China was on the front pages because of Tiananmen Square rather than as a retail destination for global store groups and the controversy surrounding Salman Rushdie’s The Satanic Verses was in full swing.
It was 1989 and what’s now Majestic was losing money. In the intervening years How, who revealed on Monday that he would stand down within the next year, worked magic.
He has created a widely admired specialist business that has thrived, despite facing the same threat from supermarkets that derailed other small retailers. Quality and variety of stock and a business model built around selling by the case have been critical to turning Majestic into a national brand, but one of the real appeals to well-heeled customers has been outstanding service standards. Majestic was also early to embrace the multichannel opportunity – by 2007, the retailer was taking 100,000 online orders a year.
How floated Majestic on AIM in 1996. At£148 million, the retailer’s capitalisation today is higher than some well-known names on the main market, such as French Connection, reflecting how handsomely it has rewarded investors.
Few retail chief executives have been in post as long as the unassuming but puckish How, so investors may be nervy about his exit. But it looks as if the handover will be handled with the quiet efficiency that characterises Majestic.
Steve Lewis will become chief executive and has worked for Majestic even longer than How, having joined as a graduate trainee in 1985 and risen to chief operating officer.
In some circumstances, the appointment of a veteran internal candidate to the top job would go down like a glass of warm Liebfraumilch. In the case of Majestic, it’s testament to the strength and culture of the business. Investors will feel pretty confident that they can look forward to more of the same – a combination of focus on the existing business, commonsense financial discipline and a healthy dash of innovation.
Majestic can’t afford to stand still. Last Christmas was not quite as good as had been hoped beforehand, reflecting the jittery consumer climate.
But Majestic’s success to date is evidence that specialist retailers can survive and thrive. Majestic chairman Simon Burke described How as “a truly great chief executive”. Investors would agree and will raise a glass to his happy retirement and Lewis’s success.
George MacDonald is deputy editor of Retail Week