Technology; Novelty value
Business was alien to Jonathan Elvidge. Now his gadget shops are worth millions. By Benjamin Mee. Photograph by John Angerson
Saturday 05 June 1999
But it was during one such Christmas Shopping Panic that Jonathan Elvidge first had the idea for The Gadget Shop, "I always hated Christmas shopping," says Elvidge. "Rushing around at the last minute, ending up with terrible presents. And, as a big gadget fan, I was always looking for a place which just sold unusual, innovative gifts." Intensive research told him that there was indeed a gap in the market. "I went to trade fairs until they were sick of me," says Elvidge. "They'd say, 'Here comes that nutter with the imaginary shop.'" But soon he was convinced he had stumbled on the entrepreneur's holy grail - an untapped human universal trait, in this case a fascination with gizmos.
He decided to commit himself completely to the project. Giving up his job as a telephone engineer and remortgaging his house, he launched his first Gadget Shop in 1990 in Prince's Quay, a new shopping centre in the centre of Hull. Unfortunately, 1990 was also the middle of a recession. "And I launched in March, which I now know is the worst time for retailers," says Elvidge. "Interest rates were at their highest, retail spending at its lowest, and the locals weren't entirely sure about Prince's Quay. We were a new format too, with everything under glass, which one fellow trader kindly informed me would never work."
But Elvidge also had a stroke of luck. He got shafted on his rent by landlord Andy Hobb. "He knew nothing about negotiating," says Hobb, the man who shafted him. "I said, 'Right, it'll be pounds 35,000 for the year,' and he just said 'OK.' So I said, 'And while you're fitting out I won't charge you rent for those six weeks.' And he said, 'Oh, great.' He could have negotiated a much lower rent and a free refit if he'd known what he was doing." The lucky bit for Elvidge was that it got Andy Hobb watching him very closely.
Swimming with the sharks in such hostile waters could have been the death of Jonathan's project, but for the strength of the basic idea, and Andy's subsequent intervention. "Exit polls showed shoppers rated The Gadget Shop as their second favourite shop in the whole centre," says Hobb. "So I said, 'Come with me, and I'll make you a millionaire. And I have, 25 times over." Hobb's initial pounds 25,000 investment is now also worth pounds 25m.
The Gadget Shop spans 25 towns with 28 shops. The latest two opened in central London recently, first in Piccadilly, then in Covent Garden. Within weeks of opening, each became the new record-grossing store within the company. This is partly because Elvidge has tapped into a demand - "People love gadgets, there will always be new ones, and we will always keep up to date" - and partly due to the placing of the shops.
At 35, Elvidge has made a decision to enjoy his position as much as possible, like getting his private pilot's licence, sponsoring the first English women to trek to the North Pole and then flying out to meet them.
"I don't open envelopes any more," he says. "Just packages. The heavy, interesting ones." He buzzes between offices, deciding on logos, fiddling with gizmos and trying to get me to play with his paintball blowpipe. Meanwhile, Hobb is equally passionate about the width of the doors in the shops. "Most of ours have a good 3m span," he enthuses. But Covent Garden bucked the trend by becoming the biggest-grossing shop despite having doors which are only 80cm wide. The entire door-width-to-profitability ratio was out of the window.
With his slightly detached view of his customers being sucked into the gaping jaws of his stores, Hobb is definitely the hard man of the outfit. Jabbing an imaginary map on the table, he recalls encouraging investment in Prince's Quay in the Eighties by flying retailers over Hull in a helicopter. "Most towns quickly thin out when you get above them.
"As the high street shrinks you start seeing sheep or moors in the distance. Hull just sprawls. Then it dawns on the retailers there are 100,000 people down there." And every dwelling contains wallets, purses and credit cards which will inevitably be carried to Prince's Quay - and through the 3m doors of The Gadget Shop.
Most retailing is the art of gently prising small sums of money out of large numbers of people, and The Gadget Shop does this exceptionally well. Keeping products under glass makes them seem more attractive, cuts out theft, and doesn't waste any precious shelf-space storing stock. "M&S make pounds 5m on pounds 100m turnover," says Elvidge. "We make that on pounds 25m." With 50 per cent of that turnover taking place in the last 10 weeks of the year, as far as Elvidge is concerned, Christmas Shopping Panic is now a Very Good Thing - and something his love of gadgets has helped him capitalise on even more. "In many ways my best gadget is the touch-screen till system we developed, which automatically feeds stock information back to the central warehouse," he says.
As shopping centres begin to clog up in November, the warehouse works 24 hours restocking each shop every day. Elvidge sits at the centre of a machine whose tendrils are feeling the pulse of the crowds, taking the blood pressure of the feeding-frenzied beast and turning the numbers into money. And, for the rest of the year, he does what he likes to do best. He goes around the world shopping for interesting and unusual presents, at a nice leisurely pace
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