Winston Churchill once quipped “My wife and I tried two or three times in the last forty years to have breakfast together, but it was so disagreeable we had to stop.” Fortunately, the attendees at the inaugural FRP Breakfast Club were much better company than the Churchills found each other (or, I think it’s safe to assume, much better company than Winston was for the long-suffering Clementine).
And those attendees really were treated to a feast – both literally in the form of bacon butties, and metaphorically in terms of the quality of the discussion, (at least from my fellow panellists), retail guru and former Debenhams CEO, Steven Cook, and Elaine Nolan, the highly regarded Restructuring Partner at Kirkland & Ellis. With FRP’s own Clare Quinn-Waters directing proceedings, we spent a good hour in conversation ranging across a wide landscape of topics.
For my own part, there were three key messages that really struck home and gave me pause for thought. Firstly, Steven made the point that we don’t give enough credit to those retailers who have successfully navigated one of the most economically challenging periods in recent memory. It’s easy to look back with twenty-twenty hindsight and question the strategic choices of those who haven’t made it through, but back in the heady days of 2019, who could have anticipated the changes that would be needed just to survive? Companies have had to be agile and adapt rapidly, particularly when it has come to evolving for a much more digitally-reliant market.
Elaine built on this point, but noted just how much more challenge there is still to come. With the ONS data from February hot off the press showing the highest annual CPIH inflation rate since May 1992, and the OBR pointing to further increases towards the end of the year, Elaine mused on the impact on consumer confidence. And we’re still to see the full effects of energy price hikes and the full impact of Russian sanctions impacting on the wider economy.
Finally, I appreciated Elaine’s insight into the new commercial rent arbitration regime. It’s something we’ve been flagging for a while and Elaine gave some fascinating insights into the proposed six-month moratorium on protected rent for non-paying businesses. I’m not sure it’s widely appreciated that the arbitrator is going to have to decide the viability of the tenant and the insolvency of the landlord. We’re still at the final stage in the House of Lords, but there’s a lot to digest. A bit like the second helpings of breakfast that I treated to myself after the guests had departed!