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Gerald Ratner is widely credited with making the ultimate off-the-cuff gaffe with his infamous ‘it’s total crap’ description of some of his company’s products.
The remarks, which wiped £500 million from the value of his company, were made in a speech in 1991, yet such is there notoriety that when someone makes a similar mistake now it is still referred to as ‘doing a Ratner’.
Mr Ratner was speaking at the UK Institute of Directors when he said: “We also do cut-glass sherry decanters complete with six glasses on a silver plated tray that your butler can serve your drinks on, all for £4.95. People say, ‘How can you sell this for such a low price?’ I say, 'because it’s total crap’.
He added his store’s earrings were ‘cheaper than an M&S prawn sandwich but probably wouldn’t last as long.’
But how much do we really know about this speech and the way it was handled by the media?
We sent Lawrence McGinty, one of our expert tutors, to find out more about the infamous comments and what Mr Ratner thinks of the media now.
Click on the video above to watch the interview and read a full transcript below.
Lawrence: How did you feel at the time about the media and how do you feel now that you have recovered?
Gerald: Well, I didn’t realise that the media could cause so much trouble for me. I know it sounds a bit naïve but I thought I was sort of bombproof. I didn’t think it would transfer into my business going down the pan. I never thought that for a minute, especially not The Sun. I was actually more worried about The Times and The Telegraph and all those sorts of papers writing negatively about the company because it would affect the share price.
I never really focused on that side of the media, although it is true to say that I was very high profile and it was doing me a certain amount of good at the time because in the Ratners Group there were other companies that were not called Ratners and we could see the Ratners name, because of my profile, was actually out performing others like H Samuel and Ernest Jones. So all that publicity – I’m not comparing myself with Branson - but there was a little bit of that in there at that time.
But everyone kept warning me it is a two sided coin and I dismissed that as you do when you are on the crest of a wave.
For many years after I was very upset with the media because they were very disingenuous to be honest with you, but that is what they are like and now I can understand that.
The Sun and The Mirror are not going to sell papers by reporting something verbatim and I should have realised that. Because of that I have never gone out there and criticised the press publically. You see these football managers and celebrities doing it all the time and it just doesn’t come over very well. Also, if you are going to try to turn them around you are not going to do it that way anyway.
I don’t feel as bitter as you might think.
Lawrence: If you are approached now to do an interview with a newspaper how do you feel about it?
Gerald: I would do it still, so I obviously haven’t learnt my lesson. At the moment, whether I am doing speeches, my online business or whatever, it is good business and I have to be in the public eye as much as possible. I am not in that luxurious position that some people can be in business where they don’t need the media. I would rather be in that position to be honest with you because you can see the dangers of it. I’m more likely to be offered a speech up in Scunthorpe if I have been in the newspapers the previous week. The people who are making these decisions are reading this and thinking ‘oh yes Gerald Ratner’ and opportunities come about because of that. I got funding for one of my businesses purely because I was in the Daily Telegraph about something totally irrelevant. It gets people thinking about you and you need to be in the public eye.
Lawrence: Can I take you back to when you were preparing that speech, because I read that you actually prepared it very carefully?
Gerald: Yea I did because it was a big event. It was the biggest speech I had ever done at the time to do the Institute of Directors at the Albert Hall. There were about 4-5,000 people including the President of South Africa President de Klerk, Norman Lamont, who was a bit of a big shot then, and there was going to be John Major but because he became Prime Minister he handed down to Norman. They always use to choose the businessman of the time and it was a great compliment.
I nearly pulled out because I began to get nervous about it because I was writing the speech and thinking I’m not use to this sort of thing, it’s going to be a flop. They said I could pull out if I wanted to, but I carried on with it and it was a deadly serious speech. In fact it went on YouTube in its entirety only about six months ago and it is a good speech with a lot of serious messages.
In fact, with the first draft I sent a copy round to all my colleagues on the board of the Ratners Group and one of them came back and he said ‘well, it is a good speech, the only thing that’s missing is there is no jokes in it’. So I said ‘the jokes that always work are the prawn sandwich one and the sherry decanter one’. So he said ‘well put those in’. So I said ‘well they relate to H Samuel actually’ and he said ‘never mind just say for Ratners’. So I put those in at the last minute and I don’t really blame him for it. I don’t think he tried to get rid of me, this director. I think he was genuinely trying to be helpful.
Lawrence: And of course they were ironic in a way and that is the hardest humour to understand, isn’t it?
Gerald: Self-deprecating as well, yes. I was always self-deprecating – some people say I have a lot to be self-deprecating about. I just felt it worked to not be the normal businessman who is always sort of blowing his own trumpet – I never felt that goes down well. However successfully you are people do get a bit turned off by your continual boasts about how wonderful you are. If you do throw in a few negative things like that you can then get away with then blowing your own trumpet a bit more. Anyway, the people in the Albert Hall all felt it was very funny the way it was meant as a joke. But the Institute of Directors send a copy of the speech to all the press in advance and I was told the press was going to be there and the Daily Mirror was particularly interested in the story. Anyway, as I left I was quite relieved because I was so nervous about this speech I had not even gone to work that morning. I went straight to the Albert Hall in the afternoon because I was in a bit of a state. The Daily Mirror journalist came up to me (afterwards) and he said ‘well, can you make a comment Mr Ratner’. I said ‘what about?’ and he said ‘you have made fun of your customers’. I said ‘no, it wasn’t meant that way at all’ and then he carried on and I just ignored him. Then I went out with a journalist called Jeff Randall that evening, which was pre-arranged. We went for this meal and outside the restaurant was the press again. Jeff went out and talked to them and said ‘they are after you, there’s The Sun out there’.
