By constantly investing in his four department stores in Northern Ireland, Jersey and north Wales, Neville Moore is ready for an independents’ revival.
HOW WOULD NEVILLE Moore respond to the many commentators who declare that the department store is dead?
“I’d have to say that is an uninformed view,” says the quietly-spoken owner of the Ulster Stores group, which runs a quartet of department stores from Northern Ireland to Jersey. “Some department store businesses – such as House of Fraser and Debenhams - have been allowed to become irrelevant to their local customers. Like many high streets, they offer homogenised retail that displays no point of difference, but I can see retail going back to a time of independents and more individual department stores offering something unique that reflects the needs of their local community.”
A well-publicised problem with the larger store groups is that too much money has been taken out over the years through financial engineering and too little spent on reinvesting in the physical space, ranging and people. This is not a charge that could be laid at Neville’s door. All four of his stores have benefited from an ongoing programme of improvement that literally will never end. There will always be something to do. “We own all our freeholds, so we can invest in confidence that we will see the benefit,” he says. “Particularly with Moores in Coleraine and de Gruchy in Jersey, we see them developing even more as community stores, reflecting the needs of their respective locales.”
The group is an intriguing mixture of four different stores that share several common attributes. The original business, Moores of Coleraine in County Londonderry, was found-ed by Neville’s grandparents in 1925, when they bought a small drapery shop in the town’s main street. Today the business occupies 42,000sq ft of selling space over three floors. In 1972 The White House, a department store opened in 1891 in the nearby seaside resort of Portrush, was added. The 30,000 sq ft building is currently undergoing a £600,000 refurbishment programme that will see its façade refurbished and the 10,000sq ft ground floor improved. In 2002, Neville bought Clares of Llandudno in north Wales, a 12,000sq ft store dating back to 1927, from the grandchildren of the founder.
Underlining his personal belief in the future of traditional department stores, in 2006, Neville acquired de Gruchy in Jersey, which at 55,000sq ft trading space is the largest and the most upmarket in the group. Neville explains some of the reasoning behind the deals: “The White House is only seven miles from Coleraine, so it was easy for us to manage and obviously we knew the local market. I liked Clares because it had similarities to us, being a well-established family-owned concern. Like Portrush, Llandudno is a seaside town that is busy in the summer and at Christ-mas, so we were used to that trading pattern. de Gruchy benefits from a seasonal tourist trade but is also a very busy all-year-round business , which includes financial services.”
None of the businesses was the finished article when acquired. At Clares, turnover was quickly doubled, largely by adding clothing, a category Moores knows a lot about. Last year Neville paid £250,000 to buy out a long lease on part of the property that he did not own.
Some £15m was spent at de Gruchy, mainly on a major refurbishment created by leading retail design agency Caulder Moore. Moores itself was given a mini-makeover in 2013.
Despite the geographical spread, the business operates with a centralised management team based in Coleraine. Since 2005 the offices and warehousing has been on an industrial estate to free up space in the store. de Gruchy was brought into the centralised structure in 2009. The management team is small, with Neville backed by a finance director, an HR/operations director and a buying/online director and de Gruchy store director. On the shop floor Simon Colquhoun is general manager of Moores, The White House and Clares. To complete the senior team, a marketing manager with a background in social media is being recruited.
“Having a centralised structure has allowed the business to have the best possible people in the right jobs,” says Neville. “While the challenges are broadly similar across the group there are local idiosyncrasies, so central buying is not the same as common range planning. Product mix and pricing architecture is adjusted for each.”
The formation of the group in 2006 came just before the financial crisis of 2007-2008, an economic collapse that was deeply felt in North-ern Ireland. “We’d seen house prices rocketing in the previous period and, as the saying goes, the bigger the boom, the bigger the bust. I’d say it’s only in the last few years that Northern Ireland has fully recovered,” says Neville. A challenge now is to maximise opportunities in today’s demanding trading conditions. In this, Neville and the team put a lot of faith in their 420 staff members. Three years ago, the company started to involve a much wider cross-section of people from each part of the business in the annual strategy day with the aim of more devolved authority at store level and the results have been very encouraging.
“Although we buy centrally and have central services, we recognised we had to change operationally because the customers had changed. We have gold dust in our team and at the last strategy day when we asked the business for ideas about what we should do differently, we received a brilliant response. Eight out of the ten main suggestions were instigated immediately. We have changed the way we work in several areas, trying to use lean techniques back-of-house to free more resources for the customer-facing side. It is a challenge to keep appraising yourselves, but the alternative is stagnation or worse.”
Also prompting self-examination was the stores’ service proposition – what is their USP? “Internally, our former stated aim was to be ’the most customer-engaged retailer in the UK’. While that was a worthwhile target, people wanted to know what that meant and which KPIs (key performance indicators) we had to hit to achieve it. Our refreshed purpose, which was agreed following a poll after the last strategy day, is much simpler - To Make Every Customer Smile,” says Neville. “A smiling customer is a happy customer, it’s memorable and easy to understand.”Part of the stores’ response to the currently universal problem of declining footfall is to hold WOW days four times a year. Linked to raising money for local charities, these are marketing events packed with activities for all the store’s customer groups. The pre-Christmas event in Coleraine, for example, has the local radio station broadcasting from the store. Neville is quick to stress, however, that price-cutting is not part of the attraction on the WOW Days: “These are not discounting events – we need margin to survive – but they remind people we are here and encourage them to come in.”
