by Sugar, Alan
A couple of weeks went by and I was contacted by this fellow again.
‘Right, we’re ready to give you a big order.’
If I remember rightly, it was for 500 amplifiers and 500 pairs of speakers – and here’s the bit that’s incredible. He wanted them delivered in the next three weeks to Gatwick, where the whole lot would be sent by highly expensive airfreight to Nigeria. Can you believe that?!
To put it into perspective, in those days to airfreight a box the size of a suitcase would have cost about £100 and this order would have filled at least one forty-foot lorry. They had chartered a big freight jet!
My streetwise upbringing kicked into play. Where was the sting? Was it: ‘Be nice and polite, send the money for the samples on time and then, when you get the five hundred units, don’t pay’? I pleaded poverty and told him that to produce such an order, we would need the finance for it.
He replied, ‘No problem at all – we will send you the money tomorrow.’
In those days, there was no telegraphic transfer system. There were ways of transferring money from bank to bank, but it never happened instantaneously – sometimes it took a few days. This all seemed too good to be true. I wasn’t going to ship one thing for this fellow until I had the cash.
Sure enough, in the next morning’s post came a massive cheque from the United Africa Company. I called my bank manager at Lloyds in Islington and asked him whether he’d ever heard of this company. It shows you how cocooned I was in my narrow-minded way – it turned out that this was a massive organisation which had been trading in Africa for many years and had many African assets. The bank manager said that he’d look at the cheque and if it was authentic, he’d give me an assurance to go ahead. I sent my dad straight up there with the cheque. The manager phoned me back saying it was okay.
Bloody hell! I’d hit the jackpot!
It was time to get back on the phone to this fellow and do a bit of schmoozing. It transpired that the Nigerian government, for reasons best known to themselves, had declared a bonus of the equivalent of £200 to all civil servants. These civil servants were taking their windfalls along to Kingsway Stores to buy up anything that was considered luxury goods, including hi-fis. It was clear that this fellow was no expert in electrical goods; he had merely been given the job of filling Kingsway Stores with hi-fis, fast. What also occurred to me was that everybody else he’d contacted in the UK must have given him the cold shoulder. His other ports of call would have been people like Philips, Sony and the Rank Organisation, companies where he could never have got an audience with the boss. He would have had to go through layers of management, by which time he would have been too late, whereas I was on to it like a flash. But let’s not forget that Amstrad was a known brand in hi-fi and the Nigerians did read the UK hi-fi magazines.
I saw the potential straightaway and asked this fellow if there was anything else that he might require, as I was off to Japan shortly. He asked me if we could get a supply of portable radio cassettes with shortwave radio. I mentioned that even though portable radio cassettes, tape recorders, etc. were not part of Amstrad’s line-up, I was sure I could source some and fulfil his needs, though I didn’t really expect anything to come of it.
Back to my Japanese trip. I hadn’t travelled overseas much before; the furthest I’d flown was to Majorca and Italy. So going to Japan was to be an adventure. I decided to take Ann along and her mum and dad offered to look after the kids.
As I was making real money by now, I bought first-class tickets. So there I was, twenty-eight years old, sitting in first class with my twenty-seven-year-old wife, getting some rather strange looks from other more mature and worldly passengers. I think people thought we were from some pop band – how else could people who looked like us afford to travel this way?
It was an exciting adventure. In those days, the plane had to stop to refuel in Anchorage, Alaska – there were no non-stop flights from London to Tokyo. The duty-free area in Anchorage was like a little town, full of shops selling everything from cosmetics to cameras. One thing that sticks in my mind was a giant polar bear in a glass display cabinet in the departure lounge. It was a real, stuffed polar bear, and all the Japanese people surrounded the display, taking photos.
A strange thing happened to me when we got to Tokyo. As the plane touched down in what was unknown territory, a wave of insecurity came over me. Here I was, thousands of miles away from home, in a strange place with a strange culture.
