'How I'll make Pick n Pay tops'
New Pick n Pay chief executive Richard Brasher wants the retailer to regain its position as South Africa's market leader.
If new Pick n Pay chief executive Richard Brasher was a gambler, he would be in the right place. His new office overlooks the Kenilworth racecourse in Cape Town with a bird's-eye view of the final straight. And succeeding in his new job – to return what was once South Africa's leading retailer to its pole position – may also have to rely a bit on the roll of the dice.
Pick n Pay has fallen from its place as a consumer's friend to a consumer's fiend, resulting in declining turnover, profit and market share. It is now no longer the leader, but rather an also-ran to Shoprite Checkers, faces stiff competition from Woolworths and will have to contend with Massmart stores when Walmart really gets going.
But Brasher, who is English and the former chief executive of Tesco in the United Kingdom, seems more methodical and considered than rash and brash. He has 26 years of experience at the British retailer, eight years on its board and some knowledge of leading from the top, albeit for only a year.
Brasher left Tesco in March after a conflict with Philip Clarke, his boss and chief executive of the entire operation, mostly, he said, over the pace of investment required in the British business. "The UK business is an outstanding part of Tesco's business and accounts for 70% of its profitability. There was no difference in opinion between us over strategy; just a difference in how fast we needed to invest in the UK business. There was room for only one captain."
He had not intended to get another job so soon but, at the age of 50, knew "I had another big job in me". Eight weeks ago, he received a phone call asking him if he would like to meet Pick n Pay founder and "consumer's friend" Raymond Ackerman. By the time he got home after the meeting, he knew that leading the South African retailer was a good idea.
"I wasn't planning on getting back in the saddle so soon, but I got excited about running a business on a different continent," he said.
"I always say to people I interview that after the first interview they will know if the job is right or not. I felt right about this from the beginning."
Brasher must have got on with the Ackerman family, Pick n Pay's largest shareholder, who will naturally be concerned that its new leader will do a good job. Although Brasher pointed out that Pick n Pay was a public company and his appointment was made by the board, he confirmed meeting Ackerman family members before his appointment. "They had a say, but it was a board appointment."
Brasher, who is perhaps understandably noncommittal about his plans for Pick n Pay when he starts in February, will say only that he is "listening hard and learning fast".
In his research before taking the job, he found a competitive market in which Pick n Pay was not leading as it had in the past. "But I like competition; it is a good catalyst," he said. "I would like Pick n Pay to be the leading retailer once again. It is a good brand which has a rich heritage and a strong past."
He also likes the fact that, unlike the UK, South Africa is a growing economy on a continent that has seven of the 10 fastest-growing countries in the world.
Alhough Brasher spent most of his career at Tesco in the UK, he said there were similarities in retailing in all countries around the world.
"There are a number of things which are the same and those are good prices, service and products. Where things vary in different countries, is the way people live their lives. In South Africa another variable I have noticed is the diverse customer base which Pick n Pay serves."
Brasher said he was not unfamiliar with other countries because Tesco's international business operated in locations as diverse as Thailand, China and Poland. "No matter where a retailer is located, it really just needs to meet customers' needs."
Brasher believes being a good retailer – and leader of a retail chain – means having a clear direction, and understanding and respecting the different parts of the business.
Role of management
"Running a shop is very different to what happens at head office. The majority of the workforce, not management, represents the brand in the stores. The staff who work with customers will be the people who define what customers think about the brand." And keeping prices down is another way to win customer loyalty. "We have to search the world for the best products and prices."
So what happens if staff are rude and grumpy, as Pick n Pay staffers are accused of being by some shoppers? Brasher said he would have to listen to people in the organisation to see what they say. "In my experience, people prefer to do good work rather than perform badly. The role of management is to help them."
Starting in 1987, Brasher's experience at Tesco included buying, marketing and working in food and non-food items as marketing and commercial director.
Pick n Pay chairperson Gareth Ackerman said in an emailed statement: "The search for a new chief executive was exhaustive and global. Of every candidate we considered, Richard had the experience, expertise and willingness to take on the task that made his appointment the best possible one for us at this time in our history. To be able to secure as chief executive a 26-year retail veteran with virtually unmatched experience handling the very things we are grappling with puts us in a very good position into the future."
Brasher might be able to use some of his experience with Tesco's Clubcard, a loyalty card that Pick n Pay tried to emulate with its smart shopper loyalty programme, which has cost more than expected. Or he may be able to help Pick n Pay with its lack of a centralised distribution system, or with its online shopping offering. But will he be able to manage the retailer's staff problems and South Africa's labour laws? And will he use the old method of cost-cutting to make the numbers look better?
Brasher denies being a cost-cutter, describing himself as someone who "tries to create value for staff, shareholders and customers. If I can find a simpler, better and cheaper way to do this at Pick n Pay, we will find ourselves in a better place."