In a related move, last October the group instigated a year-long skills development programme in which six people with the potential to develop each work with a mentor on their development plan. “We have got to recognise and nurture our own talent,” says Neville.
While many large department store groups have suffered from falling under the control of financial speculators rather than retailers and natural traders, the four owned by Neville Moore benefit from his 40 years of experience in the trade. The third of four siblings, he admits he never wanted to do anything but work in the family business. He started when he was 16 but his father John insisted he completed his formal education at the local college, where Neville secured a BTEC in Business Studies. He recalls enjoying the buzz of retail and says he especially loved dealing with people and marketing. In the classic manner, Neville worked in all the store’s departments. His entrepreneurial spirit is a family trait.
Back in the mid-1920s, Neville’s grandfather William died unexpectedly, leaving his wife Rebecca to run their recently-acquired drapery shop as well as looking after three young children. A clever buyer, she visited Belfast wholesalers on Thursday, the store’s early closing day, to buy new stock for the weekend trade. Neville’s father John joined the business at the end of World War II and displayed his own trading acumen by advertising in the London Times skirt lengths of redundant parachute silk. He commenced acquiring neighbouring buildings to extend the store premises and was actively involved in the civic life of Coleraine.
The Moores’ deep roots in the community is celebrated in a display of archive material on the walls of the ground-floor cafeteria. One of the most striking images is of the store engulfed in flames on the night of Friday 13 November 1992 after a huge IRA bomb exploded at 10.45pm and took out an entire block of Coleraine city centre. The family had invested considerably in the premises, including installing a new lift, and the newly-refurbished store had been open for only seven weeks. Even 27 years later, Neville finds it hard to put into words the full impact of this cataclysmic disaster, which destroyed not only the building but all the company’s records. Just six weeks before Christmas, for example, all details of the 1,000 or so members of the store’s Christmas club were gone. The business received remarkable support from suppliers, the AIS buying group and the local community. Moores managed to keep on trading from a small hut at the back of the site. A new store of 42,000sq ft was constructed to replace the lost store of 28,000sq ft. There was some government compensation but no insurance and Neville acknowledges that it was a massive strain, both financial and human. Sadly his father passed away just before the store fully reopened.
Such a terrible experience puts general trading difficulties into perspective. Neville regards the future as both a challenge and an opportunity. Getting the product mix right is crucial and the business is increasingly ready to recycle brands or categories that are not providing the required margin. Fashion is an important category and a large driver within Moores with 45% of store sales, a mixture of own-bought and concessions. Neville explains. “We like concessions if they are right, but there is less visibility around the long-term future of some concession operators such as Arcadia (Miss Selfridge, Wallis and Dorothy Perkins) but we have always been good at managing changes in the market place. In 2010 10% of our group womenswear sales came from brands like Dash, Jacques Vert and Precis, which are not in the market anymore. We used that as an opportunity to reposition ourselves and they have been replaced with more aspirational own-bought brands and more relevant concession partners.
“While fashion sales have been affected by the poor spring weather, overall we have performed quite well so far this year. One benefit of a department store is the spread of risk. Categories such as homewares and luggage are examples of people spending on homes and experiences, such as travel. Areas of cookshop are doing well and the growth in coffee means we are selling expensive coffee makers these days. “New beauty brands are creating more excitement than fashion and to catch the wave we have added Bare Minerals and Benefit as branded counters and Rituals to our own-buy.” One area under review is online. Moores has had a transactional website since 2010 but, like many other independent retailers who offer only widely-available third-party brands, Neville is struggling to find a way to make the activity profitable.
While Moores is very much a traditional family business, since 2006 it has been 90% owned by Neville, who bought out two of his siblings and left a third with just 10% of the equity. “Generational succession is a regular issue for family businesses and we had seen how this had been handled by other AIS members”.
While it is early days, his children Jessica, 23, who is working to become a chartered accountant, and John, 21, who is finishing university, have both spent time in the business through school holidays. Reviewing his own four decades in the business, Neville says with a smile: “The old joke about family businesses is that the first generation starts it, the second one grows it and the third one blows it. I think I can say that I have avoided that so far.”
- MOORES OF COLERAINE - 9-11 Church Street, Coleraine, County Londonderry BT52 1AN
- THE WHITE HOUSE - 45 Main Street, Portrush, County Londonderry BT56 8BN
- CLARES - 97-99 Mostyn Street, Llandudno, Conwy LL30 2PD
- DE GRUCY - 50-52 King Street, St. Helier, Jersey JE4 8NN
Bira member: "since the BSSA days".