JJB will struggle to survive, says Allsports founder
JJB Sports will struggle to survive unless it dramatically overhauls its offer, according to Allsports founder David Hughes.
Speaking to TheBusinessDesk.com ahead of a directors’ briefing held by accountancy firm Saffery Champness in Manchester last night, Mr Hughes said that he feels that the Wigan-based retailer is not presenting the right offer to the market.
“I wouldn’t want any business to go to the wall, but I don’t think JJB have got a clue about what the customers want, and that’s why they’re in trouble,” he said.
“They’ve had three goes in three incarnations in the last three years, and they keep getting it wrong.”
Mr Hughes, who is in the process of raising funds to set up his own multi-site retail chain, said that he feels there is still money to be made on the high street, despite the recent string of big-name retail administrations, but only for firms with a proper understanding of their customer base.
He praised JD Sports’ £20m acquisition of Blacks last week, describing it as “a great move” for the Bury-based retailer.
“JD’s buyers know what the customers want – JD will make a good job of that, in my opinion.”
Mr Hughes’s Allsports company was the fourth-biggest sports retail chain in the market until it went into administration in 2005, which he blamed on a combination of factors including personal illness, poor management and a division among shareholders when it came to a possible rescue.
“When I look at the High St now, anyone who is doing the job right is doing well,” he said. “The way you do it right…It’s a bit like Conrad Hilton said all those years ago when he was asked about hotels and he said ‘location, location, location’. Well in retail, it’s product, product, product.
“You’ve got to get your product right. you’ve got to put in front of people what they want to buy.
“When you talk about my ex-sector, JD are doing it right, Sports Direct are doing it fine at the bottom end of the market…JJB won’t be around in six months because they don’t know what the customer wants.”
Mr Hughes is currently involved in three ventures – a self-storage chain known as The Storeroom, online t-shirt vendor got-the-t-shirt.co.uk and the UK franchise for US storage business PODS – Personal On-Demand Storage.
The latter will open its second outlet in Salford next month following its launch in Leeds in December 2010. Hughes said that if the Salford business replicates the success it has had in Leeds then a nationwide roll-out could be on the cards.
He has also recently published a book detailing his experiences with his retail and property ventures, Dirty Business.
“I’m pretty gainfully employed. I’m not retired – I’m very, very firmly of the opinion that you use it or lose it. In every area of your life, you’ve got to keep it sharp and you’ve got to keep doing it, otherwise it stops. I see me working until I’m 90 because it’s what I enjoy.”
Mr Hughes is also looking to raise up to £20m for a new nationwide retail chain aimed at taller and heavier men.
“When I got into sport in 1977, it was because the sports retail market was totally fragmented – the biggest operator in the market had six stores, and yet, the forecast was that this market was about to explode. Right now, I think there’s another opportunity.”
He said that rising obesity rates, the overall growth rates for young men and bodybuilding trends has meant there is a demand for more outsize clothes.
“Put those combinations together, and nobody is catering for the bigger man. High & Mighty do it, but they’ve only got 14 outlets in the UK. Everything else is independent – just like the sports trade was 30 years ago.
“There is not a destination store for the big man – it doesn’t exist. Well, it’s going to exist, and I’m going to call it Man Mountain.”
