What You See Is What You Get: My Autobiography (28 page)

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Authors: Alan Sugar

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BOOK: What You See Is What You Get: My Autobiography
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I told Ashley that I was under a lot of pressure from the industry and mentioned G. W. Smith's threats. What's more, my friend Nick Lightowler told me that if rumours about my Global connection got through to Gerry Mason, Amstrad could be finished at Comet. Gerry was a very impulsive character and would cut us off just for the sake of it. I explained to Ashley that it was time for me to get out of retailing.

To be honest, this was only part of the reason I wanted to get out of Global Audio. My main concern was the fact that this company was going nowhere and was losing money. I knew that the bubble would burst eventually and I didn't want to be associated with it.

Ashley's response was one of shock. He couldn't understand why I would want to withdraw from a company which was taking PS25,000 a week. His attitude was, 'What's the catch? Do you know something I don't?'

I reiterated that there wasn't any other agenda. I guess I misled him a bit by saying this, but I just didn't want to debate with him that the business was going to go down the tubes. I emphasised that the problem was that my main business was going to suffer because of my association with Global, and
therefore, if he paid me PS25,000 there and then, I would resign as a director and give him my 50 per cent share of the company.

He was amazed - he thought he'd done the biggest deal of his life. The following week, he wrote me a cheque for PS25,000 which, let's face it, was a week or so's takings for him. I duly signed the resignation forms and quickly informed Derek Smith at G. W. Smith that I was no longer associated with Global Audio. I also sent a copy of my resignation in the mail to both him and Nick Lightowler. Ashley still couldn't believe I'd given up this pot of gold. He thought I was an idiot, and it suited me to let him think that.

Dennis and Malcolm had seen Ashley and I build a business in direct competition with theirs, but there were no hard feelings. Let's face it, there couldn't be, as I was the one that put them in the business, so our relationship was quite amicable. In fact, Dennis used to arrange social gatherings for all eight of us - Dennis and his Finnish wife Daria, Malcolm and Maureen, Ashley and Brenda, and myself and Ann. He would find the most exotic restaurants in the West End and we would dine like kings. From my point of view, they were real 'on top' gaffs - the food was rubbish, but it was served up in beautifully decorated establishments with lots of pomp. There were waiters wearing silver goblets round their necks and other nonsense.

Like me, Dennis also grew up in a council flat. He saw his new status as a massive elevation. Ashley viewed it as something he was
always
owed and was
always
going to achieve one day. Malcolm went along with the flow, while I sceptically looked on at these deluded moguls.

I haven't bothered to mention the usual trappings of wealth, such as cars, but by that time I was driving a Jensen, Dennis was running around in an Aston Martin, Ashley also had a Jensen and I think Malcolm had something a little more modest, like a Jaguar. To be honest, I was the only one who really warranted such a prestigious car - the others were simply living off the cash flow generated by their schemes.

If there's one thing I learned from this exercise, it was this: if you decide to work with a partner, make sure you know their abilities. Also, do a bit of due diligence to see if all that glitters really
is
gold. It just so happens that I had the foresight to get out, but I should never have got into that business in the first place.

*

As I've said before, in comparison with modern fathers who get involved in the upbringing of their children, I have to admit that I fell a long way short. I missed out on a lot of my kids' childhoods. Most days I would leave the
house before the kids were up and I'd get home after they were in bed. At weekends I was quite selfish - I was tired and really needed to recharge my batteries. Weekends normally consisted of taking the kids round to see my mum and dad or Rita and Johnnie. Occasionally, there would be the odd treat, like taking them to the zoo, but apart from that, the only time I really spent with the kids was when we went on holiday.

One thing I did do regularly was take the two boys for a Saturday morning ride in the car. Our journey took us by the local airfield at Stapleford, where we would stop and have some refreshments and watch the small planes taking off. During my visits there, I started to ask what was involved in flying aeroplanes. It looked very exciting and after talking to some of the people in the flying club, I decided that I would embark upon a course and get my flying licence. This didn't go down too well with Ann. She felt it was a dangerous hobby that I shouldn't take up, considering all my obligations. More to the point, it would consume some of the little time I had to spend with the kids at the weekends.

