Harrods will “take years to rebuild”, boss Michael Ward says

Harrods Michael Ward
Harrods made 700 redundancies in July, about 14% of the workforce
// Harrods managing director Michael Ward said he is pleased with the takings since the second lockdown was lifted
// However, he said it will take him “years to rebuild” the business
// Customers spent three times as much on the first day stores reopened in England, pushing up the day’s sales by 24%

Harrods managing director Michael Ward has reportedly said it will take him “years to rebuild” the business, as the Covid-19 pandemic continues to hammer sales.

However, Ward said he is happier now than he was a week ago, after reviewing the takings from last Wednesday — the first day that England’s non-essential shops were open after the second lockdown.

Ward said that although there may have been fewer customers than on the same day last year, those who came spent three times as much, pushing up the day’s sales by 24 per cent, The Sunday Times reported.


READ MORE: Harrods reorganises terms of £200m credit line due to lockdown #2


Meanwhile, optimism arising from the vaccine rollout is tempered by the government’s decision to scrap VAT-free shopping for non-EU visitors next month.

The Treasury reckons the move will save £500 million a year, while the Centre for Economics and Business Research predicted that the wider economic damage will end up costing the public £3.5 billion annually.

Ward said the policy is “fundamentally wrong” as it is a misguided attempt to save money.

The lockdown in March was the first time the store had closed for any significant time since the site opened in Knightsbridge in 1849.

Last year, Harrods saw pre-tax sales of £232 million on sales of £871 million, or £1.8 billion including concessions.

That has allowed Qatar Investment Authority to declare dividends totalling more than £1.1 billion so far.

To shift unsold goods after the first lockdown, Harrods opened an outlet shop on a short-term lease at the Westfield London.

At the height of lockdown, about 3500 staff were placed on furlough, with the company topping up their wages from 80 per cent to 100 per cent.

However, Harrods made 700 redundancies in July, about 14 per cent of the workforce.

Earlier this year, Ward said Harrods was forecasting a 45 per cent drop in annual sales. He is cautious about next year, too with the return of tourists.

Ward had planned to step down in 2016, but stayed on to see Harrods through Brexit.

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1 COMMENT

  1. Harrods luckily only has that store it’s got its name in Knightsbridge and it was tourism that’s not been over affecting its sales this year. Things will change and the tourist VAT changes should be changed. We cannot afford the loss of international tourism especially in the summer.

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