I’d told Waco Trading that I was coming and they had booked us into the Okura Hotel in Tokyo, opposite the American embassy. Mr Imai met us at the airport. As we came through customs, I saw him, a thin little grey-haired man with glasses. If ever there was a stereotypical image of a Japanese man, he was it. He was standing there, diligently holding a sign with my name on it. As I approached him, I said, ‘It’s me – Mr Sugar.’
His immediate reply was, ‘Where is your father? Are you Alan Sugar?’
I said, ‘Yes, I am Alan Sugar.’
He was stunned that the person he’d been communicating with all this time was this young fellow with long hair and a leather coat. I introduced him to Ann, but he was still in a state of shock. In Japan in those days it was virtually unknown for young people to be in business. My visit there was to be full of surprises for the people I’d meet.
Mr Imai drove us from the airport to the Okura Hotel. For the first time in our lives, we experienced jet-lag. We were shattered and went to bed soon after we arrived, at about nine o’clock at night, only to wake up three hours later thinking we’d slept through the night. I stuck the telly on and tried to watch an Elvis Presley film with his voice dubbed in Japanese. Really funny.
The next morning, Mr Imai took us to his office – just one room on the third floor of a small office block. I was astonished to see this company working out of one room – I guess I’d had visions of Shomei Trading being some massive organisation. In a way, it was comforting – here was a very small company with a hunger to do business and a boss in control of his costs.
Mr Imai introduced me to his three members of staff. He went on to explain that everyone there thought that the man who’d previously come to see them – Peter Jones – was the boss. He’d told them he was in charge. I explained that Jones had left and he was never the boss. They didn’t understand and, to be honest, I didn’t have the will to explain it, other than to reiterate that I was the boss.
It transpired that Jones had slung his weight about and was taken to the finest restaurants in Tokyo. Obviously he’d gotten himself into a situation where he felt he had to place an order. I wouldn’t have minded, but he didn’t even know what a bloody toggle switch was.
Ann was sitting beside me wondering what she was doing there. She was aware, of course, that I was in the business of hi-fi and electrical stuff, but never knew any of the details. I have to say, in my defence, that I never prevented her from getting involved – she simply wasn’t interested. In fact, she hadn’t even been to any of my business premises.
She must have been bored out of her mind listening to all this nonsense. At least in the afternoon Mr Imai took us to the centre of Tokyo, to see some of the big department stores and a place called Akihabara. Akihabara was my Disney World – a street of giant shops, seven or eight storeys high, with elevators taking you to different departments, as well as a bazaar-style market where you walked through passageways lined with stalls selling every electrical gadget you could think of. I was in heaven collecting brochures and taking pictures. Akihabara provided loads of food for thought and was to be my hunting ground for years to come.
Mr Imai’s first name was something like Akira. I found it hard to remember, let alone pronounce, so as we warmed to each other, I asked him if he minded me calling him Harry. He was delighted, as if it were some kind of compliment. In fact, I was to go on to discover that a lot of Oriental people I dealt with in later years had given themselves Western-style first names to make their customers feel at home,
particularly American customers. Harry told me that that he would call me Sugar-san, a term of endearment and respect in Japanese culture.
I was scheduled to meet Waco Trading the next day, so I sent a telex from the hotel to the fellow from the United Africa Company giving him my contact details and saying I’d get in touch if I could help him with the purchase of some radio cassettes.
Seeing Waco Trading was an interesting experience. In stark contrast to Shomei, Waco’s headquarters were quite plush. Walter Colson, an elderly man in his seventies, sat behind his giant desk in a grand, wood-panelled office. Outside sat what looked like some quite serious executives, including one European-looking gentleman who turned out to be Walter’s son, Ronnie. I discovered later that Ronnie was fluent in both Japanese and English, which he spoke with an American accent, and was a bit of a playboy, mixing with Tokyo’s mostly foreign elite.
