Inside Track by Peter Martin
It’s sell, sell, sell down at JD Wetherspoon. No, it’s not another discount beer promotion, but the shareholder advice coming from a raft of City analysts on the back of this week’s 20% profit dive.
It is not the first time JDW has felt the brunt of stock market animosity. Over the past decade the managed pub chain has had more than its fair share of adverse comment. But in the past, chairman Tim Martin and his team have always managed to pull something out of the bag to wrong foot their detractors.
This time it’s more serious.
It’s still a profitable business with many admirable qualities. But the company that once led licensed retail innovation can no longer claim to be the gold standard. Others have not only caught up, but some it can be argued have now overtaken it.
My colleague M&C Report editor Mark Stretton provides a detailed and illuminating critique of the company and its options in the March issue of the M&C Report newsletter. Not surprisingly one of the factors he highlights is the leadership of founder Tim Martin.
Nothing can detract from Martin’s achievements. He is one of the pub industry’s all time greats. But if you take a wider business perspective, it is hard to find an entrepreneur who has been able to create then successfully steer a company through all stages of development, certainly to the market leadership that Wetherspoon has achieved, and then to sustain it. It’s a big call.
The problem is compounded by Martin’s decision first to take a back seat and hand the chief executive’s role over to managing director John Hutson and then to change his mind and return to take over the reins again – if not in name, certainly in deed. It may be that having created the beast, Martin believes only he can turn it around.
Yes, Apple computer’s founder Steve Jobs did stage a glorious return after being turfed out – but came back renewed and armed with new ideas, like the iPod. What’s new and inspirational at JDW? A smoking ban?
Wetherspoon is one of few real brands in the pub business, a name that still, just about, means something. But it is looking tired. It can be turned around. The question is who is best equipped to do it?
Perhaps, Tim Martin should take a leaf out of the book of another industry big hitter, former PizzaExpress boss David Page? He has successfully reinvented himself as an innovative investor with his Clapham House business, incubating new concepts.
Page has proved there is life after running PizzaExpress, which at the time he too must have felt was probably the most important job in the world.
