Gerald Ratner: From Crap Peddler To Dotcom Millionaire

September 9, 2008

When I heard that Gerald Ratner had written an autobiography, my first thought was, “Who on earth would waste money buying more crap from that pillock?”

If you’re from the UK, you may remember that Gerald Ratner lost everything in 1991. His downfall began when the tabloids reported that he’d said the jewellery he sold was crap, whilst giving a speech for the Institute of Directors. The headlines included “Crapners” and “You 24 Carat Mugs”.

Ratners was the largest jewellery retailer in the world. And at the time of the speech they had 2500 shops, 27,000 staff, sales of billions per year and profits of £125 million. But Gerald Ratner is living proof that there is such a thing as bad publicity. And his foolish words cost him almost everything, including his £650,000 a year salary.

I didn’t feel sorry for Gerald Ratner. I’d bought jewellery from the stores he owned, so I thought he deserved everything he got. But something drew me to his autobiography and when I read the cover, I noticed it didn’t just say “The Rise and Fall”. It actually said, “The Rise And Fall and Rise Again”. Well that piqued my curiosity and here’s what I discovered about Gerald Ratner.

Gerald Ratner Was Responsible For The Rise Of The Family Business To Begin With

I’d always assumed that Gerald Ratner was a spoilt kid, who’d been given a senior role in the family business, just because of who he was. In fact, Ratner was an enthusiastic child, who left school with no qualifications at 15 years old and worked his way up from the bottom.

At the time, Ratners was nowhere near as successful as it became in the Eighties. At one point, the family almost lost the business altogether. But Gerald Ratner turned the situation round, because of his quick thinking and his ability to see the point of view of others – even those who’d betrayed him.

Ratner’s Success Could Be Attributed To Three Things

Throughout his autobiography, 3 things stood out that contributed to Gerald Ratner’s success:

1) He Was Passionate About The Jewellery Business: In fact, Gerald loved it so much that despite what happened in the nineties, he’s gone back into it and now he’s the largest online jewellery retailer in the UK.

2) Gerald Ratner Surrounded Himself With Positive, Successful People: It’s no accident that Ratner and his two closest friends – Michael Green of Carleton Communications and Charles Saatchi of Saatchi & Saatchi all became hugely successful in business.

3) Ratner Made Big Decisions Quickly And Believed Anything Was Possible: From takeovers of other jewellers, to venturing into the American market; and later, setting up his own health club from scratch, when he had no money, Gerald Ratner made decisions quickly. And he didn’t worry about how he was going to raise the cash to do those things, until after he’d made the decision. He saw opportunities, not obstacles.

If Gerald Ratner Can Start Again From Scratch – Anyone Can Do It

I assumed that someone with a business as big as Ratners, couldn’t go under completely. But after reading his story, it was apparent that Gerald really was skint, after he was thrown out of Ratner’s.

Four years later, Gerald launched a health club – remortaging his house and raising the remaining capital through outside investment and a bank loan. And in February 2001, that business was sold for £3.9 million.

The sale gave Gerald Ratner the money he needed to start an online jewellery business and in 2004, he launched It is now the largest online jewellery store in the UK.

Gerald Ratner Recognised The Importance Of Trends

Ratner never actually said he sold crap, during that unfortunate speech in 1991. But he did make two jokes, referring to a decanter his stores sold as “crap” and saying that a Marks and Spencer sandwich would last longer than the 99p earrings he sold. According to one publicist, he didn’t actually do anything wrong, he just gave an eighties type speech in the 90′s.

During the eighties, consumers wanted to buy cheap jewellery that they weren’t worried about losing. But today, customers are looking for better quality and good value. recognises that and it is reflected in the product range that Gerald Ratner offers.

Gerald’s lifestyle has also changed. In the eighties, Ratner lived a life of excess, with chauffeur driven cars and helicopters being the norm. His business also affected his first marriage, as he was always working and he eventually divorced from his first wife.

But today, instead of being chauffer driven around, Gerald cycles almost everywhere, on a superfast bicycle which will do up to 60mph. He works from home and instead of employing thousands of people, he deals with many aspects of the business himself, including replying to emails.

If you'd like to read Gerald Ratner's biography, you can get it here.
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What do you think of Gerald Ratner’s turnaround story? Do you think anyone could turn things round as he did, or would they need to possess certain traits?

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