Following the death of legendary retailer Lord Sainsbury of Preston Candover, Shore Capital’s Clive Black pays tribute to a man who changed the grocery and retail landscape
There will be many that operate at all levels in the British food industry that will never have met John Sainsbury, but his legacy is imprinted across it.
Alongside the late Sir Ken Morrison, and not to overlook Sir Jack Cohen and Sir Alistair Grant, John Sainsbury is one of Britain’s greatest ever retailers, and is arguably the man who has had the biggest influence upon the grocery industry’s development.
John Sainsbury commenced his working life in the family grocery business in the 1950s. With a considerable frame and gruff voice that will never leave those that worked and engaged with him, he became a director of the eponymous business in 1958, going on to become group deputy chairman in 1967 and chief executive and chairman in 1969.
He remained in that ultimate leadership role until his retirement in 1992, a key inflection point in the history of Sainsbury’s - one that the group has been seeking to cope with to various degrees ever since. When John Sainsbury retired, the business recorded over £600m of pre-tax profit - last week the group upgraded its full-year guidance to £720m from £660m.
The Alex Ferguson of supermarkets
Like Ken Morrison, John Sainsbury demanded high standards. His keen eye for detail and straightforward manner is engrained in the mentality and culture of the participants and progeny of his time.
Hence, John Sainsbury was to grocery retailing what Alex Ferguson became to top-flight football in England, successors of the latter not yet rekindling the greatness of the ultimate leader.
Maybe it was the mix of drive, talent and bloodline but, whatever the combination, Sainsbury led his business through revolutionary times in retail, and he delivered a Sainsbury’s that, in the early 1990s, was potentially set to be a world-leading business. It was also one that also worked for shareholders, the group’s market capitalisation under his leadership rising from not much over £100m to over £8bn.
That Sainsbury’s did not meet the potential Lord Sainsbury had hoped for was something that I had the honour to speak to him about in one of the most challenging but greatest moments of my working life when Lord John asked me to go to Queen Anne’s Gate to present to him on… Sainsbury’s.
Whilst in his late 80s his mind was still so sharp. He still had grocery retailing in his blood, not least having just visited Sainsbury’s new Nine Elms store, his memory vivid, and the gruff still voice resonated.
The ongoing progress of Sainsbury’s arguably reflected a failure of succession, a not uncommon feature of long-standing British grocers it should be said, but it is clear that the business which was the biggest beneficiary of Lord John’s retirement was Tesco.
Whilst it is impossible to prove, one can quite reasonably assert that Lord MacLaurin and his ultimately much more successful and great successor, Sir Terry Leahy, would not have made the progress that they did at Tesco if Sainsbury’s remained the competitor it was under John Sainsbury.
In Lord John’s time, Sainsbury’s was at the forefront of retail development with grocers evolving from counter service local outlets to self-service supermarkets and then superstores, the latter with easy access to the car as bypasses emerged across these isles.
The most advanced grocer in the world
Within the store, John Sainsbury worked under the banner of “Good Food Costs Less at Sainsbury’s” – one that it may well have been wise to stick with through the years, and introduced centralised purchasing, central distribution, a world-leading private label, electronic checkouts, and an advanced chill chain.
Whilst all of these innovations were not exclusive to Sainsbury’s, as a collective it probably was in his time the most advanced grocer in the world.
Beyond groceries, Sainsbury created Britain’s first hypermarkets - Savacentre - long before the emergence of Tesco’s first Extra, Homebase, and took the business to New England though Shaw’s, the latter two ventures subsequently being sold.
With arguably the best-located sites in England, JS also became a major fuel retailer. Amongst all of this retail ambition, drive and delivery, current chairman Martin Scicluna points out that Sainsbury’s listing in London was at the time the largest in the Stock Exchange’s history.
A truly great man has passed away and his legacy in fundamentally shaping the direction of the British grocery sector to be one of the most advanced in the world, if not the leading market, is experienced to this day by millions of people.
As Bill Currie, the number one food retailing equity research analyst at the time of Lord John’s retirement put it to me: “What a retailer. Legend.”
Rest in peace, the truly great Lord John.
This article was originally published as a note by Shore Capital.
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