Majestic Wine boss hopes Naked Wines’ entrepreneurial spirit will flow through the business
PUBLISHED: 17:10 15 June 2017 | UPDATED: 17:10 15 June 2017
Guy Bell/Majestic Wine
The boss of Majestic Wine says he is looking to replicate the energy and entrepreneurial spirit showcased by Naked Wines to accelerate his turnaround plans.
Chief executive Rowan Gormley wants to encourage managers to take a share of the profits from their stores, and improve customer service and retention through the business.
The model is inspired by the ethos of Naked Wines, which Mr Gormley founded before taking over the reins at Majestic following a takeover two years ago.
He said: “We trust our staff in Naked Wines to be entrepreneurial and historically that was how Majestic used to run, but I felt we had lost that in the last few years.
“We have put in a lot of energy and are giving staff opportunity to take control of their career.”
Majestic is 18 months into a three-year turnaround plan which has been led by Mr Gormley.
While the group posted losses of £1.5m for the 53 weeks to April 3, down from profits of £4.7m the year before, turnover increased by £63.3m to £465.4m. Majestic said profits were hit by investment in restructuring the business.
Naked Wines, which employs around 150 people in Norwich, increased sales by 26.3% to £142.2m, which the firm said was due to strong performances in the US and Australia, and had adjusted earnings before interest and tax (EBIT) of £600,000.
Mr Gormley pointed to a good second half performance by Naked, with sales up 26% and an adjusted EBIT of £3.4m, up 665.5% year on year.
Mr Gormley said the success of Naked Wines, which had to overcome a £2m profits hit after a failed US marketing campaign, was down to planning and team spirit. “It is a combination of things that drives it forward,” he said. “There are things like structured career plans and growth opportunities and some things that are important such as having a bit of a laugh. Companies that party together work well together – and we like to party. If the staff are happy, they make the customers happy and that is what keeps people coming back.”
Fine wines business Lay & Wheeler, based at Holton St Mary, near Colchester, has been led by a new management team which Mr Gormley said had brought about a cultural change. Sales rose by 36.2% with adjusted EBIT up five-fold to £0.9m.