The rise and fall of Sir Philip Green, the retail
king who fell from grace
A new BBC documentary sheds light on the
behind-the-scenes story of Topshop’s rise and fall, and Green’s controversial
management
BY JIM
ARMITAGE@ARMITAGEJIM
27 Sep 2022
“You
f**cking onion, don’t you f***ing get it?”
It could
only be Sir Philip Green on the phone. The negative piece the Evening Standard
had written on his Arcadia retail empire had ticked him off royally and, as was
his wont, he was straight on the phone to bark what he thought of it. And me.
You always
knew such barrackings were coming and, when they did, you also knew his initial
burst of fury – usually with the funniest concoctions of abuse and faux threats
of violence – would eventually give way to a joke, a gossip, and the invitation
to a cup of tea.
It was
precisely that mixture of brawn and charm that got him to the riches he
achieved as the undoubted king of the British high street.
But, two
years after the dramatic closure of Topshop stores, Green’s reputation lies in
tatters, and his characteristically brash modus operandi might provide some
clues as to why. Trouble At Topshop, a two-part BBC documentary, has shed new
light on the behind-the-scenes story of the iconic brand’s rise and fall, and
Green’s controversial management.
Raise your
glass to a premium gin with a difference
He might be
a household name but, before Green joined the brand, it was propelled by a
revolutionary team, notably led by women. The documentary describes the Topshop
of the Eighties and Nineties as a prelapsarian wonderland of female-led
creativity, transforming the high-street landscape by offering fashion by
women, for women. Fronted by brand director Jane Shepherdson, the woman-heavy
team was once an outlier in the fashion sphere.
So when
Green acquired the brand in 2002, his brash machismo and prioritisation of
profit over quality was an unwelcome shakeup. Former Topshop employees
interviewed described toxic workplace encounters with Green – Shepherdson even
claimed that he took a phone call in the middle of her resignation.
So, just
how did Green come to rule the high street, and where did it all go wrong?
Early days
Green was
born in 1952, the north London son of a father who owned property, garages, and
electrical businesses. His parents sent him to a Jewish boarding school, Carmel
College in Berkshire, and gave him a fairly unaffectionate childhood.
He left
Carmel with no O-Levels, but learned to be a crafty negotiator at the knee of
Rodney Geminder, a successful shoe wholesaler based in Old Street.
As told in
Oliver Shah’s biography Damaged Goods, he learned to buy low and sell high,
particularly bankrupt stock, which was traded from the pubs north of Oxford
Street – a district that remained his stomping ground for the rest of his
career.
With his
mother Alma, he went into clothes manufacturing and importing, often not
successfully and usually underwritten by her money.
But he
learned from his mistakes.
“Jean
Genius”
With his
knowledge of buying stock for Geminder from companies in trouble, he made his
first major success in his 20s, buying a distressed retail chain called Bonanza
Jeans using borrowed money from Bank Leumi.
Green knew
it had 400,000 pairs of jeans in stock which had been totally undervalued by
the receivers and bought the whole chain for a little over £1 million.
Within a
month, he’d repaid the bank its £1 million and, after roasting its buyers into
driving better bargains, he was living high on the hog, working hard during the
day and spending fast in the Ritz casino by night.
He learned
that menacing style reportedly from an unsavoury loan shark he used to use
called Anthony Schneider.
Then, he
bought Jean Jeanie, another chain in distress, for around £500,000, adding it
to Bonanza, turning it into profit, and selling the combined group to Lee
Cooper for £7 million.
The press,
who he assiduously courted even then, called him the Jean Genius.
It was
1986. Green was 34, loaded, and sporting a Spandau Ballet hairstyle.
Posh boys
and scandal
His
barrow-boy trading style initially went down well in his next venture, a
stock-market quoted menswear business called Amber Day. By force of his
personality, and trading prowess, he turned the business around, moving
manufacturing to Hong Kong for cheaper supplies.
He
restructured its Woodhouse and Review chains then bought What Everyone Wants,
sending his share price soaring as staid City institutions were drawn to this
epitomy of the Eighties , winner-takes-all zeitgeist.
But, when
recession came, sales crashed brutally. The same City which once loved his
maverick style fled, citing fears of lack of transparency and good practice.
They muttered darkly about an apparent share-support operation (which he
denied) and his connections to characters such as the convicted fraudster Roger
Levitt, and Schneider.
Green was
out, with news leaking about a Department of Trade and Industry investigation
hovering over him. The probe came to nothing and Green was left resenting the
City’s “posh boys”, a chip on his shoulder he carried throughout his life.
Serious
money
He soon
bounced back, teaming up with Scottish tycoon Tom Hunter, fashion importer and
now restaurateur Richard Caring, and the Telegraph-owning Barclay brothers, to
buy Sears for £548 million. He asset-stripped the empire within months, and he
and his fellow investors made a £280 million profit.