Walter expressed the usual surprise at my age, then introduced me to his general manager, Mr Sakai, a round-faced man in his forties with slicked-back silver hair. He was Japanese, but dressed like a Westerner, in fashionable clothing. He was a real smoothie and must have spent some time in the USA, as he also spoke with a slight American accent. He was totally untypical of what you’d expect a Japanese man to be like. Walter also introduced me to a trendy young man called Joe Oki, allocated to me by Waco as my contact man.
After the niceties and introductions, Walter sussed that Ann would be bored out of her brains and offered to send her around Tokyo with his wife, so as to free me up for his band of vultures. Walter’s wife was Japanese – tall, attractive and thirty years his junior. She spoke perfect English and I was happy that Ann would be in good hands.
Most of that first meeting with Waco was spent exploring what else they could sell me. Joe and Sakai gave me a grand introduction to all their staff and so-called specialists.
Sakai had heard that I was Jewish (as was Walter, of course) and thought it quite cool to include in his spiel a few Jewish words here and there. There is nothing worse than a non-Jew using Jewish quips and expressions in the hope of impressing a group of Jews. It’s bad enough when English gentiles attempt it, but when someone Japanese tries it, it’s like watching white police officers trying to dance at the Notting Hill Carnival. Embarrassing.
I’ve witnessed lots of attempts by non-Jews to speak in this way and, looking back, I guess Sakai would have got 4/10 for effort. Colin Lewin would get a creditable 8/10 and Gulu, bless him, 9.9/10 – he had great pronunciation with his ‘huchs’ and ‘nuchs’.
Anyway, despite the plush offices and trendy staff, it was clear that Waco Trading were agents sitting between manufacturers and overseas importers. I placed some more orders for cassette decks, but stipulated that they had to have the new Dolby noise reduction system; without it, orders would dry up. As middlemen, they fed this back to the manufacturer, Orion.
I also gave them some information about the United Africa Company’s requirements and they told me that Orion also made radio cassettes and could accommodate some orders for a version with shortwave radio, as required for the Nigerian market. They quoted me some prices later that day. I added a big margin and telexed the United Africa Company chap in London. I wanted to honour my promise that I would look for radio cassettes for him, but having thought about the logistics of him paying me, me paying Waco and then arranging all the shipping from Japan to London to Lagos, I thought, ‘This isn’t going to work – it’s just a dream.’ So I gave him a ‘go away’ price, a price so high he would say, ‘No thanks,’ and go away. And that would be it.
When I woke up next morning, a light was flashing on the panel beside my bed – it was a message from the hotel’s Business Centre. I rang them and, with impeccable service, a telex was immediately brought up to my room.
I couldn’t believe my eyes! The fellow told me to order as many shortwave radio cassettes as I could get hold of in the next two weeks, taking into account the limitations of component supply and factory output.
I told Ann about this. She didn’t understand how crazy this situation was – she must have thought that this was how business is – but she could see I was excited. All she said was, ‘Oh good, that’s good.’
I was on a roll with this nutter. It seemed that he was going to buy bucket-loads of every product I offered him. Clearly the guy did not know what he was doing and, quite honestly, I knew deep down that this couldn’t go on.
Here comes another business lesson, one that I used for many years afterwards. I’ve got an order with a big margin – so that’s in the bag. I’ve got the prices from the supplier, but they don’t know I’ve got an order. The stupid thing to do at this point would be to rush back to Waco Trading and say, ‘Okay, we’ll take so many of these and so many of those.’
As soon as it was office hours, I called them from the hotel and said, ‘Okay, I could use 3,000 of these and 2,000 of those and 1,000 of those, but I think you must have made a mistake. The specification is correct, but the prices you have quoted are surely the retail prices I’ve seen in Akihabara.’