I guess I
was
a bit selfish, but it was something that interested me and allowed me to relax a bit away from work. I accumulated fifty-five hours and passed my aviation exams and flying test. I became a qualified pilot in 1976 and went on to buy my first aeroplane, a single-engine Grumman AA-5, G-AZVG.

I used to take the kids flying sometimes, although they were a little nervous, particularly Simon. Daniel was more up for it, but Louise was too young. She wasn't big enough to sit in the passenger's seat.

My flying exploits took me across the Channel to places like Le Touquet, Toussus-le-Noble and Paris. But mostly I went to other airports in England, such as Biggin Hill, Shoreham or Elstree - just for the sake of landing.

I won't waste too much time talking about flying because it's something the majority of people wouldn't understand. To most people, flying is all about the need to get from A to B, but most of the time we flying saddos just go up, fly around in circles and then come back to base. To have control of a brilliant piece of engineering, defying gravity, is a great feeling, one that's hard to convey.

*

In early 1976 Johnnie and Ann recognised that Rita's health was deteriorating. Mr Noone told Johnnie there was not much more he could do. For many months, Ann would bring Rita round to our house during the day, so that Johnnie was able to concentrate on his work. Everyone was trying to keep Rita's spirits up. It was a terrible time. Sadly, in December 1976, less than two years after that phone call in Tokyo, Rita passed away.

As young people, both Ann and I were devastated. While we had witnessed Izzy's death, it was the first time that we had experienced the death of a parent. We'd also never seen anyone deteriorate the way Rita had. Towards the end, Johnnie arranged her bed down in the lounge, as she couldn't even make it upstairs.

The plans for the funeral were hampered by the fact that Rita died on a Friday and it was too late to arrange her burial that day, due to the Sabbath. In the Jewish religion it is customary that one has to bury the deceased as quickly as possible. Regrettably, Rita's body remained at their home in Eastern Avenue for two days. Meanwhile, the house was swamped with relatives bringing condolences to Johnnie, Ann and Mark. My mum and dad came to visit. I remember my mum catching a terrible fright when she came across Rita's body on the floor of the lounge, wrapped in blankets.

As many of us know, the death of a parent or someone close to you is a very traumatic event. The week that followed - with the funeral and the shiva - was a terrible time in Ann's life, and it must have been the same for Mark.

Johnnie was absolutely devastated. It was difficult for him - this upstanding, confident man - to try to hold back his emotions. But the whole family gathered round and stayed throughout the whole shiva. Then came that hollow moment when, on the last day, the family left and Johnnie was on his own. He put on a brave face. Nearly two years of a nightmare was over. Rita died at forty-eight, an incredibly young age.

Rita's death also changed our home situation. Effectively, Ann had another person to care for, as Johnnie spent lots of time round our house during the day while I was at work. Ann would make him meals and generally look after his welfare.

One highlight for Johnnie after Rita's death was the arrival of Mark's second child, a girl, and she was named Rita. This Rita was to go on to become famous as an actress in
EastEnders.

Mark was working in his father's electrical business, but after a while it became clear that there wasn't enough work and income for two people. Johnnie was operating from home, selling stuff over the phone, and it was a nice little niche, but it only brought in just enough money for himself.

I introduced Mark to Ashley, who had decided to open a second branch of Global Audio in Redbridge. Mark was installed as the manager of that shop. It was a job he needed, despite the fact that I suspected it might not last.

