Too Much Honesty (2/27)

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There was a big chain of jewellers in the UK called Ratners, which was known for its brash advertising and cut-price sales. At the head of the business was chief executive Gerald Ratner. On 23rd April 1991, Gerald stood on stage at the Royal Albert Hall, addressing a conference at the Institute of Directors. During that speech, he would utter 44 words that would destroy his business.

He said: “We also do cut-glass sherry decanters complete with six glasses on a silver-plated tray that your butler can serve you drinks on, all for £4.95. People say, ‘How can you sell this for such a low price?’, I say, ‘because it’s total crap.’ Tabloid newspapers jumped on Ratners’ remarks and the event blew up into a national scandal.The chain’s value plummeted by approximately £500 million and its collapse was only averted by closing 330 shops in the UK and US.

Contributor: Will Craig, CEO from leasefetcher

Written by James Metcalfe

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