In 1999,
having proved to the City he didn’t need it to make money, he bid for Marks
& Spencer, with a view to making a killing selling the freeholds on its
300-strong store estate.
Again
though, the “double barrelled c***s”, as Green called City types, were to be
his undoing, as his banking advisers took fright at dark rumours that his wife
Tina had been buying shares in M&S before the bid.
BHS and
Arcadia
He would
not lick his wounds for long. Soon after, he bought British Home Stores (BHS)
in a move that would both propel him to billionaire status and destroy his
reputation.
He and his
crack-management team, including ex-Debenhams chief Terry Green and Allan
Leighton of Asda fame, set to work boosting BHS’s profits through skilful
buying and stock management, quickly turning a business he had bought for £100
million into a £1 billion one.
He went on
to buy Arcadia, where retail veteran Stuart Rose was chief executive, sealing
the deal with Rose in a final round of haggling outside the George Club. in
Mayfair.
Arcadia’s
Topshop brought him glamour as well as wealth. He turned it into the hottest
retail property on the street, signing up celebrities like Kate Moss to design
ranges and appear with him at parties and fashion shows.
Buoyed by
success, he made another bid for M&S, which at that stage was being run by
Rose. He failed, and famously had a handbags-at-dawn moment with the suave CEO
on the street, jumping out of his limo and grabbing him by the lapels.
At the
height of Arcadia-BHS’s profitable heyday, Tina, in whose name his empire was
owned, took out a record-breaking £1.2 billion tax-free thanks to her residency
in Monaco.
It was
2005, and while some in the business world applauded his success, others found
it distasteful. More still were baffled as to how the company could afford it.
That question came back to haunt the Greens in future years.
Online
explosion
As the
retail world moved increasingly online, and big, legacy store chains like
Woolworths fell by the wayside, Green neglected to invest in taking his brands
digital.
Even in
bricks and mortar, competition was leaving his chains behind. Fast-fashion
chains capable of switching ranges in a heartbeat were beating his brands at
every turn. Primark, Zara, and H&M began to rule the roost.
BHS was the
first of the Green empire to crumble, and the halcyon days of racy profit
margins dramatically turned into a miserable tale of contraction.
Worse
still, it left a massive hole in its pension scheme.
Green spent
his days and nights trying to figure out an exit.
Sale to a
spiv
That
eventually came in 2015, when he sold the business for £1 to Dominic Chappell,
a former bankrupt racing driver.
Green
rejoiced at the sale, thinking it had lifted a huge weight from his shoulders.
But it was not to prove so.
Chappell
turned out to be a spiv (he was earlier this month jailed for six years for tax
dodging).
He was
totally incapable of turning the business around and the company collapsed into
bankruptcy with 11,000 job losses and a £571 million pension deficit.
Pension
shame
The row
that ensued was to destroy Green’s reputation and almost claim his knighthood.
He was pilloried by MPs and the pension hole he had left the company with when
he passed it on was described as “the unacceptable face of capitalism”. A
bizarre, six-hour performance in front of the business select committee saw him
berate one MP for “staring” at him.
Eventually,
he paid £363 million into the pension fund after lengthy negotiations with
regulators. Over the years, he and his family had collected some £580 million
from BHS in dividends, rents, and interest on loans.
He had once
been a regular on the party circuit. Newspapers and glossy magazines salivated
over extravaganzas like his 60th birthday party, where he flew 150 of his
‘closest’ friends to Mexico, including Naomi Campbell, Leonardo DiCaprio, and
Kate Moss.
But, since
the BHS scandal, he has often been exiled to his Monaco base.
Don’t feel
too sorry for him – at the height of the BHS pensions fiasco, he took delivery
of a £100 million yacht, Lionheart, on which he spends much of his time.
Philip
Green became the bogeyman of the MeToo movement
But, even
as he hid, the critical stories have followed him. In 2019, reports emerged
alleging that he had made racist remarks, groped female staff, and been abusive
to other employees – claims he vigorously denies.
He became a
bogeyman of the #MeToo movement. The friends who remained loyal despaired.
Harold Tillman, veteran retailer and former owner of the Jaeger chain, said:
“I’ve known him 40 years. I have seen him do so many kind, good things for
people.”
But, as
even Topshop losses soared to nearly £500 million, he was being seen as a
dinosaur in a world of rising online giants, like Boohoo, Asos, and the Hut
Group.
Like his
retail empire, he had failed to keep up with the sensibilities of the modern
world.
Coronavirus
As in so
many industries, the coronavirus pandemic accelerated trends that had been
running for years.
Covid’s
lockdown of shops and malls has seen not only Green’s stores suffer like never
before, but his revenue via department stores like Debenhams, which went under.
However,
few will feel too sorry for him. The Greens are still one of Britain’s richest
couples.
They have
long since diversified their wealth away from retail and into property and
other ventures.
But, as far
as his reputation on the High Street goes, with Arcadia following Debenhams
into administration, the king has fallen far.
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