‘Retail is detail’ must be one of the oldest mantras in the industry but, sadly, Lisa Wilkinson wasn’t across it.
The former chair of the family business, the home and variety store group Wilko, appeared before MPs scrutinising the retailer’s collapse at a business and trade committee hearing this week.
She has come in for ferocious criticism, particularly over dividends taken and a £50m pension scheme deficit, since the collapse of Wilko earlier this year and the resulting loss of 12,000 jobs.
In contrast to some who have appeared at similar inquiries, Lisa Wilkinson did not come across as a pantomime villain. Instead, she appeared to be woefully out of touch with the crucial day-to-day realities of her business, a high-street name founded by her grandfather that had traded for 90 years.
She pointed out all sorts of external factors that contributed to Wilko’s demise, everything from rising costs and the withdrawal of credit insurance to former PM Liz Truss’ infamous mini-budget, which sent interest rates soaring and scuppered any hopes of a loan.
That being said, all those factors, while undoubtedly unhelpful to Wilko, hit the retail industry more widely and some of Wilko’s rivals have not just survived but thrived.
Too little, too late
Under questioning, Wilkinson sometimes seemed at sea. She was not a “financially qualified person,” she didn’t “recognise” some figures, and similar phrases peppered her answers. If so, you wonder how she could fulfil her role or navigate a future for Wilko, which for years had no chief executive.
Indeed, she repeated her assertion that she wasn’t a “financially qualified person” so many times that it was remarked upon by committee chair Liam Byrne who noted, “but you were the executive chair of the board with fiduciary duties.”
When, on the verge of tears, Wilkinson said she was “devastated” by Wilko’s end, and apologised to staff, it appeared sincere. She seemed genuinely bereft at what had happened and maintained that although there had been debate about using family money to save Wilko, there were now “insufficient funds to make a difference.”
That makes it all the more surprising that, during her tenure, she let the business drift so much away from the proposition that was its original strength, and did not push through change fast enough while the wider landscape was being transformed by trends such as rivals moving out of town and into retail parks.
In the end, Wilkinson did recognise that change was urgently needed and drafted in the well-regarded Mark Jackson as chief executive in 2022, but a word used a few times at the inquiry was “inertia” – and that is probably the right term to apply to Wilko’s decline and fall.
While her testimony had a strong whiff of ‘everything was to blame but me’, inability or unwillingness to change was at the heart of Wilko’s problems. That was evident to many, including the GMB union, which came away from meetings with Jackson’s predecessor in disbelief that the retailer could not see the perilous position in which it had found itself.
Protect the magic
Inertia, not Liz Truss and Kwasi Kwarteng, killed Wilko. Had its challenges been fully recognised and acted upon earlier, maybe it would have survived as a paragon of family ownership. It’s another salutary lesson for the industry of the danger of thinking that retail institutions will always remain so.
Sometimes all talk of retail transformation raises eyebrows or brings a wry smile, signalling the suspicion of boardroom buzzword bingo. But constant adaptation is a prerequisite for retail success – it has taken the best retailers through the pandemic and its aftermath, and all the cost and supply chain challenges of the past few years.
To borrow a phrase from Marks & Spencer, which not so long ago was itself floundering but is now performing well, the mission must be to “protect the magic and modernise the rest”. It’s a mantra that applies to pretty much everyone; it necessitates familarity with the detail of retail and might even have saved Wilko.