MIPIM: The large-scale soft sell

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For most people, a 24-hour stay in France is more likely to mean Calais than Cannes.

However, my fleeting visit to the scenic coastal resort, famous for its film festival, was perhaps the polar opposite of picking up cheap cigarettes and alcohol.

I joined the 25-strong Leicestershire delegation attending the MIPIM conference with the aim of wooing major investors to the county.

This was the biggest presence the county had ever had at Europe's largest property fair, and it will hopefully be even better next year. It was also the first time, to my knowledge, a Mercury journalist had attended in an official capacity and the first time I'd ever been there myself.

I am currently writing a number of pieces about what the delegation got from MIPIM for Tuesday's Mercury Business Weekly, so cannot spend too long on this blog. All I'll say was that after years of being told that I needed to be there, the event didn't disappoint.

There is the serious business stuff, of course, like meetings with international property big hitters. There is also the sheer scale of some of the exhibition stands, particularly London and Russia's (see picture) And there is the fact I ended up meeting key regional business people I'd only previously spoken to on the phone - although this is something I'd always been told would happen.

Then there's the social side, the good relationships you foster and the fact you get to speak to big decision-makers with multi-billion pound budgets in an informal, relaxed environment. The fact it just happens to be against the magnificent backdrop of the French Riviera makes it all the more pleasurable.

But whatever people say about it being an expensive junket, it's pretty obvious MIPIM is important. You only need to look at all the effort made by cities, regions and businesses to grab your attention in the huge exhibition hall. However, there is no hard sell, because it's more about the size and effectiveness of your presence. Pushing leaflets at people just wouldn't wash.

And of course, it wouldn't be France without something strange and amusing happening. One that stays in the mind was the incident with the driver who took such exception to our mini-bus driver trying to jump a queue he ended up stopping in the middle of a busy slip road to remonstrate with him. However, our fears of a punch-up soon subsided as the pipe-smoking Jean-Paul Sartre look-alike turned out to be a doctor on his way to an urgent call.

What followed was more a detailed discussion about road etiquette than a raging argument.

Things are done more subtly in France, which is why MIPIM seems to work.

MIPIM: Leicestershire attracts global investment interest

Leicestershire business and council leaders attending Europe's largest property fair have attracted strong interest from potential investors.

Leicester mayor Sir Peter Soulsby and Leicestershire County Council leader Nick Rushton are heading a 25-strong delegation at MIPIM in Cannes to showcase 29 development sites in the city and county.

The pair today met London-based financiers and a major regional construction firm to discuss possible deals to redevelop the New Walk Centre site in Leicester and Loughborough Science Park, next to the town's university.

Bosses of the proposed 300 million pound Motor Industry Research Association (Mira) technology park , near Hinckley, said they too had attracted interest from businesses.

The delegation's exhibition stand, featuring images of Richard III and Leicester Tigers and a scale model of the proposed Mira technology park, has helped to woo global companies looking for investment opportunities.

Andrew Bacon, chairman of Leicester and Leicestershire Enterprise Partnership (LLEP), which organised the delegation, said: "We have managed to build some very good relationships here."

The Leicestershire delegation, which is being funded by 17 private sector sponsors, was to host a showcase event on the Cannes beach front on Thursday afternoon.

MIPIM, which began on Tuesday, will run until tomorrow.

UPDATE: Leicester City: More details from those record-breaking accounts

Some people have been asking me for more details about the club's plans to convert its loans into shares.

When I spoke to the club's senior management on Friday they said they were unable to give details on the plan at this stage.

All they were able to say was reported by myself in Saturday's Leicester Mercury.

Here is the relevant paragraph, originally published in Saturday's Mercury.

The club's chairman, Vichai Srivaddhanaprabha, owner of Thai duty-free business King Power Group, took over the club in 2010 after a £39 million deal with previous owner Milan Mandaric. He has given the club loans totalling £61.6 million since he took control, but hopes to eventually convert these loans into shares in an arrangement similar to what has been seen at Chelsea and Manchester City.

Such a move would further underline the owners' commitment to the club. It would also significantly reduce the overall debt.

It seems the owners are looking at this with the Financial Fair Play rules in mind. We now know the loans made by King Power could total between £61.6 million and £77.2 million. The club is paying 8 per cent interest on the majority of these loans.

The debt-to-equity conversion would work, I understand, by the club issuing more shares to the owners and those new shares representing the value of the loans which are being converted.