*

Sticking to my principle of concentrating on high-ticket items, my sales success, in particular with cassette decks, must have made an impact with our ultimate supplier, Orion. This was no longer small-volume business by anyone's standards and one day I received a phone call from Mr Yonezawa from the London office of Orion Electric Company summoning me to meet the Orion boss, Mr Otake, at the Churchill Hotel. Initially I refused, thinking this would be unethical. I'd never had any direct dialogue with Orion - all my transactions had been through Waco. I'd learned that one had to respect the supply chain - it's very bad business practice to go behind one's supplier's back. However, I was assured by Yonezawa that if any new business did result from the meeting, it would be transacted via Waco. In fact, an hour or so later, I received a telex from Ronnie Colson saying I would be contacted by Orion and, as far as he was concerned, it would be fine for me to meet the boss. He warned me that Mr Otake was a very strange man and that I should take care in how I spoke to him, as he was very proud and pompous in the traditional Japanese mould, where bosses were like emperors. I didn't pay much attention to Ronnie, but I was to find out at the meeting, and over the next few years, what a raving nutter Otake was.

I was met in the lobby of the Churchill Hotel by Mr Yonezawa. With typical Japanese efficiency, he had a photo of me (taken by Ronnie) so he could recognise me. He took me to Mr Otake's suite and invited me to take a seat while we waited for the boss.

And then, the Emperor made his appearance. He was a short, plump man in his mid-fifties with dyed, jet-black hair. He shuffled as he walked across the room and placed himself in the larger armchair. I had remained seated and realised later that Otake had already taken exception to me, as I hadn't sprung to attention and stood up. Speaking in broken English, Otake expressed his surprise at how young I was. Yonezawa spoke good English and translated the finer details of our conversation.

Clearly Otake was no fool. He'd recognised that sales of our cassette decks were larger than he'd seen in any other market, and he was eager to find out what made my business tick.

I went on to explain to him the necessity of producing a Dolby version of the cassette deck. Dolby was a noise-reduction system designed to eliminate the hiss commonly experienced on tape-recordings while maintaining the high-frequency components of the music. It was my initial thought to run two models: the existing one and one with Dolby, for which I could charge a premium.

I advised him that if his company needed any technical assistance in incorporating Dolby, we would be able to help. Suddenly, in a Tommy Cooper-like move, he produced a box from beside his chair and showed me a sample of a new design of cassette deck - with Dolby! The sample was a mock-up, a non-working plastic model with no guts. The mock-up had the Dolby logo printed on it, although at this point Orion did not have a licence to produce Dolby products.

The mock-up was very impressive, much better than the cassette deck we were buying, but I didn't show that much enthusiasm. Instead, I abruptly asked the price.

Otake got the hump and exclaimed, 'I don't like this way. You do not say, "It is good." I don't like aggressive asking price. This not way I do business.'

I was taken aback - all I'd asked was how much!

He got up and walked out into his adjacent bedroom. 'I don't like this meeting. You go, Sugar.'

I would learn later that this was one of the games he would play. Yonezawa explained that Mr Otake was a very important and respected man in Japan and he did not take to people being as blunt as I was. I was being warned to watch my ways when talking to him.

I shrugged my shoulders. 'I don't understand what I've done wrong, but in any case, if I have insulted Mr Otake, please apologise.'

I wasn't so stupid as to let my feelings rule my head. Instead, I put business first and humoured Mr Otake. After some ridiculous farce with Yonezawa going to and fro between Otake's bedroom and the living room, the Emperor re-emerged.

He announced, 'We don't need your business. We have big business in England with Mr Michael Raymond. We are making twenty thousand per month music centre for Mr Raymond. Your cassette deck business is peanut business for me. I am here to help you.' Uncharacteristically for me, I just sat quietly and let him rant. Then, after about ten minutes, it got to the point where it was acceptable for me to enquire as to the price.

When I first started trading with Shomei and Waco, the Japanese yen was 685 to the pound, but the rate had deteriorated to around 530. The proposed price Otake quoted me for this new model, albeit a superior product with Dolby circuitry, would have meant a 50 per cent increase in the retail price over the current model. I explained to Otake that the Japanese yen was causing me problems and that even the model I was buying was becoming unprofitable. I told him I'd been hoping to explain why we needed a price reduction on the existing model, let alone discuss a new model.

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