What must have seemed strange to the Waco Trading people was that they’d offered me some products that were alien to my range and within twelve hours I was interested in buying some – this was not normal practice. Anyway, Waco went into some bullshit about how domestic prices were really low because Akihabara sold at low prices to attract customers, blah, blah, blah. I told Sakai that, as he liked to try to speak like a Jew, he really should understand that I was twenty-eight years old and my Bar Mitzvah had been fifteen years ago – so cut the crap.
Truth was, I never saw any of this stuff in Akihabara. I made Waco a counter-offer, which I just plucked out of mid-air, about 30 per cent lower than their price, while still banging on about what retailers’ margins would be.
Time was of the essence, of course. In truth, there was just a small window of opportunity to juggle with and get this thing done, but it’s never a good thing to be seen to be rushing to conclude a deal. I took a risk and told them to forget it, that their prices were a joke. They must have thought I was the joker because no one makes their mind up that quickly. One minute I’m saying I can take thousands, the next I’m saying forget it. Anyway, it paid off because they left some frantic messages for me at the hotel to call them.
To cut a long story short, after a few twists and turns, we made a deal. Then there was a bit of dancing around, with them trying not to be rude. What they were trying to ask (but didn’t have the balls to) was: could I come up with a letter of credit or guaranteed payment, because they didn’t really believe in me that much. To be fair, it must have seemed odd that someone of my age could just swan in one day, ask for a quotation on products I hadn’t even seen or tested, then give them an order a day or so later.
I’m quite perceptive at recognising this type of thing, so I came out and told them to their face, ‘I can see you are worried about getting paid. I can understand this and it’s no problem.’
I explained the unusual set of circumstances and was able to confirm with my office that I had been paid upfront by the United Africa Company, which meant that I, in turn, could get the money to Waco within a few days.
When I confirmed with the chap at the United Africa Company that everything was going ahead, I also supplied him with some specifications for clock radios made by Orion. Sure enough, the next morning the light was flashing beside my bed.
Ann must have thought, ‘This seems easy, this work that you do. You send a message and quote a price, they send a message back and say they want to buy it, and you just organise it – quite easy.’
I told her, ‘What you are seeing here is an absolute, one-off phenomenon.’
Very rarely in life do you come across opportunities like this, and you have to grab them. Realistically, this was not long-term business – it was opportunistic; strike while the iron’s hot, make some money and get out.
Two factors combined to bring about this windfall. Firstly, as I’ve me
ntioned, it was quite clear that this man was not an experienced electrical buyer, as he never negotiated on the prices; and secondly, there was the one-in-a-million situation in Nigeria, whereby all civil servants had been given loads of money to spend on themselves. Obviously it all dried up in time, but I reckon I must have earned around £50,000 from that episode, a phenomenal amount of money for a twenty-eight-year-old in 1975.
One evening, we arranged to meet Walter Colson at the American Club, where they were screening a Western film for American and British ex-pats living in Japan. It was close by, so Ann and I decided to walk there from the hotel. On the way, we were stopped by a policeman who demanded, ‘Identification! Identification! Identification!’
No one had told me that we needed to walk around with identification. My passport and business cards were at the hotel. There were no such things as credit cards in those days and we certainly didn’t have identity cards. In fact I had nothing at all on me to show who I was.
The policeman only seemed to know one word of English. Fortunately, we were just about outside the American Club and Walter’s wife was waiting for us. She saw the policeman talking to us and came over. I asked her to tell the policeman that we were willing to get in his car and go with him back to our hotel room to show him our passports.
He wasn’t interested in hearing that. I asked Walter’s wife to reason with him that if he took Ann and me back to the police station, what would he then do other than go to our hotel and get our passports, which is what I was offering?
He finally agreed and got on his walkie-talkie to call a police car. Then something must have happened because he just waved us on, as if to say, ‘Okay, go away.’ Walter’s wife explained that there were student uprisings going on at the time, and some American students were involved. I guess to this cop, Ann and I looked like a pair of Western hippies. From that day onwards, I kept my passport with me whenever I was in the Far East.