Currys dulls brightness of display TVS to slash energy bills

Alex Baldock, chief executive of Currys, tells Laura Onita why he won’t let the cost of living crisis derail his plans for transformation

CURRYS has reduced the brightness of televisions on display in its stores in an attempt to save money as energy prices soar.

The retail chain, which has 300 shops in Britain, is also turning out every other ceiling light in shops and installing more efficient LEDS at pace across its outlets as it seeks to save energy.

Alex Baldock, chief executive, said: “We’re doing things like dimming the brightness of some televisions when stores are less busy and turning out every other light and installing LED lighting across the network, all of which is self-help.”

Retailers around the world are expected to put energy-saving measures in place this winter as the cost of running stores jumps as a result of a major energy crisis.

In July, Currys said it had to fork out an extra £8m for energy costs for the year to April 30.

Mr Baldock added: “We’re being a bit more careful about the energy consumption in stores.”

Currys’ initiatives come after French luxury fashion house LVMH said it would turn down the thermostat in its stores and urged staff to take the stairs instead of getting in a lift. As well as lowering heating in shops, lights in stores will be switched off between 10pm and 7am and office lights will go off from 9pm. The changes will be welcomed by climate change campaigners in France, who have been trying to get retailers to switch off their illuminated lights at night for years.

Primark is also looking to cut energy costs by fitting more LED light bulbs in stores. In Germany the chain is now required to switch off all lights at night, one analyst said. The cost of running its hundreds of shops is set to rise by £100m this year, up from £50m in 2021.

Running an electricals retailer is a tough job at the best of times but selling television sets, mobile phones and gadgets is only getting tougher as the cost of living crisis prompts cash-strapped households to cut back.

Last week’s market crisis heaped yet more misery on chief executives like Alex Baldock, who has been leading a turnaround attempt at Currys since 2018.

“Every business wants stable policy, stable economics, not least price and currency stability, and those things breed confidence,” he says. “We could do with some of that stability right now.”

Large technology suppliers were swiftly seeking to charge more for their goods after sterling hit an all time low against the dollar last week, threatening to derail Currys’ promise that it won’t be beaten on price.

“With all the heft we carry, we can resist that better than other retailers, but not entirely, and some price rises are inevitable,” he says.

Putting up prices is the last thing the 51-year-old wants to be doing as he seeks to battle a years-long decline in Currys’ share price.

“The consumer needs help through this cost of living crisis,” he says. “I do welcome the Government’s [energy] support, not just for consumers, but for businesses as well, that’s been essential and decisive. But equally, every business craves a stable environment.”

Businesses were already reeling from surging costs such as energy and labour as well as supply chain disruption. Smaller rival AO World was recently forced to raise £40m to shore up its finances, while global players such as Electrolux have warned of a steep drop in demand for home appliances.

Despite returning the chain to reasonable financial health since he took over in 2018, Currys, formerly known as Dixons Carphone, was forced to cut its annual profit forecasts in July. The stock is down by more than 70pc since he took over and close to hitting just a tenth of its all-time peak reached in 2015.

“Ultimately, that’s how this turnaround, and I personally, will be judged,” he says, nearly four years into his revival plan.

“I find the investors super supportive, they understand what we’re doing, they understand that we’re taking what was a good bricks-andmortar retailer and repurposing it for the modern world by adding online [sales] and adding services.”

Baldock has earned a reputation for his cool-headed – some would say mechanical – approach to running one of the country’s leading electronics retailers.

During a tour of Currys’ repairs depot in Northamptonshire, an employee pulls him aside.

“Colleagues are taking the mick because I did an internal video after our meeting with investors and my [shirt] collar was sticking out,” the chief executive explains.

The uncharacteristic wardrobe malfunction was a rare occasion when he did not appear entirely composed in front of his 32,000-strong workforce – they were amused.

“When you meet him, he’ll come across as reserved,” says Lord Wolfson, the boss of Next. “My view is, it doesn’t matter if you’re an introvert or extrovert, what does matter is the quality of your thinking and the effectiveness of your implementation, and he’s very good at that.”

Lord Livingston, Currys’ former chairman who hired Baldock, said: “He’s incredibly hard working, diligent and he’s a very good listener. He doesn’t get ruffled easily. Intellectually, [he is] very, very strong, which means he can process multiple things at once.”

That skill has been incredibly useful in recent years as Currys was forced to confront not only the transition to online but also Covid-related supply chain disruption. At the beginning of the pandemic, Baldock closed all 531 Carphone Warehouse stores in the UK to simplify the business, leading to 2,900 job losses. He later severed ties with some of the big phone networks to gain more flexibility on price. Clickand-collect services were added and live video shopping was introduced for customers stuck at home.

Currys is now focusing on credit deals and low prices in an attempt to drive sales and ensure customers don’t defect to rivals. It is also increasingly promoting repairs, rather than just the latest whizzy gadget.

“We want to help shoppers get started with a laptop, get the most out of it, as well as sell them shiny new kit,” he says. “The way we do that is through repairs. We have Europe’s largest electrical repair facility with 1,000 colleagues that has 3m products passing through it every year.

“That’s obviously great for the planet, but it’s also good for customers’ pockets because in the midst of a cost of living crisis, repairing stuff is on people’s minds.”

Baldock insists repairs are profitable and a strategy worth pursuing. Pre-tax profits were up significantly in the 12 months to April, but Currys recently lowered its margin target from 4pc to 3pc through to 2023-24.

Some industry observers believe the retailer, which already commands a quarter of the market in the UK, will struggle to grow as it jostles for trade with the likes of Amazon and John

‘There are real benefits of scale. We matter more to customers, we matter more to our suppliers, and we have no intention of letting go of those’

Lewis. It accounted for 25.6pc of sales in the UK electricals market in 2021-22, down slightly from 25.8pc in 2018-19.

“There are real benefits of scale,” he says. “We matter more to customers, we matter more to our suppliers, and we have no intention of letting go of those. We’ve said we will grow steadily.”

Baldock is quick to admit he has had a “comfortable and privileged” upbringing. He was born in Dorking, Surrey, but grew up in Paris. “French used to be my first language,” he says, with no detectable accent.

His father came from a working class family and joined the army before becoming a salesman for consumer goods giant Procter & Gamble. He climbed the ranks to eventually run Guinness and briefly chair Marks & Spencer. Baldock’s mother, “a super bright woman”, was his father’s personal assistant.

Aged 13, the young Baldock was “packed off to an English boarding school” – Oundle, near Peterborough – where “he loved his sport”, especially rugby. He went on to read modern history at Worcester College, Oxford. When he graduated, he didn’t have “a particular calling beyond a vague sense that I wanted a business career” and secured a job as a management consultant at Kalchas. He spent 12 years advising businesses, living in Japan, Singapore, the US and Switzerland.

He then became a commercial director at Barclays and, three years later, the managing director of Lombard, a division of Royal Bank of Scotland. “I’m sometimes described as a former banker, I don’t really see myself that way. It was a financial services firm that was rash enough to give me my first P&L [income statement],” he says.

Wolfson dismisses Baldock’s modesty, saying: “He’s got the combination of: he’s very intelligent and he can get things done. Those qualities don’t always go hand in hand but they do in Alex.”

After Livingston hired him, a rival retailer got in touch to say: “You’ve recruited the smartest guy in retail.”

Baldock says: “This is a transformation that might take a little bit longer than I would have envisaged, there have been a couple of curveballs along the way. But I’m sitting here with enthusiasm, with passion and belief that we’re going to do it.”