Oct 29, 2012

Rich Lister Jan Cameron’s big retail misadventure

Jan Cameron seems to have tried to run her discount retail empire like a side project. It’s been a terrible mistake. How could she have made such a big one?

At least Jan Cameron isn’t hiding from the collapse of Retail Adventures, her national empire of discount retail chains. "This will keep me off the Rich List, let's put it that way," she told The Australian in what is an extraordinarily frank account of the collapse. "I have often referred to this company as retail nightmares or retail misadventures. "Whatever happens, I was in charge when this was happening. I've got to take responsibility. I've made huge mistakes. It's been a massive learning experience. I didn't have a full understanding of this business." Cameron’s admissions are telling and the interview is worth quoting from at length. After reaping $250 million from the sale of Kathmandu in 2006, Cameron continued a largely reclusive life until April 2009, as the first wave of the global financial crisis ripped through the retail sector. When a discount retail group called Australian Discount Retail -- owner of the Go-Lo, Sam's Warehouse, Chickenfeed and Crazy Clark's chains -- fell into the hands of receivers, Cameron pounced, paying $85 million for the business. Knowing what we know now about what would happen to the retail sector over the next three years, it was a ridiculous price -- think of the big retailers that have since gone to the wall and have been unable to attract a buyer. But worst of all, Cameron appears not to have understood what she was buying. She didn't understand the discount end of the market and she certainly didn't understand what lurked under the bonnet of Australian Discount Retail, which she re-named Retail Adventures. "It is the cage-fighting of the retail industry – if all retail is warfare, this is at the guerrilla end of the scale," she told The Oz. "Outdoor retailing is a cakewalk compared to this." Discount retail might be a cage fight, but Cameron started with a pretty laidback attitude. Not only did she let others run the company, but she clearly believed it would be a pretty easy task, saying back in 2009 that it would be "a difficult feat for a company like this to lose money". How wrong she was. Cameron's first appointment was former Harris Scarfe chief Robert Atkins, who she now claimed had a "vendetta" against his former employer and was sacked for alleged s-xual harassment. A series of subsequent managers proved to be little better. "There has been a high level of resistance to change within the company; an unwillingness or inability to deliver the radical change that has been required," she said in the paper. "There was a really diabolical culture that existed in the company ... that ... I worked very hard for the last three years to root out. Some (staff) had a strange desire to run me out of money, thinking the company would get bought by the next sucker and they could continue on with their cruisy ways." Retail Adventures will live on as another company called Discount Superstores Group, which will run under "license" from Deloitte. Cameron is both an equity holder in the new group and the biggest creditor to Retail Adventures, having loaned the business $80 million. Exactly how that works -- and what happens to other creditors -- isn’t clear, but the net result is that 60 unprofitable stores will shut, with hundreds of jobs likely to go. Cameron claims shutting these stores will make the new business profitable from day one and admits she should not have tried to carry loss-making stores. That’s a fine admission to make now, when the business is in the hands of administrators. But how can a Rich List retailer, arguably one of the best in the country, make a mistake like that? *This article was originally published at SmartCompany

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6 thoughts on “Rich Lister Jan Cameron’s big retail misadventure

  1. zut alors

    Cameron’s comments are refreshingly candid. Remind me of the last time a CEO copped the blame without the usual ducking and weaving.

  2. Buddy

    I agree ziut… Refreshing honest and frank. Good luck to her I say

  3. Shaniq'ua Chardonnay

    I agree. Nice to see an upfront honest CEO

  4. Madonna

    James you asked :But how can a Rich List retailer, arguably one of the best in the country, make a mistake like that?
    Geez.. maybe she’s human after all! This is an opportunity to learn and do things differently.

    In my view,Jan Cameron is a marvelous business woman and role model for animal welfare and has the fortitude to turn things around…

  5. tim Inman

    For Jan to sit up in her tower and lay blame for her own inaction is rediculous. She had crediable teams that were willing to help her get this company to the number one spot. She herself ignored the advice. To say that the GFC had something to do with it is simply passing the BUCK. History does not lie. The original Clark’s Brothers started during the recession we had to have and built their empire quickly during the early nighties. And ask yourself! why is it that the younger brother has been expanding his buisness in the same market sector using the formula his brother started some 25 years ago. NO Jan don’t point fingers when most who worked their asses off to grow your business only to have you TEXT them your disappointment. Maybe if you cultured support as apposed to degredation of a persons spirt and love for retail; you’d have your 400+ profitable stores. By the way many of your senior managers where informing you of the poor performing stores 18 months ago. You were to busy saving the Tasmanian trees and putting people out of work down there! maybe you should start seeing the value in people.

  6. Tim Wood

    Well put Tim. It’s interesting that she comments on the companies “diabolical” culture. The culture at the company really declined once she joined. She arrogantly steered the business away from it’s core market, despite the advice of those that were in the buiness when it was succeeding. She put in place a team of her cronies and head hunters who set about undermining the current management structure and quietly removing those that didn’t obediantly comply.
    Then when sales plummeted, she blamed everyone with the exception of herself for the businesses poor performance?
    Yes, how brave of her to now concede she made mistakes and take responsibility. I’m sure it is cold comfort for those hundreds of people without a job as doors close around the nation.
    It’s interesting that her competitors in the same sector have enjoyed very profitable results and increased comp sales over her period of decline. What a marvelous business woman….

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