Clarks: Made to Last

by Mark Palmer

  Closing work, 1950.

  It spelled out the terms and conditions of employment, making clear he would be joining the Staff Pension Scheme – an ‘expensive scheme that can only be maintained at its present level in times of good profit earnings’ stressed the letter. His pay rose to £15 a week in 1962 and his appointment was subject to one month’s notice on either side.

  Patricia Andrews, who would become his wife, also worked in the factory, as did her father and as would Maurice’s and Patricia’s two daughters. In the November 1952 issue of the company’s News Sheet, there is a picture of Maurice and Patricia on their wedding day, standing outside the Street Methodist Church.

  ‘It was a sociable sort of place. My wife and I did most of our courting in the factory,’ says Maurice. He continues:

  Our manager was Peter Clothier and there were a few times when he turned a blind eye to what we were up to. We all used to work 8am to 6pm and on Saturday mornings. But to tell the truth, we never really started working much before 8.30am because there was a lot of chat to sort out first. Once you went on staff you pretty much had a job for life and that was the important thing. The feeling on the factory floor was that everything was alright while the family was in charge but when the outsiders started coming in they were desperate to show how brilliant they were – and things changed.

  The company’s 125th anniversary was celebrated in June 1950. Every member of staff was given a commemorative silver spoon in a little green box and a party was held in the newly opened Grove factory in Street, enlivened by the Sydney Lipton orchestra from London, which specialised in dance hall music. No alcohol was consumed – on the premises at least. Maurice Burt didn’t go because he was unattached at the time and felt awkward attending on his own.

  Peter Lord Ltd opened its fortieth shop in December 1952 in Tunbridge Wells, and the actress Yvonne Marsh was invited to cut the ribbon. This outlet was seen as a template for modern retail design, with its large glass doors and glass-fronted displays at the entrance, showing off as many lines as possible. The ‘Women’s Fitting Room’, as it was called, was on the ground floor, children’s and men’s on the first floor. While having their feet measured, children were given a teddy to cuddle and sat on a chair that looked like a big drum. The message to shoppers was that Clarks represented affordable high fashion, and that Peter Lord sales staff were knowledgeable, trustworthy and always on the side of the consumer.

  Bancroft described the Peter Lord shops as ‘testing consumer reaction to our merchandise and to our methods of sale and promotion’, but he also put out a statement to all sections of the trade in 1953, reiterating the company’s commitment to the independent retailer and stressing that Peter Lord – which three years later would open a shop in Regent Street, its first in the West End of London – accounted for only 10 per cent of Clarks sales. Maintaining a balance between building up its own Peter Lord retail chain, while not antagonising the independent stores that sold Clarks, was a delicate task. He wrote:

  The showroom at Mitre House, the Clarks London office in Regent Street, in 1950.

  We must always bear in mind the tremendous advantage the independent retailer has over the multiple retailing organisation … we also believe that as manufacturers we have shoes the public want, and we know that we have a knowledge of advertising and style to enable them to maintain their favour with the public. We … believe in the independent retailer, those shops which absorb the major part of our distribution; and we feel sure that our policy of relying upon the independent retailer and the departmental store as the main outlet for 90 per cent of our pairage is a good one because it compels us to continue the healthy fight of competition in matters of style, quality and value offered.

  But the world of shoe retail was about to be shaken like never before. Bancroft was not the only one who thought that footwear in Britain was a potential honeypot. Charles Clore was on the prowl, his prey waiting quietly, invitingly, on every high street in every major town and city and in many smaller ones as well.

  Clore was the son of Israel Claw, a Russian Jew born in Kovno, Lithuania, who brought his family to London in 1888. Israel’s first job was as a cobbler, but it wasn’t long before he had started a thriving rag trade business in the East End. His son was born on Boxing Day 1904 and would become one of the most controversial, feared and enthralling entrepreneurs of the twentieth century. Regarded by some people as the man who invented the take-over, his first purchase was the ailing Cricklewood Skating Rink in 1928, followed three years later by the loss-making Prince of Wales theatre on London’s Coventry Street.

