Can former Rangers boss revive Scottish firm Sterling?

The Herald Scotland

a day ago

Around this time last year, the Tillicoultry-based company was looking forward to what it hoped would be a brighter future following a difficult spell. After implementing 50 redundancies and closing stores in 2023 in response to a 'historic lack of action taken to address the cost base', the company's then chief executive, John Pattison, spoke boldly of awakening a 'sleeping giant' in an interview with The Herald in May 2024.
'I think Sterling has phenomenal potential to realise,' Mr Pattison declared at the time. 'It has been a solid business across five decades now but, given the foundations we have, the next decade could be really exciting [with] very interesting opportunities coming to us.
'With a new strategy in place, [there is] an opportunity for us to really grow into something quite special, something that both the family who own the business, the team, and indeed Scotland can be proud of.'
As far as one is able to detect in interview situations, it was clear Mr Pattison – a veteran of the furniture industry – held a good deal of confidence in the potential of Sterling. But in business there are always events that are beyond the control of company chiefs, and so it seems to have proved for Sterling.
Despite the hopes expressed by Mr Pattison, 2024 proved to be a tumultuous year for both Sterling and the wider retail sector. As consumer confidence was laid low by high interest rates and painful inflation, putting pressure on retail sales across the board, the company itself faced rising operational costs. The latest accounts for Sterling, which The Herald covered exclusively this week, highlighted 'legacy decisions and over-investment in anticipation of growth that did not materialise', as the company slumped to a loss of nearly £4 million for the year ended August 31, 2024.
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Mr Pattison left the company in November, and a new leadership team has been installed, led by chief executive Stewart Robertson and chairman Bernard Dunn.
The new team quickly took action to further address costs at the retailer, with an unspecified number of redundancies – largely in operational roles – announced in February. This move came ahead of significant cost rises in April, when the increases in employer national insurance contributions and national living wage, announced by Chancellor Rachel Reeves in the Autumn Budget, took effect.
In an interview with The Herald this week, Mr Robertson, a former managing director of Rangers Football Club, gave a sober assessment of the difficult trading environment Sterling and the wider retail industry faced during the period covered by the accounts, and continue to encounter, as the outlook for the UK economy remains bleak.
Mr Robertson, also a former secretary of Motherwell Football Club, signalled that the changes made since his arrival – his appointment as chief executive is now permanent after he initially joined on an interim basis – have solidified Sterling's foundations and put the company in a position to return to growth.
Further investment is planned, including an overhaul of the company's flagship store where the launch of a new leather gallery later this summer will form part of plans to bring the 'magic dust' back to its Tillicoultry home. Mr Robertson also suggested that Sterling, which was founded by George Knowles in 1975 when he converted an old mill in Tillicoultry into a furniture showroom, could open further stores, and perhaps return to cities such as Inverness that it had previously exited.
But he emphasised that the strategy would be anchored on 'careful growth'.
Reflecting on the actions that he and Mr Dunn, a former head of insurance broker TL Dallas in Scotland, have taken since joining the company, Mr Robertson said: 'It has been a case of really looking at what the business has needed, and we have re-set the cost base [to] make sure we have got really strong foundations to take the business forward in a sustainable way, but also in a way that is going to grow the business as well. There are still opportunities there for us [but] it needs to be considered growth, it needs to be careful growth.'
He added: 'There are areas where we are not located but maybe were in the past. Take Inverness, as an example, that is an area we would certainly look at going back into if a good site became available at the right cost. A number of the economics would need to stack up, but certainly there is a desire to do that and to look at continuing to grow the organisation, but doing it at the right time in the right places with the right level of investment.'
That Mr Robertson sees an opportunity to grow one of Scotland's most venerable retailers is surely to be welcomed by those with the interests of the Scottish economy at heart, and not least because of the 440 people the company employs across its 10 stores and other operations.
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There are likely to be generations of Scots who wish Sterling well. Some of a certain vintage will fondly recall the long-running television adverts for the retailer voiced by sports presenter Dougie Donnelly in the 1980s (featuring the famous catchline 'Sterling, Tillicoultry, near Stirling'). Others will recall the days, as Mr Robertson noted, when people would go to visit the Tillicoultry store for a 'day out'.
But powerful though nostalgia is, fond memories will not be enough to ensure success, as Mr Robertson will know only too well. At a time of subdued economic growth and continuing concern over the cost of living, and with competition tough on the high street, plotting Sterling's return to growth will not be easy. But at least Mr Robertson can go about his business without the glare and constant scrutiny that characterised his time at Rangers.