Gary Grant, the retail industry’s Santa Claus, tells Retail Week that he is doing his best to have a merry Christmas despite enduring the most challenging year of the past decade.
Gary Grant is used to playing Santa with parents flocking to his toys stores every December. This year, Christmas couldn’t come soon enough after “one of the more challenging years in the last 10”.
However, he believes the certainty that the new majority government brings bodes well for another good Christmas at the nation’s largest toy retailer and will finally get shoppers that have been “sitting on their hands” this year spending.
“The uncertainty about will we, won’t we, possibly has gone away,” he says.
Much like St Nicholas, Grant’s days get busier in the run-up to Christmas – in fact, the toy retailer usually makes 8% of its annual sales the week before Christmas. However, this year he expects this figure to rise this year now that the political uncertainty has been lifted following the general election.
That’s not to say The Entertainer has had a slow start to the golden quarter. Black Friday was “excellent”, Grant says, though he admits it has brought logistical challenges.
“Late last week, we only started to recover from the sheer intensity of the orders that we received. Our warehouse is now on top of it, but it’s taken us two weeks to catch up.”
With Christmas around the corner, Grant’s next challenge is making sure the retailer has enough logistical capacity to deliver everything it sells over the next seven trading days.
“We’re always up for a challenge,” he says.
A challenging year
That’s clear to see. Despite the challenging time on the high street, The Entertainer has bucked the trend as sales and profits have been soaring. During the first half of the year, it registered a 25% jump in total sales and a 12% rise in like-for-like sales.
However, Grant believes Brexit has quelled demand across the entire retail industry over the last year. “Then Brexit morphed into a general election, so there’s been a whole number of reasons why [customers] decided to just put things off,” he adds.
Despite the challenging times, Grant says The Entertainer has weathered the storm and is still on a “fast growth track in the UK”.
It is now the UK’s largest specialist toy retailer since Toys R Us collapse in February 2018. Mothercare followed suit, hitting the buffers in November, and is in the process of closing all of its stores, leaving The Entertainer as one of the last traditional toy retailers standing.
“There is absolutely no future in signing up shops because the whole system is bust and not fit for purpose”
Gary Grant, The Entertainer
And it is still growing rapidly. It acquired toy brand Early Learning Centre (ELC) from Mothercare in March for £13.5m.
Like The Entertainer, ELC is over 30 years old and have been used by generations of families – something in line with Grant’s traditional values.
Alongside the ELC acquisition, The Entertainer has continued to develop its own range of toys, Addo, to offer customers something different to other retailers and giving them better value for money.
It’s not just at home that The Entertainer has been growing. It acquired Spanish toy retailer Poly this time last year for an undisclosed sum and has spent the last twelve months integrating the 57 shopping centre and high street stores into its business.
Business rates halt UK expansion
Despite this growth, Grant is firm that The Entertainer will not be opening any more UK stores for the time being due to the burden of business rates.
Grant believes that government action is needed urgently on rates to stimulate store openings and prevent further retail collapses.
“If the government doesn’t do anything they’re going to end up with closed shops. My rates in my main internet warehouse as a proportion of total sales is 0.8% and the store in Westfield London is 4.8%,” Grant says. “If I wasn’t in Westfield today, at that level of rates I probably wouldn’t be in because it’s just not sustainable.”
“There is absolutely no future in signing up shops because the whole system is bust and not fit for purpose. The need to act quickly or business rates will be the nail in the coffin for [some retailers].”
The toy tycoon conversely says that landlords have been very open to negotiating reasonable rents.
“Landlords are being very, very flexible with leases, turnover related rent they are doing everything. You can negotiate with a landlord; you can’t negotiate with the government.”
Grant adds that “excessive tax on retailing” is “utterly, utterly stupid”.
“If you look at the taxes you have to pay to stay in business it’s just not sustainable, so the easiest thing we can do is sit on the fence as it will be survival of the fittest over the next 24 months,” he says.
Although Grant believes the next couple of years for retail will be challenging, The Entertainer appears to be in safe – if cautious – hands.
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