares sales at their weakest for four years, Mayfield remains confident that the company can cope better than its rivals.
9 Charles Dunstone, founder, Carphone Warehouse
2007 RANK: 23
Even among the stellar names on this list, not many can claim to have invented a whole genre of retailing.
But Charles Dunstone has never been one to rest on his laurels and has continued to take bold steps in order to expand Carphone Warehouse, whether by giving away free laptops or developing the company’s Geek Squad service proposition.
The year has not been without its challenges and last week the company’s share price took a hammering after it revealed disappointing levels of connections to its Talk Talk broadband service. The company cut the price of the Apple iPhone by£100 last week in order to stimulate sales.
But speaking at last month’s Retail Week Conference, Dunstone explained how the company is reacting to the downturn by continuing to innovate.
Never one to shy away from admitting to the business’s failings, he explained his plans for a new system of radical transparency, where all problems within the business are openly displayed to customers via the web site.
Carphone’s transatlantic relationship with innovative US electricals retailer Best Buy continues to be a source of interest but really, who knows what his next idea will be? Dunstone’s ability to pull rabbits out the hat remains second to none.