Leicester City: More details from those record-breaking accounts

Like a good book, I’ve found Leicester City’s 2011/12 accounts hard to put down since being handed a copy of them at the weekend.

The 31 pages of documents make fascinating reading, not least because the main plot revolves around a £29.7 million loss, believed to be the highest deficit ever made by a Championship club.

I wrote a story on page two of Monday’s Leicester Mercury based on these accounts. It revealed a further £14.6 million of funding had been pumped into the club by the Thai owners since the start of the season. However, it is not totally clear in the accounts whether this cash is in the form of a loan, like the other £61.6 million provided by the owners between when they took control in 2010 and May 31, 2012.

A close inspection of the accounts will show this extra funding figure could actually be £15.6 million as there seems to be a discrepancy.

The £14.6 million figure is given on page 17 of the accounts. But on page seven and under the heading ‘subsequent events’ on the page 31 of the accounts it talks of £15.6 million of new funding. But what's £1 million between friends?

Page 31 also says the additional funding of £15.6 million was given to the club between May 31, 2012 and November 30, 2012. The accounts were signed off by the club's vice-chairman on December 1.

Other highlights of the 2011/12 accounts which haven’t yet been reported are;

The club made an operating loss of £25.1 million, compared to £14.3 million the previous season. This will be of interest because the Financial Fair Play rules which come into force next season are based on operating losses and not pre-tax losses.

The accounts say £67.5 million is owed to owner King Power, with £63.1 million bearing interest of 8 per cent and £4.4 million at 6 per cent. The £5.9 million difference between this and the £61.6 million put into the club as loans by the owners up until May 31, 2012 could be because the higher figure includes interest payments owed and some kind of fees.

The club had 35 players on its books on May 31, 2012, compared to 24 the year before. These players were valued at £20.7 million on May 31, 2012 compared to the £7.2 million the 24 players were valued at 12 months before.

The total pay of the highest-paid director – either chief executive Susan Whelan or one of the two Thai owners - was £133,000, down from £173,000 the previous year, when Lee Hoos was chief executive.

Co-operating with capitalism

My father, like many of his generation, can still tell you his family's Co-op 'divy' number 50 years after he last used it. In the days before supermarket loyalty cards, the divy (a form of dividend which related to how much you'd purchased over a certain period) were the reward points of their day.

He and his parents were regular shoppers at the Co-op food store in Coalville, which 50 years ago was based in Marlborough Square. They also bought goods from the nearby Co-op department store. Later I would get my shoes throughout primary school and my parents would buy many household goods from the same Belvoir Road store.

As with many working class families in that era, the Co-op offered an affordable way of buying quality groceries, clothes and homeware. Remembering your divy number would mean you might be able to buy something extra at the end of the month.

Co-operative societies offering goods for sale were developed in the 19th century as a way of enabling workers displaced by the Industrial Revolution to buy quality food and clothing. The birthplace of the modern movement is credited to Rochdale in Lancashire - a road in Moscow was famously renamed Rochdale Street during the Communist era.

The Co-op movement, like the John Lewis Partnership, was able to adapt and survive as modern consumer-led capitalism developed. It did away with its divy system, preferring instead to focus on its reputation for quality, customer service and good ethics.

However, such virtues are not enough these days, as the growth of online retailing has made pricing and delivery infrastructure king. The Co-op has neither the cash nor the inclination to take on its larger rivals in cyberspace. Indeed spending many millions taking a brand based on principles of mutualisation and co-operation online would seem a rather redundant act given that most users regard the internet as the very embodiment of the utopian global village the hippy and eco movement strived for in the 60s and 70s. It is one of the main reasons why so many have lost money and reputation trying to commercialise the internet over the years.

These factors are behind what led Midlands Co-op to announce on Monday they were closing nine department stores, including outlets in Wigston and Coalville (pictured above), putting more than 380 jobs at risk.

I can't remember the last time I set foot in a Co-op store, whether a department store or supermarket. I'm sure there are many like me. Co-op supermarkets have developed a reputation for being both high on ethics and price. It's a tricky selling point to have in recessionary times and one I certainly don't buy into - indeed I'm sceptical about the whole 'ethically sourced' concept, but that's another blog for another day. The department (or 'fashion and home') stores suffered from the same reputation. Not only is it cheaper online, you could pick it up at a lower price at Curry's, and they have more choice and better parking. And if your priority is quality assurance mixed with the 21st century version of 'ethical capitalism' there's always John Lewis.

