Were BHS Simply Not Good Enough?
When BHS went into administration earlier in the year, it was definitely a shock to many. It seemed like the well-known department store had been around since time began (90 years ago to be exact) and believe it or not was still immensely popular with the Great British public right up to its dying day. Following the BHS administration was a storm of media accusations, with accounts from ex-staff speaking of their devastation now that the company’s bankruptcy has threatened their pensions, with 20,000 hard earned investments having to fall back on the national protection scheme. BHS’s demise is a slow one, and it has become known for it’s £571m pension deficit, with the deficit outweighing its assets plus numerous other nightmarish figures, poor old BHS has been left in a sorry state and is an unattractive investment for any buyer, leaving it pretty much unwanted. But once the place to be for fashion, household items and yeah, pretty much everything, where did it all go wrong?
With Scottish stores all being closed down, this weekend has truly marked the end of an era. With an epic closing down sale, including the shop’s fixtures and fittings, BHS ended its service to the Scottish public. Whilst it may be a moment filled with nostalgia for many, for the 500 staff that are now jobless, there is a terrifying uncertainty for the future. It has been reported that the problems began when BHS owner Sir Philip Green sold the business, which at the time was described to have been ‘on life support’ to racing car driver Dominic Chappell for £1. The sorry state that Sir Phillip had left the business in, meant that there was nothing left to fund worker’s pension. He has also shockingly been accused of giving a large sum of the company’s fortune to his wife, who lives in their tax haven. He cleverly passed on the company to a naive Dominic Chappell, when he knew it was failing. But, when all is said and done, is the management surrounding BHS solely to blame for the collapse, or could there be other contributing factors?
Out of touch
Reports that BHS had a diminished market anyway has been taking the heat away from the fact it was poorly managed in financial deficit. In the same way that many businesses go under, its competitive rivals were simply offering something more attractive to the public. Sir Philip, admittedly, could have attempted to update the market so that it stood a chance against the likes of Primark and school uniforms offered by Tesco and Sainbury’s (Everyone remembers BHS for its school uniform) but choosing to neglect the business meant that it didn’t stand a chance in competing. Big department stores are no longer doing as well as they once were in town centres, which is where the majority of BHS stores were situated, with people preferring to go to out of town shopping centres and malls to do their shopping. BHS, as a store and as a brand, oozes tradition, the traditional two-storey department store that is situated as the main building on the high street of a town centre. As time has moved on, there is no longer a demand for this type of store, not only due to out of town shopping centres but also due to online shopping. Just recently, experts have revealed that soon our online orders will be able to be delivered by drone, making for a fast, cheap and easy delivery, probably from online stores that are offering cheaper alternatives than BHS were anyway (the internet is a great place to allow for price comparisons and finding cheaper alternatives). A retail expert at Stirling University has reported that the two-story high street stores (also operated by the likes of Marks and Spencers and Debenhams) are becoming the hardest to fill, as shoppers in a rush don’t even leave the ground floor. BHS did indeed suffer the effects of times changing, until they could keep up no longer. At the end of the day, the footfall for town centres and traditional shopping cannot be revived by anything other than the public.
‘The Unacceptable Face of Capitalism’
The person that has come under fire most for the demise of Britain’s much-loved department store is Sir Philip Green. His company, Arcadia group, bought the store in 2000, but last year sold it for just £1, after it had totally fallen under. Not only has he now been discovered for leaving the pension sector entirely unfunded, he has also been scrutinised in the news for telling staff he ‘owns them’. A lady in the Hempstead store was spoken to this way by Sir Philip and believes it is a real measurement of the kind of person he really is. Dubbed the unacceptable face of capitalism, there are even calls for Sir Philip to be stripped of his title, unless he pays out money for the pensions he has been accused of stealing from. it is arguably his duty to resolve the pension deficit that he left the business to deal with themselves. Financial matters aside, the last of the BHS stores are due to close their doors at the end of the month, and so if you are looking for a bargain (or an emotional goodbye), it could be worth a trip to town. All stock must go.