  By 1953, Clore had amassed a fortune. As a frequent visitor to the United States, he had looked carefully at shoe businesses, noting that American women bought on average twice as many pairs of shoes each year as British women. He reasoned that it was only a matter of time before the British would catch up.

  On returning from one such visit, Clore’s friend Douglas Tovey, an ambitious and gregarious estate agent who worked for a firm called Healey & Baker, alerted him to Sears & Co (the True-Form Boot Company), which owned Freeman, Hardy & Willis and Trueform, comprising some 920 outlets across the country. Clore was interested in the shoes, but he was even more taken by the shops in which the shoes were sold. With Tovey’s help, he worked out that the value of the retail properties greatly exceeded the value of the shares in the company – and in February 1953 he pounced, sending his offer direct to shareholders. As David Clutterbuck and Marion Devine wrote in Clore: The Man and his Millions:

  To the board of Sears, the sudden attack was devastating. Its response was confused and unconvincing. The idea that anyone would make such an approach direct to the shareholders was unbelievable. Worse, it was ungentlemanly.

  Accusations of ungentlemanly behaviour had never stopped Clore in the past. He had studied the tactics of American companies when confronted with hostile bids and was fully prepared for the unfolding furore. According to Clutterbuck and Devine:

  What offended so many people in the City was that Charles [Clore] had broken the convention that acquisitions should be by agreement. It was felt to be the equivalent of being asked to dinner and stealing the silverware. It was unthinkable, an outrage, yet it was legal and it was done.

  Retail was in his blood from an early age, when he used to sell newspapers on street corners, and he had successfully built up Richard Shops, a retail chain that he bought low and sold high in 1949. Sears chairman Dudley Church was reported as saying: ‘We never thought anything like this would happen to us’, and the Sears family was incandescent with rage at the speed of events. But the deal was done and within twelve months, the sale and leaseback of properties to Legal & General raised £10 million, with Clore telling shareholders at the 1954 annual general meeting that the company still retained more than £3 million worth of freehold factories, warehouses and shops. Clore said:

  The first call on this money will be the requirements of the footwear business to enable it to carry through the programme of improvements and expansion … it is not in the interests either of the shareholders or of the National Economy for a Company such as ours to retain vast sums locked up in freehold properties … our capital should be employed primarily in our own business of making and selling boots and shoes.

  Buying up smaller shoe companies was another vital part of Clore’s strategy. In 1954, Freeman, Hardy & Willis acquired Harry Levison’s Fortress Shoe Company, which had 39 high street outlets, a deal that resulted in Levison, whom Clore admired as an arbiter of modern fashion, eventually taking over the entire management of Clore’s shoe empire. Fortress was renamed Curtess and then Freeman, Hardy & Willis bought Philips Brothers’ Character Shoes Ltd for £700,000.

  Work in the sole room at Street, 1950.

  J. Sears became Sears Holdings shortly before the Philips Brothers’ acquisition, after which Dolcis was acquired for £6 million, followed by Saxone, Lilley & Skinner and Manfield in 1956. The Dolcis deal alarmed Clarks. Prior to t
he September board meeting, Bancroft circulated his thoughts to other directors:

  Clore’s group has total assets of approximately £20 million and is therefore about four times as large as we are … there is nobody in the USA now of similar dimensions.

  Others shared his concern. Writing in the Sunday Express that same month, Edward Westropp, the paper’s City Editor, said it was ‘just another dreary financial deal, just another company changing hands. What interest could that possibly be to us – the shoppers of Britain?’ Then he went on to answer his own question, warning that Clore was robbing consumers of proper choice

  Now is the time to let the shopper know who he is going to. Let it be obligatory to put the name of the real owner or parent company in big letters over the door.

  On seeing Westropp’s piece, Cecil Notley, Clarks’ advertising man, wrote to Bancroft wondering if the chairman might have ‘inspired the article’, adding that ‘it seems to be just what the doctor ordered’.

