Family affair paid the price for complacency

A CENTURY after John Sainsbury opened his tiny cheesemonger's shop in London's Drury Lane, the fortunes of the chain that bore his name could not have been more in the ascendant.

By the centenary year of 1969, there were 247 Sainsbury's supermarkets with turnover per square foot twice that of its closest rival, a downmarket outfit called Tesco.

In a poll that year, 45% of housewives rated Sainsbury's top in value for money terms and 49% rated it best for quality. The Tesco figures were 13% and 7%.

Despite having floated 3% of the shares, the company was mainly owned by the clan and seven of the 11 directors bore the family name. It was the start of the reign of John D Sainsbury, a great-grandson of the founder who was later ennobled as Lord Sainsbury of Preston Candover.

A generation later and the business empire founded by the two John Sainsburys is in crisis. The derided upstart rival Tesco is now the colossus, Sainsbury's the laggard.

The last of the family directors, David, quit as chairman in 1998, ushering in a new and unsuccessful era of outside management. The family share, down to less than 35%, is widely spread among 14 members of the fourth and fifth generations.

There is talk of the family selling part or even most of its remaining holding, which is in blind trusts controlled by lawyer Judith Portrait. Others say there are plans for a family 'rescue' of the firm by taking it private.

Whatever the fate of the business, the Sainsbury clan is now woven into the fabric of the Establishment. Until the death of Alan, Lord Covent Garden (chairman from 1956 to 1967) four years ago, there were three Sainsburys in the Lords. One, David, is still a minister in the Labour Government. His cousin, Sir Timothy, was a Tory minister.

But the conveyor belt of grocers that for more than 100 years churned out Sainsburys to run Britain's favourite food retailer is no more. Sir Tim's daughter Camilla is best-known for marrying Tory-turned-Labour MP Shaun Woodward, while John's son Mark helped found trendy Islington restaurant Moro.

Meanwhile, the business slides from humiliation to disaster. Soon it will be overtaken by the merged Morrisons/Safeway group, pushing it down to fourth in the supermarkets Premier League.

The days when John D Sainsbury could arrogantly boast 'we may never be the world's biggest grocers but, by God, we'll make damn sure we keep trying to be the best,' suddenly seem a very long time ago.