Arcadia, which boasts the Topshop, Dorothy Perkins, Burton, Evans, Wallis and now BHS brands, has been battered by recession and undergone a wholesale corporate restructuring. But, despite reported losses by the BHS chain (the business has £56.3m debt on the balance sheet), Arcadia is still posting healthy profits. In 2009, earnings were up 13% to £213.6m.
This was down, in part, to a lucrative deal with Kate Moss. The supermodel has designed a series of Kate Moss for Topshop collections- the 14th hit the shops last month. In 2007, turnover at Topshop increased 10% of the back of this joint venture. But Green has announced that the partnership is coming to an end. "It has been fantastic for us and fantastic for her," Green told The Times. "But [the designs] take more and more time and she cannot do this full-time anymore."
Both parties insist that there are no hard feelings but rumours that Green's daughter Chloe is poised to take the reins abound. And the plot thickens. Moss' collections were off to a flying start three years ago, with 2,000 women queuing around the block to grab one of her iconic designs. But it was a different story in 2009, with the collection simply selling 'well' with some lines just 'okay'. This final collection, a swansong for Kate Moss for TopShop, should see a return to form, however.
With this joint venture coming to an end, Green is showing his hard nose. The financial uncertainly of the past year has prompted the Topshop tycoon to trim the fat from his various businesses. The deal with Kate Moss was worth upwards of £3m to the supermodel - it will cost considerably less to keep style decisions in the family from now on.
As for his plans to downsize the real estate portfolio of his brands, Green has said that some 300 smaller stores will be phased out when leases come up for renewal. This still leaves over 2,100 stores open for business, although Green may yet consolidate a few of his high street brands under the BHS umbrella.
It's nice to see that, after lambasting government for overspending last month, Green is practising what he preaches.