  Along the way, Clore formed the British Shoe Corporation as an umbrella organisation for his footwear operations, electing to establish the headquarters in Leicester rather than using Freeman, Hardy &Willis’s main offices in Northampton. By 1962, the British Shoe Corporation controlled 2,000 shops.

  This dramatic concentration in shoe retailing was at odds with the ongoing diversity of shoe production. In 1956, there were still some 1,000 firms in the business of making footwear in Britain, of which more than 80 per cent employed fewer than 200 people. Only around 50 shoe manufacturers had a workforce in excess of more than 400. Clarks was the largest single manufacturer in the country.

  Clarks was not only a recognised and respected name on the British high street but was close to becoming a pillar of the establishment. Shortly before Queen Elizabeth II’s coronation in 1953 (during which she wore shoes designed by Roger Vivier), the company felt compelled to put out its own statement to mark ‘an event so momentous that all ordinary happenings lose something of their importance’. Describing the crowning of a young Queen as a ‘symbol of hope, of endeavour, of re-dedication to our duty’, the statement went on to declare that

  A mid-1950s window display card for Clarks Teenagers shoes. Clarks had targeted the teenage market from 1950 onwards.

  … if in these crowded islands we no longer have the surpluses of national wealth our forefathers enjoyed, if we have to depend more and more on hard work and the application of unceasing commitment to industrial, commercial, agricultural and educational needs in order to win through, we feel that in our Queen, already proven in the ordeal of tireless public service, we have a shining example, spurring us on to our goal. Invigorated by the spirit of youth and freedom which she manifests we can, and will, achieve a new and happy way of life.

  8

  Expansion, contraction – and management consultants

  THE 1960S BEGAN WITH A SWING. And in Street there were no signs that the music would stop, or the party end. In the first year of that decade, Clarks recorded sales of £18,482,000 and a pre-tax profit of £1,446,000, up 10 per cent on the previous year.

  ‘Our rate of expansion is rapid,’ wrote Bancroft Clark in the Annual Report and Accounts for the year ending 31 December 1960. He continued:

  In the four years from 1956 to 1960, total assets have nearly doubled … such continuity of good trading is unusual. It may be that the public is turning away from consumer durables, the demand for which, I think, began to fall off before the latest credit squeeze. The public may be more interested in dress, including shoes, than it has been since the end of the War … we had not forecast such good demand.

  This was the period when Clarks factories were at the fulcrum of its business and when the broader Clarks community flourished like never before. Demand was so strong that in the autumn of 1960 the factories were running at full capacity – and yet retailers were still complaining of a lack of stock. Clarks was not the only footwear company in celebratory mode. It had been a spectacular year for the whole of the trade in the UK. But it wasn’t just UK shoemakers who were doing well. At the same time, imports of cheaper shoes from abroad also reached a post-war record.

  Demand for shoes may have been on the increase, but so too were manufacturing costs. In 1960, wages in Clarks factories increased by 3 per cent – with a further 3 per cent rise scheduled for February 1961. At the same time, in 1960, the working week was reduced from 45 to 43¾ hours. Later on, it was to be reduced yet further to 41½ hours. Rather than increase prices – except on some of Clarks’ more popular children’s lines – Bancroft’s answer to raised costs was to pursue new, more economical methods of production:

  If these come off and if we can exploit them, they should enable us to offer better value, make more money and sell shoes at lower prices … These are techniques which are used by the vast mass production factories of Russia and Czechoslovakia and which have not, hitherto, generally speaking been applied to the smaller factories and shorter runs of the shoe trade in the western world.

