Sir Ken said today that he will finally step down as chairman of the supermarket chain he has built into a household name. And after a traumatic few years following its acquisition of Safeway in 2004, he’s leaving just as his business appears to have turned the corner. Morrisons said today that its profits soared by two-thirds last year to £612m, and promised to return £1bn to shareholders via a share buy-back. That’s the kind of cash-back all supermarkets should provide.
Morrisons looks in pretty good shape at the moment. At a time when most supermarkets are stumbling, sales were up 6% to £13bn, including a 4.6% rise in like-for-like sales. What’s more, it’s pinching customers off Sainsbury, Asda and Tesco – even outside its northern heartland.
It’s been a good innings for Sir Ken. He took over the family business in 1952 aged 21, and six years later opened his first city centre shop in Bradford. Fifty years on, it’s the fourth-biggest supermarket chain in the UK with nearly 400 stores across the country. He’s always been a hands-on boss – and is well-known for imposing his own ‘thrifty’ approach on his staff. Apparently he used to root through the bins at the back of his shops after closing time every day, to make sure that his managers weren’t throwing away too much fresh stuff (count the pennies and the pounds will add up, as your Gran might say).
Of course it hasn’t all been plain sailing. He came under severe pressure following the Safeway takeover, eventually caving in to demands from the City to move upstairs and bring in a new chief executive. But like all good leaders, he seems to have made the right choice, handing over the day-to-day operations to ex-Heineken man Marc Bolland.
History might also prove that he’s pulled off another good leadership trick - getting out at the right time. Bolland admitted today that the market was likely to be ‘challenging’ this year, and said that prices would be rising by up to 2.5% to reflect higher commodity costs. What’s more, last year’s success followed a very difficult 2006, so today’s figures are being compared against a low base. It will be a lot harder for Bolland to maintain this progress in the coming year.
We’d like to think that as Sir Ken kicks back with a nice cup of tea and enjoys his retirement, such concerns will be far from his mind. But to be honest, we doubt it.