This week I did something I hadn’t done for a very long time.
I went into a branch of Bhs. The last time I visited one was to buy some primary school kit. My kids have now left home, so that must be more than a decade ago. The branch back then, in Canterbury, was closed in 2013 and the site is now a Primark, just one of a dozen or more that went the same way.
The news that Sir Philip Green is looking to dispose of his variety chain comes as no surprise. I wonder why he has held on to it for so long. On Tuesday afternoon the Oxford Street flagship, presumably the busiest in the 173-strong chain, was extremely quiet and totally lacking in any sort of atmosphere. The clothing offer was undistinguished and it was hard to fathom who it was aimed at. The huge images of a fabulously glossy skinny blonde model bore no resemblance to any of the few middle- and late-agers who were wandering about the place.
There was noticeably more spark about the home furnishings offer on the first floor, with quite a few attractive, contemporary designs that were sadly lacking among the clothing. It also had a good lighting offer, which reminded me that this was one of BHS’s specialities some years back.
With Sir Philip having nailed a For Sale sign on the ailing business (it lost £116m in 2012 and £70m in 2013), the question is: who will take it off his hands? Green has owned it since acquiring it from Storehouse in 2000 for £200m. His impressive financial turnaround of BHS in the few years after that was achieved, it is widely accepted, thanks to massive help from his friend and supply chain maestro Richard Caring (these days better known for his restaurants). In the decade since, BHS has been no one’s idea of an award-winning retailer and, much as Green dislikes failure, it’s a sensible decision for the retail knight to now cash in his chips and concentrate on his stronger assets in Arcadia.
Press reports suggest that PG (to use the internal company shorthand) is not minded to sell BHS piecemeal, which is understandable as it would take a long time and he’d still be left with a lot of branches that no one wants. I struggle to think of a single trade buyer in this country, but I suppose it’s not impossible to imagine a wealthy foreigner buying what they think is a prime UK name - BHS has about 90 franchises globally. But let’s not hold our breath for that one.
It’s irresistible to think that a deal may be struck with a restructuring specialist such as Hilco Capital, which would have fewer qualms than Green about breaking BHS up and selling the assets to the highest bidders, which could include supermarkets, Primark and new value chain Pep&Co, established by former Asda chief Andy Bond. With the property portfolio valued at between £100m and £200m (quite a wide range!), there is obviously a lot of meat to be picked off the carcass of BHS, even after something is done about its pension hole of £120m or so.
Having known Sir Philip for virtually all of the 35 years I have been in this business, I would not be surprised if he produced a deal that no one saw coming. But whatever the outcome, and despite its sales of £676m a year, I foresee the imminent end of the business that was started in Brixton in 1928. And with the greatest respect to all its 11,000 employees and everyone who has tried to give it a role in the modern UK retail scene, in its current guise will anyone really miss it? Does anyone miss Littlewoods or C&A?