Total crap: a warning from history - how a company CEO can destroy their business with ill-chosen remarks – Gerald Ratner 30 years on

Total crap: a warning from history - how a company CEO can destroy their business with ill-chosen remarks – Gerald Ratner 30 years on

The phrase ‘snatching defeat from the jaws of victory’ comes to mind when recalling how Gerald Ratner managed to damage his company to the extent it almost collapsed.

It was a speech he made at the Royal Albert Hall in London on April 23, 1991, in front of hundreds of business people at a talk for the Institute of Directors that he made his ill-chosen remarks. Ratners at the time was one of the big names in jewellery on the High Street and were known for their budget range of gifts. Hundreds of thousands of brides to be had chosen their wedding rings from the glittering stores while with their tankards, eternity rings, ear rings and necklaces the stores were a popular supplier of gifts.

“We have earrings that are cheaper than a prawn sandwich from Marks and Spencer, But I have to say the sandwich will probably last longer than the ear rings,” he famously said. And to make it worse he continued: “We also do cut-glass sherry decanters complete with six glasses on a silver-plated tray that your butler can serve you 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.’”

Within hours of the speech Ratner Group’s value fell by £500 million as the press highlighted his remarks. His customers were so disgusted with his view of his own products they stopped buying their jewellery during the following days and weeks. In the end he was forced to change the name of the shops to the Signet Group. The firm struggled on is no longer the force it once was.

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