The closure of the two Leicestershire stores will leave large empty spaces on the main streets of two towns already suffering from numerous shop closures. The Co-op say they may have other plans for the Wigston site, but it seems there will be no second life for the Coalville outlet, which has been a fixture in the town for decades (my mum worked in the chemist at the side after leaving school at 16). It's feared it could stand empty for years after the Co-op vacates in six months' time.

It's future may be unclear, but I know for certain that next time I go past the Coalville Co-op department store with my dad, he will recite his divy number with a tear in his eye.

Jessops: A roll of negatives

It has to be one of the worst pieces of PR spin I’ve ever fallen for.

On Monday a spokeswoman for the Leicester-based camera chain Jessops told me: “Jessops remains committed to the high street.” I duly printed this in the Mercury the next day.

The company had just announced it was closing 15 stores as part of what it called “a programme to improve the quality of Jessops’ estate”.

Four days later the business closed all of its 187 shops with the loss of 1,370 jobs after plunging into administration.

It sums up the complete chaos of the past few days for the group, bringing a rather undignified end to a respected high street stalwart.

While the PR team were trying their hardest to convince me and other journalists Jessops had a future, bosses were battling behind the scenes to secure the embattled retailer a financial lifeline.

HSBC, the group’s largest shareholder, had been forced to pump cash into the business to keep it afloat, but poor trading had caused financial problems. Sensing things could only get worse, it seems product suppliers had been unwilling to extend their credit lines.

The past few weeks were pretty frantic, it seems. The announcement of 15 store closures on Monday may have been a last-gasp attempt to get suppliers on side, but it didn’t work.

When PricewaterhouseCoopers (PwC) were called in as administrators on Wednesday there was confusion about just how many stores the company had and how many staff it employed (PwC initially said it employed 2,000, but it emerged today the figure was nearer to 1,500).

It would be interesting to know how much the firm’s descent was accelerated by the sudden departure of Trevor Moore, who stepped down as chief executive in July to head music and DVD chain HMV.

At the time Mr Moore was credited with having turned around the struggling business during his three-year spell in charge. But his exit seemed to have rattled chairman Martyn Everett and I wonder how much his experience as a retail strategist and tough deal-maker was missed.

Many shoppers have questioned why Jessops relocated their Leicester store from Granby Street to Gallowtree Gate in October if they were in such distress.

I think it was part of the 78-year-old firm’s decision to go for all or nothing in the run-up to Christmas. Unfortunately, it was too little, too late.

Jessops: the camera never lies

From the handful of hits they had in their 80s pomp, Bucks Fizz’s My Camera Never Lies is probably my favourite.

But 30 years ago Britain was a very different place, particularly its high street, which boasted a number of thriving specialist retailers.

All that changed with the arrival of the internet, which pulled the rug from under a number of business sectors, including regional newspapers. But it is specialist stores such as Jessops and Cecil Jacobs it has hurt the most.

In the space of just six months both companies, founded in Leicester in the 1930s, have collapsed, with Jacobs disappearing completely last autumn. But it’s not only cheaper cameras on the internet which are to blame. Advances in software means photos can now be printed more easily on home computers and the ubiquity of technology means punters are no longer clueless when it comes to the latest gadgets and so no longer need patronising shop assistants to offer guidance.

Yes, Jessops could live on as an outlet for high-end photographic products, but it’s very likely to be with a much smaller presence than the 192 stores it currently has.

Rather arrogantly, the company’s bosses always seemed to believe the business held some great secret to selling cameras. It was floated on the London Stock Exchange in 2004 at an over-priced £160 million on the basis that demand for digital cameras was insatiable and we all needed specialist help in buying one. Then realising it couldn’t compete on price with the internet and larger retailers, it tried to turn itself into an all-encompassing photo centre. Every time it was overtaken by technology.

Yes, the 21st century consumer has an obsession with new hi-tech devices, but we are not going to pay a premium to be sold it by a spotty geek who probably doesn’t know that much more about the product he’s selling than you do. I have a passion for history as much as anyone, but ‘brand heritage’ goes out of the window when it’s £20 cheaper down the road or via the click of a mouse.

I would like to know what has happened over the past few months which has convinced HSBC - which has effectively controlled Jessops since 2009 - the business was no longer worth bankrolling when many have been reading the firm’s death rites for years. A sharp slump in sales in the crucial Christmas period probably made them realise enough was enough.

Who knows, they may have even remembered those wise words of Cheryl Baker and co.