The time to be spent drawing up a revival programme will draw fire from Cheshire’s critics, who have ideas aplenty about what’s gone wrong at Kingfisher, why and how the problems can be rectified.
But Cheshire showed in his first prelims presentation since assuming the top Kingfisher job that he’ll on the case. Despite his senior roles at Kingfisher over many years, it would be unfair to expect him to unveil detailed strategy just eight weeks into the role of group chief executive – the responsibilities, solutions and business direction of Kingfisher under his leadership deserve a period of grace for him to fully formulate strategy.
He would be given less of a leash had he not shown yesterday clear evidence that things will not definitely stay the same. In a bullish presentation, two points stood out.
The first was the number of times he used the words retailer and retailing. One of Kingfisher’s problems of late, astonishing as it might be given its 755 stores worldwide, is that it has often seemed not to think of itself as a retailer, but as a holding company that happens to be in the stores business.
That is clearly a thing of the past. An early change instituted by Cheshire and a signal of the direction in which the business is likely to be taken, is restructuring including the creation of a “retail board” that will preside over Kingfisher’s reinvigoration.
The business of selling, of product authority, of service and skilful buying has been placed centre stage. Cheshire’s sales pitch didn’t come across as bland MBA stuff that looks good on paper but bears no relation to the real world of shopkeeping, but rather as determination to put retail excellence back at the heart of Kingfisher. At present, it’s just an ambition, but it’s the right sort of ambition to have.
The second big message was that Kingfisher will be run along the lines that typify private equity ownership. Terms such as return on capital, management of debt, efficiency and shareholder value peppered Cheshire’s presentation. That’s all to the good and we’ll see over the next few years whether he comes good on the promises,
It was also good to hear that improvements to flagship chain B&Q will be central to the improvement of Kingfisher as a group. B&Q and Kingfisher, despite problems that have now lasted some years, remain world-class retailers.
Cheshire has not revealed his entire hand yet, but the broad message was encouraging. If he can really deliver on the nitty-gritty essential to realise the ambition he’ll have earned himself a place among retail’s very best.