The next day it was all over the press, front page, page 3, page 5, and it was something that I didn’t recognise I had said. For instance I was quoted as saying ‘all my jewellery is crap’, which I never did, it was a joke about a sherry decanter. But there was no point arguing the toss I had made a mistake and as the press do they were very disingenuous. They really painted this picture of me being this arrogant snob, multi-millionaire, who’s customers can’t pay the electricity bill and save up for a pair of earrings and I made fun of them. I might have a lot of faults but I would not have gone down that road. Why would I go down that road? It was a mistake making the joke, I accept that, but I’m not that person to make fun of customers. It’s just not who I am. Anyway, I paid a very high price for that to say the least.
Lawrence: There’s a very strange parallel between what you said all those years ago and last year when Professor (Tim) Hunt made a speech to journalists and was similarly ironic about girls and laboratories. Did you feel a certain sympathy for him?
Gerald: Well every week someone ‘does a Ratner’, according to Twitter anyway. Yea, I do feel an enormous amount of sympathy. What this will do is drive people out of the public eye and life will become very boring because you will get people that are professionally cautious that have been put up by companies to say things that really say nothing. They will just say ‘we take our customers seriously’ and things like this and keep repeating themselves. They are just up there to give it a straight bat which is a shame. But that professor adds a bit of colour, it is interesting and he got sort of drummed out of the Brownies. So it’s not a good thing but that’s what the media do.
Lawrence: Yet you have mentioned Richard Branson before. He seems to be able to inject some personality and energy but still say the right thing so to speak.
Gerald: Yea he knows what to say. He gets his fair share of disasters as we all do in business, whether it is a train crash or terrible food on one of his flights. They come up on a regular basis and his way of handling it is not to say ‘it’s not really our fault and it was somebody else’s fault and here are the extenuating circumstances’. His answer to it is actually quite clever, an indirect approach if you like. In the case of the train driver he said ‘the train driver is a hero’ and he deflected it. He didn’t deal with it face on. When someone complained about the food on this flight which was terrible and they took photos so it was inarguable that it was just sort of gruel, he made a joke about it, dealt with it himself, didn’t put up anybody, didn’t deny it, didn’t say ‘well it wasn’t my fault’ and knew how to handle it. I’m sure that BP when they had the oil slick, if it was Branson dealing with it he would not have turned round and said ‘I’m waiting to get my life back’ or as the chairman said ‘we always treat little people well’.
There is a way, which I have learnt, which I didn’t know at the time, that is if you do feel that it is not your fault and you are being unfairly treated, you shouldn’t start arguing the toss. Just put your hands up, accept it’s your fault and everyone will accept you do make mistakes. When Hugh Grant got caught with the prostitute he said ‘it was a ridiculous thing to do, I’m not going to deny it and I have a weakness’ and people have a certain amount of sympathy for that, they are reasonable. What they can’t accept is when you deny it, like Michael Fish did with the weather when he said ‘it was Bill who fed me the line’ and he said he didn’t say it even though he is filmed saying it. I’ve learnt that you have to over apologise if you like.
Lawrence: What advice would you give to people about what they can do when they make a mistake?
Gerald: There is no quick fix. Volkswagen have just been down this road. The answer really is you have to be successful again. I know that is easier said than done, but people do admire success, especially if it has come after a fall. If you remain in the gutter people are going to keep kicking you there, which is what they do after you have made a mistake. If you pull yourself out of it and are successful people admire that. Suarez the footballer kept getting into trouble but also kept scoring goals. If he hadn’t scored goals they would still be criticising him. David Beckham was the most unpopular person in Britain when he got sent off and cost us the quarter final against Argentina, but look at him now. He has achieved that by basically being good at football and being an ambassador for football.
You can come back stronger than ever. It won’t happen the next day and it won’t happen by denying it and saying ‘I wasn’t there’. You have to go through certain stages. I always think the first one would be denial, then the next one would probably be anger that it happened at all and then you will go through bargaining where you will try and make it better than it was and then it will start dawning on you and it will be depression because of what you have done. And finally, the fifth one is acceptance. You might be a bit better just to accept it on day one rather than go through all of those things.
Lawrence: We are in the business of media training. Do you think that would make a difference in terms of stopping you make those mistakes?
Gerald: Well, I’m unlikely to make a mistake now, although it wouldn’t make any difference because people still know me for that one mistake. If I did anything terrible now it would have to be pretty massive to compete with that one. But that is a sort of glib answer. I think there is a bit of truth that because I made that mistake I am more careful now not to make the mistake and I understand how you can make these mistakes.
Sometimes people come up to me and say ‘here by the grace of God go I’ and ‘I did all this and got away with it’. There is no real rhyme or reason why suddenly somebody will say something and it will be on the front page of the newspapers and someone, maybe a politician, says something worse and it will never happen. There is a bit of luck involved. There are very few people who go out there looking for controversy. I do feel there is this ultra-cautiousness with companies at the moment where you really get turned off by the fact they are saying all the right things and repeating it. They are saying the bleeding obvious, as John Cleese would say, and really there is not a lot of point in that. But I can understand it to a certain degree and I’m very cautious now in what I say and I try and say the right thing only because I have experienced what it is like to make a mistake and I’m really scared of going back down there. It is like when you have lost all your money, when you recover you make sure you don’t lose it again.
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