  As well as providing inspiration for economical production methods, with a huge order for women’s footwear, Russia also contributed to the boost in Clarks exports which, overall, exceeded £1 million for the first time. The interest from Russia would lead to Clarks periodically advertising on Soviet State television, particularly during extreme, cold winters when freezing Russians were reminded of the warmth and comfort of Clarks’ wool-lined range of ‘Igloo’ boots. In 1959, Bancroft and his eldest son, Daniel Clark, were among a group of shoe manufacturers from the UK who visited Moscow and Leningrad in the Soviet Union, and Kiev in the Ukraine. They were accompanied on this busy, eleven-day fact-finding mission by a member of the BBC’s Overseas Monitoring Service, who acted as interpreter. The consensus was that the Russians were ahead of the west when it came to the vulcanising of microcellular soling – or rubber soles – and other non-leather progressions in the trade, but were way behind in styling, particularly of women’s shoes, which, Bancroft noted, in the Soviet Union tended to have thick, rounded toes and chunky heels. The really good news, however, was learning that although the Soviet Union intended to increase its shoe production by 50 per cent over the next five years, it had no plans to build new factories to achieve this ambitious goal. Almost certainly, the Soviets would have to rely on imports.

  Clarks shoes on parade at a fashion show in Moscow in 1956.

  There had also been a development in Canada a few months before the Coronation, when Clarks bought the loss-making Blachford Shoe Manufacturing Company Ltd. Founded in 1914 by two brothers, Blachford specialised in high-grade welted women’s shoes, making 100,000 pairs a year, and the board was confident that it could be turned around. With the company came a coast-to-coast sales organisation, which Jack Rose-Smith, who had brokered the deal, hoped would double Blachford sales within two years. In fact, despite the efforts of several senior directors who made visits to Ontario – including Bancroft himself – the Canadian operation was a burden. A loss of £8,000 in its first year was understandable, but explaining further losses of £18,000 in 1954 was more difficult. By the end of 1956, Bancroft wasn’t bothering to give exact sales figures, bluntly reporting in the Annual Report and Accounts that ‘Canada again lost a large sum’. And in 1960, he simply wrote: ‘Canada business is bad’.

  Meanwhile, sales in markets elsewhere in the world were mixed. Business in Africa was strong and accounted for nearly a quarter of Clarks exports, while the West Indies and to a lesser extent Europe were proving to be encouraging. Trade with America was tough, but it was better in Australia where, in 1959, the company had bought the majority of shares in G. T. Harrison Shoes Ltd, the firm which had begun manufacturing Clarks under licence almost a decade earlier. Then, in the spring of 1960, Clarks acquired Diamond Shoes Ltd, a Melbourne firm specialising in women’s shoes. There were now three factories in Australia, with a fourth soon to open in Adelaide.

  Production of Clarks Torflex children’s shoes in New Zealand began in 1961, and clo
ser to home a new factory was built on the Dundalk site in Ireland. Shortly afterwards, Clarks acquired the Irish manufacturer Padmore & Barnes Ltd, in Kilkenny, a move which meant that worldwide, Clarks now employed more than 10,000 people and made nearly 11 million pairs of shoes a year.

  In an effort to bring together all overseas shoes interests, the board had decided, in 1959, to form a new division called Clarks Overseas Shoes Ltd, which was responsible for exports from the UK, manufacturing in Ireland, Australia and Canada; manufacturing under licence in New Zealand and South Africa; and wholesaling in the United States and Rhodesia (now Zimbabwe). Arthur Halliday was made managing director and Jack Rose-Smith a director.

  Meanwhile, at head office in Street, Bill Graves, who was not a family member, became a director. He had joined the company in 1933 at the age of fourteen and attended Strode School in Street. After rising swiftly through the ranks, he proved to be a big success as head of production of children’s footwear and was still only 41 when appointed to the ten-man board. In 1960, there were four other non-family directors: Arthur Halliday, Jack Davis, Leslie Graves (Bill’s older brother) and Reginald C. Hart.

  The issue of what roles members of the family should play in the firm would test Clarks in the years to come. Bancroft found it a vexing and at times tiresome discussion, even though in 1960 he made a point of saying that ‘the key to a successful future lies with securing good professional management at all levels’. He went on to explain that by ‘professional’ he meant: