The very private Ryan: ThePost.ie


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The very private Ryan
Sunday, January 08, 2006 - By Ian Kehoe
Arthur Ryan's employees joke that he is a cross between the Invisible Man and television detective Columbo. Flanked by his personal security detail, he inspects his stores throughout Ireland and Britain wearing a rumpled old mac to protect his privacy. He keeps his head down and his eyes averted, leaving before his arrival has even been announced.

Only a handful of Ryan's closest colleagues would be able to pick him out of a line-up. Some have worked with him for decades but have never met him.

Others think they might have caught a glimpse, but can't really be sure. They know the name and the voice, but they don't know the face.

Meet Arthur St John Ryan, the intensely private chairman and managing director of Primark and Penneys. The man is so low-key that he refuses to be photographed and has never given a proper interview in more than 30 years.

Ryan's daily schedule is kept secret from all but his closest aides, and he frequently changes it at the last moment to avoid complacency. While most of his fashion contemporaries bask in the limelight, 70-year-old Ryan is happy in the shadows.

When fashion trade magazine Draper named Ryan as the most influential figure in British high-street fashion last month, the only image it could muster was an old corporate video that included a fleeting glimpse of the Dublin-born retailer.

Ryan has several reasons for his reticence. He is keen not to turn the company's success into an individual triumph. He likes the anonymity of dropping into stores unannounced and spending time on the shop floor, observing consumers in their natural habitat.

He is also acutely conscious of his personal security. According to sources, Ryan's constant fear is of being kidnapped and he takes all possible steps to avoid that possibility. His Dublin 4 house is reportedly one of the best-protected homes in the country.

“During the Troubles, a lot of prominent businessmen feared being kidnapped by paramilitaries,” said an associate. “Mr Ryan feared this more than most. He leaves nothing to chance. He has his own security guard and takes a lot of precautions.”

However, the success of Primark - which trades as Penneys in Ireland - is making it more difficult for Ryan to keep a low profile. The company has defied high-street gloom with buoyant sales and media acclaim, and Ryan is the man that makes it all tick.

In 1996, Primark had sales of €145 million in Britain. Last year, turnover at its 122 British stores reportedly topped €1 billion. Profits are equally stellar - it reported a 30 per cent rise in pre-tax profits last year to €203 million.

Growth in Ireland has also been strong, with 34 Penneys outlets believed to be contributing about 20 per cent of overall sales. The growth shows little sign of abating. Last February, the group snapped up seven Allders stores.

In July, it sealed the €600 million acquisition of 120 Littlewoods stores in Britain. Primark cherry-picked the best 41 for its own business, before selling off the rest to its competitors.

More than three decades after it opened its first English outlet, Primark is among the most popular brands in British fashion. Its strategy of buying in bulk and selling cheaply has won it a host of new customers more used to swiping their platinum credit cards in a Prada or Gucci outlet.

The company - with its motto of ‘Look good, pay less' - is selling clothes that look and feel like designer garments at a fraction of the price of the ‘real' thing.

According to the retail market group Verdict, nothing in Primark's British stores costs more than €25.

Its range of clothes is in vogue, and in Vogue. Primark's military jacket (€17) appeared last year in the pages of the glossy fashion bible next to a very similar jacket from high-end Italian designer Balenciaga (€1,172).

Within weeks, the Primark version had sold out and was trading on eBay for twice the price. “The customers are coming back to us week in, week out. No gimmicks,’' Ryan said in a promotional video for Primark's parent company, Associated British Foods (ABF).

ABF is a food and retail conglomerate owned by the Weston family. Indeed, it was Galen Weston, the Canadian billionaire whose interests include Brown Thomas, who poached Ryan to help launch and then run Penneys in the late 1960s.

Ryan had previously worked for London fashion wholesaler Carr & McDonald, before returning to Ireland to work for Dunnes Stores at Cornelscourt in south Dublin. With finance director Paddy Prior, Ryan opened the first shop on Mary Street in Dublin in 1969.

Their model was for a fashion chain for under-35s, offering fashionable products at rock-bottom prices. In 1974, they took the model to England, opening a store in Derby. It was named Primark to avoid legal issues with the American chain JC Penney. A fledgling empire was born.

“Ryan has retailing flowing through his blood,” said one former colleague. “His model has been copied by a host of other companies, but it has never been equalled.

“He was really ahead of his time.”

Another associate said: “He knows every inch of every store. He tries to visit each store every fortnight. He knows what everything costs, what is selling and where it is coming from. He knows all this because he makes those decisions himself.

“He is very hands-on.”

Ryan's management team is lean and effective, if slightly ageing. Joining Ryan and Prior in the “gang of four'‘ are marketing and human resources boss Breege O'Donoghue and operations director Seamus Halford. All are over 60.

Store managers at the group have direct phone access to senior management.

There is no middle layer of bureaucracy and decisions are made and implemented within hours. If something is not selling, it is removed from the shelves with little fuss or fanfare.

“If we don't like it, we get rid of it,” Ryan said in the ABF video. “We don't have annual sales because we don't hang around waiting for January if we have a problem in October.’' Nor does the company advertise.

Its entire PR budget is believed to be less than €15,000 a year, most of which is spent on regional newspaper ads before a new store opening. The company generates press from its low prices and staggering growth, rather than flashy advertising campaigns. “Primark is an extension of Arthur Ryan,” said one retail source. “It is successful but low profile.

“His competitors are spending a fortune building up a brand and he just goes about his business quietly. The company is an absolute wonder.”

While Primark has soared, its competitors have struggled. French Connection recently said that underlying sales were down 9 per cent. Next, which has 400 stores and a catalogue business, has just announced its worst performance in a decade. BHS issued a profit warning in November.

The key to Primark's success is its buying policy. The company has a team of buyers who import directly from places such as China, Hong Kong and Taiwan.

The astute buying policy enables Ryan to deliver a 12.5 per cent profit margin.

Although the firm's choice of partners is frowned upon by the ethical business lobby, it has allowed Primark to corner the market in cheap, affordable fashion.

One story tells of how Ryan was approached by a factory owner with a product costing stg£5 that would sell for stg£10. Ryan reportedly told him he was not interested unless he came back with a product that cost stg£3 and could be sold for stg£7. “I don't care how you go about it - just do it,” he said.

Ryan is an old school retailer. Senior managers in the business are referred to as Mr or Mrs, and he spends as much time as possible away from the boardroom.

“Slightly quirky but utterly brilliant,’' was how one associate described his management style.

Ryan may be passionate about his privacy, but he is not a recluse. He is described by friends as gregarious and great company. He looks far younger than his 70 years and is always immaculately attired and groomed (although he is rumoured to turn up to his office in socks without any shoes).

He is a keen sports fan, and is friends with former Republic of Ireland boss Mick McCarthy, who has officiated at the opening of a number of Primark stores.

He is also reported to be a fine tennis player, and has a passion for history.

He is a friend of retail billionaire Philip Green and the pair meet and dine regularly. In 2003, when Green was under fire for allegedly making anti-Irish comments, Ryan sprang to his defence and issued a rare public statement proclaiming Green's virtues.

As well as his devotion to Primark, friends said Ryan was a committed family man. He is married to Alma Carroll, a cabaret singer who finished third in the 1977 Eurovision song contest.

“It would be a mistake to describe him as a hermit,” said one associate. “Just because he does not want his picture in the paper does not mean he is a recluse.

“He is wonderful company and acts about 20 years younger than he is.”

However, Ryan's advancing years are raising questions about the future leadership of the company. ABF has yet to reveal a succession plan for Ryan and his three lieutenants, although it is understood the company has started to implement one. There has been speculation that the Littlewoods deal was Ryan's swansong, and that he will retire once the acquisition is fully integrated with the Primark Group. Ryan, however, has shown little sign of easing up and continues his punishing schedule of store visits.

Next on his agenda is Spain, where the group will open a 24,500 square foot store at Plenilunio, near Madrid, in March. This will be followed by a store at the nearby Xanadu centre and the company is also believed to be looking at opportunities in Portugal. “We believe in ourselves,” said Ryan. “You go back to ten years ago, if someone said that Primark would be the player it is today, they would have been very hesitant . . .but we came through and we forecast certain things in the trade, me and my colleagues, that have been delivered.”

For example, when ABF sold Quinnsworth and Stewarts supermarkets in 1997, it was Ryan who convinced the Weston family to retain the clothing chain. The growth, he said, would come through value fashion and the under-35 market. His prediction was oracle-like.

Whenever the Invisible Man of high-street fashion eventually decides to hang up his mac, he will be a hard act to follow.

Stellar growth, overseas expansion and the darling of fashion aficionados - all this, while being virtually anonymous in his own stores.