LONDON, United Kingdom — In the unforgiving game of retailing, the Weston family have long proved nimble players.
Over the better part of a century, they turned a Canadian bakery into a transatlantic empire that sells everything from groceries to $1,600 Gucci handbags. Along the way they amassed one of the world’s biggest fortunes and befriended another influential clan — the British royal family.
But now the Westons, who spent four generations mastering the vicissitudes of retailing, are being put to the test by Covid-19.
It remains to be seen if customers will stream back to Selfridges & Co. and Fortnum & Mason, the family’s luxury emporiums in London. And the Westons’ decision to shun online sales at their value fashion chain Primark, a major source of their wealth, may backfire if social distancing permanently alters consumer behaviour.
That contrarian approach helped Primark undercut rivals and become one of the world’s fastest-growing apparel chains, with sales rising 46 percent from 2015 to 2019. It has 79,000 employees and 380 locations in 12 countries, including a mega-store in Brooklyn, New York. During this year’s lockdowns, Primark’s monthly revenues plunged to almost zero from £650 million ($806 million).
The pandemic has done more than gut revenue at retailers. It has disrupted the flow of goods to sales floors and forced the cancellation of high-end fashion shows that influence what styles consumers will buy next year.
“The supply chain is broken, the fashion calendar is no longer in place, and who wants to be out buying designer brands with all the social questions we’re asking ourselves right now?” said Thomai Serdari, who teaches luxury branding and marketing at New York University’s Stern School of Business. “There’s too much happening at the same time. We have to rethink this industry.”
On Thursday, Primark parent Associated British Foods Plc, which also produces sugar, agricultural goods and foodstuffs, is expected to release its latest sales data. Last year, Primark generated half of the company’s revenue and almost two-thirds of its adjusted operating profit.
The Westons, a sprawling family with a penchant for naming their male children with the letter G, are divided into two branches. The Canadian side has taken on a more public role, with matriarch Hilary Weston serving as the lieutenant governor of Ontario in the late 1990s. Loblaw Cos., a publicly traded chain of supermarkets and drugstores with 200,000 employees and 2,400 locations, is a longtime fixture in Canadian shopping centres.
There’s too much happening at the same time. We have to rethink this industry.
W. G. Galen Weston, the 79-year-old grandson of dynasty founder George Weston, derives much of his wealth from a majority stake in George Weston Ltd., a Toronto-based food-processing company that controls Loblaw. His wealth has dropped 15 percent this year, to $7.8 billion, according to the Bloomberg Billionaires Index.
The UK side of the clan has preferred to keep such a low profile that their name doesn’t even appear in the online history of Fortnum & Mason, an iconic brand they’ve owned for decades. Their holding company, Wittington Investments Ltd., has a 54.5 percent stake in ABF. The family’s philanthropic arm, the Garfield Weston Foundation, owns 79.2 percent of Wittington and individual members control the rest. Last year, the charity disbursed more than £88 million in grants.
“There is a symbiotic relationship between the business and the charitable foundation,” said Philippa Charles, the foundation’s director. “We have to sell a lot of trousers and socks and bread to give away more money, and we do not take that responsibility lightly.”
Representatives of both sides of the family and its companies declined to comment.
Galen and his wife Hilary have pursued a lifestyle that could have sprung from an episode of “The Crown.”
They’re friends of Queen Elizabeth II and Prince Philip. When members of the Irish Republican Army made a failed attempt to kidnap Galen in 1983, he was playing polo with Prince Charles. For decades, he and his Irish-born wife Hilary, a onetime model, have held court at Fort Belvedere, an 18th century English mansion the couple lease from the Crown Estate. The couple were so enamoured with their place in England that when they developed an upscale residential community in Florida they christened it Windsor. A Canadian magazine called it a “plutocrats’ playground.”
The Westons trace their fortune to 1882, when 18-year-old George Weston, the American-born son of British immigrants, hung up his apprentice’s apron and started a bakery in Toronto. His son, W. Garfield Weston, expanded to the UK in 1935, laying the foundation for ABF.
Over the decades, he added household brands such as Twinings tea and Ovaltine, as well as Fortnum & Mason. He set up the ownership structure with the foundation in 1958. It went on to support education and conservation efforts, and helped fund construction of the Great Court in the British Museum, a vast plaza enclosed by glass and steel. Warning his children that great riches can destroy as well as create, he imbued the clan with an ethos of rectitude, according to a chronicle published by the charity.
To this day, the family maintains a hands-on approach to their ventures. Galen and Hilary’s daughter, Alannah, 48, is the chairman of Selfridges Group, and her younger brother, Galen G. Weston, 47, is chief executive officer of Loblaw and its parent. A cousin, George G. Weston, 56, runs ABF. An outsider, Ewan Venters, is the CEO of Fortnum & Mason, and he has extended the brand with locations in Hong Kong, Heathrow Airport and the St. Pancras railway station in London.
Located near Piccadilly Circus, Fortnum & Mason’s food hall has long attracted shoppers eager to sample caviar, foie gras or Scotch eggs, a fried sphere of breaded ground pork with an egg at the centre that some claim was invented in the shop centuries ago. On June 17, the only thing visitors could try was Fortnum & Mason’s rosemary hand sanitiser. The store, usually thronged at lunchtime, was relatively quiet.
Things were different at a Primark store in Wood Green, a diverse working-class neighbourhood in north London. Shoppers waited in line for more than 30 minutes in a scene that was repeated at locations throughout the UK.
Just like another “fast fashion” chain, Inditex SA’s Zara, Primark takes styles inspired by the catwalks of Milan and other fashion capitals and rapidly turns them into affordable clothing for the masses. With more than 10.3 million followers on Instagram, Primark stimulates buzz for new lines with savvy social media content.
While Inditex, controlled by Spanish billionaire Amancio Ortega, is investing heavily in its e-commerce capabilities, George G. Weston remains wary of making big changes for what he has called a “once-in-a-hundred-years event.”
With concerns mounting that new coronavirus outbreaks are coming, he may have to rethink that stance in coming weeks.
“In a Covid-19 world, there is no doubt that retailers with advanced online capabilities are better positioned than those without them but adding one would not be easy,” said Morningstar analyst Ioannis Pontikis. “This is indeed one of those big decisions.”
By Edward Robinson and Deirdre Hipwell.