Newspaper article The Christian Science Monitor

Laura Ashley: No Longer Resting on Its Florals

Newspaper article The Christian Science Monitor

Laura Ashley: No Longer Resting on Its Florals

Article excerpt

LAURA ASHLEY, known for its floral fabrics and flouncy frocks, has donned a new management style after three years in the red and a close brush with bankruptcy.

Jim Maxmin, who came on board as chief executive officer in September 1991, is hauling the English retailer's management into the '90s.

He is refocusing the company on its Welsh design heritage after it bought a number of other small companies and took its eyes off the clothing and household-furnishings business.

Dr. Maxmin is confident that the appeal of the Laura Ashley brand - country-cottage romanticism - is as great as ever. The 5 to 8 percent of women who make up the retailer's core customers are the same the world over, according to the company's market surveys - well-to-do, well-educated, cosmopolitan, environmentally conscious, and capti- vated by things English.

But because the key to the business is building a relationship with those people who love and share the lifestyle captured by Laura Ashley, Maxmin says, the company needs to get back to basics and serve the customer.

The challenge for Maxmin, an outsider in the 39-year old family business, was to turn around what he terms a "dysfunctional" management and reverse a 20-percent slump in sales. The company, he says, was divided into little empires, each with its own complex hierarchy and accounting and computing systems.

"It was really no longer Laura Ashley - it was six or seven strategic business units," Maxmin says. "Everyone had their own stock {inventory}, which drove up the borrowing and that's what almost bankrupted them."

Added to this, the North American headquarters in Mahwah, N.J. employed 354 people to supervise 160 shops.

"So here you have this niche {market} and you have a company that's fragmented out of existence," Maxmin says.

But the CEO, who regularly flies between London and Laura Ashley's new North American headquarters in Boston, is restructuring with some success.

He knocked out the top 116 managers, cut the top off each business unit, globalized and integrated operations, and gave sales people the authority to innovate and serve the customer as they saw fit. …

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