Tonight marks a milestone for Sir Philip Green, one of Britain’s richest men who’s been inhaling and exhaling retail since he was a teenager. A high school dropout who sits atop a self-made fortune estimated at $5.45 billion, Green will be cohosting, with other major British retailers, a party to mark the 10th anniversary of London’s Fashion Retail Academy, the trade school he founded to help young people develop their skills and talents in the sector.
This story first appeared in the July 8, 2015 issue of WWD. Subscribe Today.
Not that Green, whose $4.22 billion Arcadia Group owns Topshop, Topman and a host of other high street clothing brands, was ever a model student: When former Prime Minister Tony Blair’s government first approached Green about starting a school, the answer was no. “Why should I build a school? I was useless at school. That doesn’t do it for me. What about if we build a fashion academy?” Green, 63, recalls telling Blair’s team.
When the time came to talk to the prime minister himself, he said: “This could be the shortest meeting of your career,” and the deal was done in five minutes.
“The building was already earmarked, so we agreed to buy it. We put in 10 million pounds, they put in 10 million pounds, and off we went,” says Green from behind a black glass table at his office a few minutes from the Topshop flagship in Oxford Circus.
Today, in addition to Arcadia, the academy counts Marks & Spencer, Next, F&F at Tesco and Experian among its main sponsors, and has trained more than 5,000 students in fields such as fashion retail, merchandising, buying and graphic design. Some 90 percent of graduates are employed, and this summer, the central London building will be expanded and refurbished to accommodate further growth.
Green, who’s dressed for a recent interview in a Gianfranco Ferré suit and white shirt as luscious as double cream, considers the academy, which has generated 128 million pounds, or $201 million, for the British economy, among his grandest achievements.
“You can’t suddenly get a great eye — to know that’s the right yellow, the right blue,” says Green, adding the buzz for him comes from finding “somebody who’s 18 and has a great eye and gets it, but who needs to be educated and taught how to buy and how the machine works.” He regularly takes students under his own wing to train them further at Arcadia and has even begun speaking to the younger ones, lecturing at high schools and middle schools in North London and offering them internships at the company.
The academy is one of myriad initiatives that helped Green to earn a knighthood from the Queen in 2006 for services to the retail industry — others include Topshop’s sponsorship of the British Fashion Council’s NewGen program for young talent, whose past winners include some of London’s hottest labels such as Alexander McQueen, Christopher Kane, J.W. Anderson and Mary Katrantzou.
Yet it’s the retail business — and the consistency with which Green has banked his profits and lavished them upon friends, family, employees and charities — that’s made him appear larger than life in the eyes of the British public. They’ve witnessed his rise from suburban Jewish kid flogging shoes, jeans and mass-market clothing, to the billionaire pal of Simon Cowell, the man Kate Moss and Naomi Campbell refer to as “Uncle Phil,” and the partner of Beyoncé Knowles in a joint venture with Topshop set to launch in the spring.
Green is a born entrepreneur with a ferocious intelligence, photographic memory — and a “disconcerting” ability to crunch numbers in his head, according to his close friend Richard Caring, whose properties include The Ivy and Annabel’s in London. In appearance, he resembles one of those Roman emperors whose profiles are found on rare coins, while in conversation he somehow seems utterly relaxed and irascibly impatient at the same time. His eyes never stop scanning a room, or a store floor, and he can act with utter bravado and certainty at one moment and the next shyly ask for approval, like a child seeking praise for an “A” on his report card.
Yet there is no questioning the numbers: Green’s old-style approach to business has translated into a personal wealth bigger than fellow fashion titans like Kering’s François-Henri Pinault and Hennes & Mauritz owner Tom Persson, according to the latest Sunday Times of London Rich List.
He’s achieved it all in an industry dominated by publicly listed behemoths — or well-endowed private ones. Through it all he’s remained an independent operator who prizes his freedom to shape and grow the business the way he wants. He has no aspirations to be the biggest, the richest, the man with the most stores. What he wants is respect — and for the businesses to keep growing. “Financially, we’re very solid, and at the end of the day we’re responsible for looking after people’s families — they’ve all got kids.” He won’t be drawn on his competitors except to say: “We’ve got to fight against them, haven’t we?”
“He’s not out there to please anyone but the customer and his investors — of which he, of course, is the largest,” says Millard “Mickey” Drexler, president and chief executive officer of J. Crew, who is a close friend. “He’s in a unique position in that regard: He is the managing owner and shareholder — the individual who created the business, sustains it and manages it, the last of a breed.”
For Green, the future is both about building out Topshop and Topman — the jewels in his Arcadia empire — and investment in start-up companies with a consumer bent. “Every single day, there are people looking to reinvent, in some way, the consumer experience. Look at the music business — look what’s happened there, the transformation. You cannot sit idly by. People are always going to go shopping — they like going to stores, they like shopping, but there are other things that are happening that you’ve got to be up to speed with. We’ve got to permanently keep progressing, improving,” says Green, adding that the consumer has never had more choice.
“You can sit in your house, you can shop an English brand, an American brand, an Australian one, wherever you want all over the world without even leaving your home. The choice of the consumer is unending as are the types of ways people are trying to sell.”
He says he’s looking closely, from the perspective of Topshop and Topman, at investments in “consumer-related online tech. It’s a place we’ve got to be in, it’s something we need to be doing. We have got to be a part of that next generation.”
Last year, he personally took a 25 percent stake in MySale, the publicly listed company that operates flash sale Web sites, for $80.9 million.
