Upbeat Peat back on track

Trade

Ben Peat is running a business that is now on it’s second life. Peats World of Electronics has officially exited examinership and is now a train on a much smaller gauge track, but with plenty of focus.

The Parnell Street-based business has been running since before the Second World War and really is a household name. A second-generation family member, Ben Peat has been managing director at the firm for about 25 years and is a true retailer at heart.

On the topic of government performance he is less than happy: "Talking about budgets now is detrimental to the retail environment" he said. "To my mind they are trying to sound out the general public – to soften us up. Pre-Christmas is a crazy time to have a budget."

Like many other retailers he knows that budgets and pre-budget "leaks" put the brakes on consumer spending and creates a negative feeling of uncertainty among the public about their pensions, their jobs, their savings.

Environment

Peat is equally clear on the competitive the retail environment. "It is all about value for money" he said. "When you have a special offer it sells". He says his biggest competitors are PC World, Harvey Norman, DID and Power City. Of the latter he is highly complementary: "Power City are a very sharp operator. I think they are the only ones making money" he added. His biggest bone of contention is the continuous downtrading of the customer. "They shout about price reductions, not about the technology" he said, highlighting how important it is to sell the features and advances rather than always focussing on price.

The slide of Peats World of Electronics into examinership had been well flagged in the mainstream media. The company expanded in the early years of the last decade, taking expensive leases in high-profile sites for six Sony branded outlets and five multi-brand Peats shops. Then in 2007 came the decline. Ben said that the staff saw what was happening and understood that change and cost reduction was necessary, but that the landlords were less than flexible. "If the landlords had been proactive in 2007 and 2008 we could have kept most of the shops open" he said, explaining that he personally dealt with the landlord, showing them the figures and telling them the facts.

Some landlords offered abatements, but no reductions. The pressure was on landlords to keep the headline rents under the leases intact. "You’re telling them facts and they don’t believe you. They know that if they concede everybody else will be clambering for deals." said Peat, recalling his frustration at a situation where he would talk to an agent who would report to a landlord who would go to the bank that might be operating on behalf of NAMA. There were no answers and it was a stressful time for the man who worried about the business and could clearly see the decline.

Ben Peat feels that they were a responsible company. "We expanded through cash-flow and re-invested into the business. We didn’t go mad borrowing millions.. We saw the opportunities and it all made sense".

By 2011, although there was money in the bank, he could clearly see it running out after a long period of declining sales. "We decided to hang on through Christmas, but the sales in December 2011 and January 2012 were very disappointing. We saw the writing on the wall."

Shocked response

The decision to go "before we were pushed" was taken as Ben was anxious to protect the family name.

An early set of advisors steered the company in the direction of liquidation and on 2 April 2012 the staff were told and a creditors meeting on 23 April was announced. Within hours it was all over the country and on the nine o’clock news. "I couldn’t get over the response and support from staff, suppliers and customers" said Peat, who following the announcement, met with other accountants who persuaded him to take the examinership route, which process left the company intact, albeit with just the store in Parnell Street, another in Rathmines and an online business.

Ben Peat is happy to be back on track. "It’s not just pounds, shillings and pence. It’s family, life and heritage. We’re in for hopefully breaking even over the next number of years" he said, accusing those who feel otherwise of "fooling themselves". "It’s all about keeping the doors open and staying alive" said the man whose company sold many of us our first colour TV, upgraded our mono radios to stereo and ushered in the era of the Commodore 64 and the Sinclair ZX Spectrum.

TechCentral Reporters