{"id":4747,"date":"2020-12-01T01:38:44","date_gmt":"2020-11-30T23:38:44","guid":{"rendered":"https:\/\/bornmillennials.com\/?p=4747"},"modified":"2020-12-13T16:04:32","modified_gmt":"2020-12-13T14:04:32","slug":"arcadia","status":"publish","type":"post","link":"https:\/\/bornmillennials.com\/index.php\/2020\/12\/01\/arcadia\/","title":{"rendered":"The Collapse of Arcadia Illustrates Yet Again How Entrepreneurship Is More Secure Than Having a Job"},"content":{"rendered":"
<\/div>\n

That\u2019s it. Arcadia, Philip Green\u2019s retail empire making up about 12% of England\u2019s retail clothing shops, has collapsed.<\/p>\n\n\n\n

It leaves behind 13 000 jobs and about 500 clothing stores.<\/p>\n\n\n\n

The Signs of the Inevitable Doom Were Clear<\/strong><\/h2>\n\n\n\n

Green and his wife Tina acquired Arcadia in the year 2000. At the time, Green was chairman of the retail company Amber Day, and Tina had various businesses no one really ever understood what about.<\/p>\n\n\n\n

Quickly, they set up a structure to avoid paying taxes. Tina went to live in Monaco, famous for its inexistent tax rate on personal income, and subsequently acquired 95% of Arcadia.<\/p>\n\n\n\n

In effect, Philip Green was CEO of Arcadia but did not own it. His wife did.<\/p>\n\n\n\n

With Tina protected from taxation, Green (Arcadia) paid her a \u00a31.2 billion dividend in 2005. The pre-tax profit of Arcadia was \u201conly\u201d \u00a3300 million.<\/p>\n\n\n\n

This sign alone should have been sufficient to understand that neither Green nor his wife were interested in the long-term management and well-being of the company. Similar to Adam Neumann\u2019s shady behavior to wire money outside of WeWork, the Greens sucked the life out of Arcadia.<\/p>\n\n\n\n

They didn\u2019t buy the company as a long-term investment. They bought it as a cash cow.<\/p>\n\n\n\n

Over the years, Arcadia was revealed to be mismanaged and underinvested. Meanwhile, Philip Green spent time buying yachts (he bought three), threw a \u00a35 million birthday party, and received a $250 000 monopoly with golden pieces from his wife.<\/p>\n\n\n\n

As retail started moving online at the beginning of the 2010s, Arcadia stayed the course. Without any attention from its CEO, sales slowly started to decline. In 2015, Green sold BHS, another clothing brand in decline, to a former racing driver (with no experience) for \u00a31. Shortly before the sale, a friend of the Greens had received about \u00a395 million of dividends from BHS, wired to an HSBC account under the name of\u2026Tina Green.<\/p>\n\n\n\n

When the pandemic hit in February 2020, Arcadia was already struggling. The brand had lost its appeal and no effort to move the business online had truly been made.<\/p>\n\n\n\n

The virus only precipitated the doom of the company. Under its current leadership, it could not have survived anyway.<\/p>\n\n\n\n

What About the Employees?<\/strong><\/h2>\n\n\n\n

I don\u2019t know Philip Green personally, but I doubt he cares much about the 13 000 people that used to work for him.<\/p>\n\n\n\n

Corporations remind you that you\u2019re part of a family until they have books to balance.<\/p><\/blockquote>\n\n\n\n

The sad story of the collapse of Arcadia outlines once again how dangerous it is to leave the fate of your job into the hand of someone else.<\/p>\n\n\n\n

When I told my grand-aunt I wanted to try entrepreneurship, she told me the risks to fail were enormous. I answered that I\u2019d rather make sure where my money came from myself, then trusting someone else with such an important task. The odds felt weirdly in my favor.<\/p>\n\n\n\n

For Philip Green, the collapse of Arcadia merely means that he may not get such a nice helicopter onto his yacht. For the 13 000 employees and their families, it\u2019s a catastrophe.<\/p>\n\n\n\n

Retail is a dying sector. It has been for quite a while now. The cost of the collapse of Arcadia will not only be felt by the people that directly depend on it but will also be carried away by the British taxpayer, among which the Greens\u2026are not even part of.<\/p>\n\n\n\n

The Bottom Line<\/strong><\/h2>\n\n\n\n

The Greens\u2019 behavior regarding the management of Arcadia wasn\u2019t illegal.<\/p>\n\n\n\n

However, it was goddamn unethical.<\/p>\n\n\n\n

This sad story shows how the former \u201ccertainty of a job\u201d is disappearing. As trends evolve fast, so does the job market. The employees\u2019 skillset is going increasingly digital.<\/p>\n\n\n\n

The story of the doom of Arcadia outlines how employees are first on the frontline when their CEOs make mistakes \u2014 or simply don\u2019t care.<\/p>\n\n\n\n

This tale reminds us that a contract with a company, no matter how good it may sound at the beginning, may ultimately be the most insecure and risky position one could have.<\/p>\n\n\n\n

Philip Green can probably testify of this.<\/p>\n\n\n\n

Photo: Photo by freestocks<\/a> on Unsplash<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

That\u2019s it. Arcadia, Philip Green\u2019s retail empire making up about 12% of England\u2019s retail clothing shops, has collapsed. It leaves… Continue Reading<\/a><\/p>\n","protected":false},"author":1,"featured_media":4750,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[9,27,8],"tags":[],"class_list":["post-4747","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-life","category-entrepreneurship","category-economics"],"jetpack_featured_media_url":"https:\/\/i0.wp.com\/bornmillennials.com\/wp-content\/uploads\/2020\/12\/101.jpg?fit=1200%2C800&ssl=1","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/bornmillennials.com\/index.php\/wp-json\/wp\/v2\/posts\/4747"}],"collection":[{"href":"https:\/\/bornmillennials.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/bornmillennials.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/bornmillennials.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/bornmillennials.com\/index.php\/wp-json\/wp\/v2\/comments?post=4747"}],"version-history":[{"count":0,"href":"https:\/\/bornmillennials.com\/index.php\/wp-json\/wp\/v2\/posts\/4747\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/bornmillennials.com\/index.php\/wp-json\/wp\/v2\/media\/4750"}],"wp:attachment":[{"href":"https:\/\/bornmillennials.com\/index.php\/wp-json\/wp\/v2\/media?parent=4747"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/bornmillennials.com\/index.php\/wp-json\/wp\/v2\/categories?post=4747"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/bornmillennials.com\/index.php\/wp-json\/wp\/v2\/tags?post=4747"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}