At Topshop, he’s taken pains to connect with a young generation through collaborations with Kate Moss, Kate Bosworth, Kendall and Kylie Jenner, and most recently the British TV and radio presenter Nick Grimshaw. He’s also ramped up the retailer’s digital offer, partnering with Facebook and Twitter for runway shows, strapping tiny cameras to models’ heads so viewers could see the catwalk from their perspective and allowing Oxford Circus customers to watch shows — including VIP arrivals and backstage — in a 360-degree virtual reality.
Green declines to give any specifics about future investments but says the company is ready to strike. “We’re in a unique position: We are a big private company, there is virtually no debt, and therefore we are extremely flexible in what we can do. We see a lot of things. If somebody showed up this afternoon with something we should buy or do or track, we can,” he says, adding that he plans to bankroll entrepreneurs from the academy. “Maybe we find a few people in there who can start a business, who have an idea. Maybe we’ll put up a challenge next term, maybe three or four kids, 3,000 pounds each, and start the matter there.”
As for his current business, Green says his approach is an old-school one: “I still think it’s down to great product. And we need to give the customer value, newness, and you’ve got to sell things. We need to have speed to market, availability, service, all of those things have got to be top-of-the-tree. There is no substitute for any of that,” he says.
Stuart Rose, the former chairman and ceo of Marks & Spencer with whom Green waged a fierce battle when he tried — and failed — to take over the company, says Green has been particularly savvy in an increasingly cutthroat market.
“The customer isn’t king anymore, the customer is master of the universe, and they’ve got plenty of other places they’ve got to go to now, the trick is to differentiate, and that is what Philip is trying to do, with Topshop, to make it unique. There are a lot of other successful punters out there — look at Primark and H&M — serious players with big firepower.”
Drexler calls Green “one of the great sourcing minds in our business,” and agrees that the Topshop product is a one-off. “I don’t think anyone has replicated Topshop at this point — it’s in his mind what the business is.”
Green — unlike the academy students he so passionately talks about — never had any training as a retailer. He began his career helping his widowed mother Alma (who died earlier this year), with her string of garages and self-service gas stations in London. Later, he began traveling regularly to the Far East, where he learned how to manufacture jeans and bought job lots, canceled orders, and end-of-line clothing, shoes and other goods to sell back in London.
In the Seventies, he asked his pal Joan Collins to cut the ribbon on one of his first London stores — a designer discount outlet on Conduit Street — and by the end of the decade he’d made his first million, thanks not only to fashion but to his knack for buying and selling commercial real estate. In the years that followed, Green met and married Tina, his South African wife with whom he has two children, Chloe and Brandon.
In 1998, Green tried to retire. He sold his various retail businesses and moved his family to Monte Carlo, where they are still based as tax exiles. But he quickly got restless, and made his retail comeback the following year when he bought the British retail conglomerate Sears, made a profit of more than $240 million by selling off various divisions, and used the money to purchase the ailing British Home Stores, which he re-branded BHS, and turned around in less than two years.
Earlier this year he offloaded the loss-making BHS for a nominal sum and debt-free to Retail Acquisitions Ltd., which is made up of a group of entrepreneurs, lawyers and bankers who formed the vehicle specifically to buy it. He said he’s dedicating the extra time to Topshop and Topman, which he’s rolled into the U.S. via a partnership with Leonard Green & Partners — where he’s shooting for $1 billion in sales and has expanded with shops-in-shop in Nordstrom; into China with e-tailing giant Shangpin, and into Hong Kong with Lane Crawford.
“We are doing very, very well in Europe and looking where the opportunities are, where we need to be, and more shop openings are on the table,” says Green. “The U.S. is a work in progress. We’re learning still. Our Nordstrom business is excellent and expanded, and Topshop and Topman are growing very, very well. I think we’ve got to learn a little bit more about each city and each local community, and where we need lighter weights, more casual and more formalwear.”
In 2002, he bought Topshop’s parent Arcadia for $1.3 billion, a move that catapulted him into the international spotlight and sealed his place at the height of Britain’s meritocracy.
“Philip’s talent is to see an opportunity,” says Rose. “His biggest opportunity was to buy Arcadia and that’s what has dictated everything else that has happened to him. That was the turning point from being one of a number of people to being much more prominent. The second turning point — which didn’t materialize — was trying to buy Marks & Spencer.”
Green failed twice in his bid to take over Marks & Spencer — most recently in 2004 — and earlier in his career, he was ousted as ceo of the publicly listed discount apparel chain Amber Day after a series of profit downgrades. It was his first — and last — brush with a public company and a major reason why he needs to do things his way — without following the drumbeat of the public markets.
Simplicity is one of his abiding mantras: He has no smartphone, and continues to use an old-fangled Nokia 6310 phone that launched in 2001 and has since been discontinued. (Green buys up the old stock, and keeps a stash in his office.) He never turns it off, returns his calls and prefers to speak one-on-one rather than text. He doesn’t do e-mail, either. Total waste of time, he says.
“I’m in the need-to-know business as opposed to want to know — and they are different,” says Green. “I need to know [certain things] to run my business, that’s why I’m not interested in waking up to 100 e-mails about something I don’t want to read about.”
He’s also adamant that his Arcadia staffers restore some basic human contact to their increasingly digitized day-to-day lives. “The minute they get in the lift they’re on these bloody machines,” he says. “I want to put a sign in the lift — ‘You’ve got to say hello, how are you? Did you have a nice day? Good morning, good afternoon.’ What’s happened to that world?” he asks.
The same goes for the students: “Working in shops, going to shops. I still believe that’s what people need to be doing,” says Green, who sends some of his academy interns on “mystery” shopping trips to check out what’s happening in the market place. “How are people shopping, do they know where they’re going, what are they going to do? It’s all about learning.” And, if you’re Philip Green, looking that customer straight in the eye.