Key man joins Harrods exodus

HARRODS has lost one of its most senior and longest serving directors - and he is the 12th top executive to part company with owner Mohamed Al Fayed in little more than two years.

William Najdecki, group finance director and administration director, has quit after three and a half years.

The American-born executive was a director of 13 companies under the Harrods group umbrella, but he has resigned all his positions. He was one of only six people who sat on the board of Harrods Holdings alongside Al Fayed and his brother Ali Fayed.

A company spokesman said Najdecki was leaving by 'mutual consent' and that he would be returning to the US to send his daughter to university and to pursue 'other business interests'.

But his departure after the loss of so many other senior executives is seen as a heavy blow to the group.

Al Fayed has already lost three key staff this year. Directors Jon Brilliant and Andre Maeder resigned, and Adelle Kelley, the head of womenswear, left in February after only seven months at the famous Knightsbridge store.

Last November, managing director John Whitacre quit after little more than seven months and last August Al Fayed's aide Mark Griffiths resigned over allegations of financial irregularities.

Few of the executives who have departed have given reasons why, but Al Fayed, who has a reputation for being charming, is also known as a tough and demanding businessman.

He is also one of the most colourful figures in the world of retailing that boasts more than its fair share of larger-than-life characters.

The establishment was rocked in 1985 when the little-known Egyptian-born businessman burst on to the scene with an audacious £615m offer for Harrods to its then owner, House of Fraser. The takeover followed a bitter and protracted battle with rival tycoon Tiny Rowland, boss of the Lonrho conglomerate. That feud continued long after Al Fayed had snatched Harrods away from Rowland.

It was a conflict that outlasted Rowland - Al Fayed had to pay Rowland's widow £1.4m to settle a court battle over gems allegedly stolen from her safe deposit box at Harrods.

But despite his lack of an establishment pedigree and all the connections regarded as necessary at the time, Al Fayed set about reviving the fortunes of Harrods. The Knightsbridge store is now regarded as one of the must-see landmarks for visitors to London - usually well-heeled Americans. Up to 30,000 people visit the store every day, rising to more than 100,000 during its celebrated sale.

This has its downside. Tourists do not always spend money and the Americans who could usually be relied on to run up large bills in the 36 separate departments of Harrods that range across six floors are in short supply. September 11 stopped American travellers in their tracks.

And as they were once again thinking of digging deep in their pockets to come shopping in London, their sense of affluence was hit by the massive stock market rout.

Even Al Fayed's close friendship with legendary shoppers such as Posh Spice Victoria Beckham would be hard-pressed to make up such a shortfall.

Figures for the latest financial year, which would show the effect of September 11, have not yet been filed with Companies House. In the year ended January 2001, the Harrods empire reported a £56.6m loss.

A profit of £3m after tax was turned into loss after the group paid out £59.6m in dividends. But in a recent interview with the Financial Times, 69-year-old Al Fayed admitted that there had been a 'significant downturn' in shoppers at the store. He said that he had been forced to use his personal fortune to help support the business.

A company spokesman said Harrods was likely to make a profit of about £29.1 million for the year just ended, though the group is predicting a slight improvement in the current year.

Al Fayed, who says he wants to build himself a glass mausoleum on the roof of the store, is believed to have planned to float part of Harrods in New York earlier this year, but the global gyrations in share prices appear to have put those plans on the back burner.

At one stage, Harrods claimed the float plans had been an elaborate April Fool joke.

The delay may also have been affected by the sudden decision of Harrods' auditor, PricewaterhouseCoopers, to give up the account. It is still not clear what brought about the split because PWC cited 'client confidentiality' as a reason for refusing to comment on the unusual move.

Al Fayed, who also has great plans for his Fulham football club, subsequently told the FT that he would like to float at least part of the Harrods group on Wall Street, though he has not put a time scale on that. Despite not taking cash from the stock market, Al Fayed did raise £350 million from the banks in new funding and said he had at least another £50 million more to invest in the Harrods business.

After 17 years at the helm, Al Fayed is still a hands-on boss, spending several hours each day touring the Harrods business.

But it is not clear whether he or his plans have been unsettled by the recent spate of executive departures. Though Najdecki stayed nearly four years with the group - long enough for one observer to joke that it qualified him for a long service medal - many others left far sooner.

Muriel Singraff lasted only two months in the fashion and beauty departments before quitting in April, while last December saw the departure of former Conservative MP Charles Wardle. That came hot on the heels of managing director John Whitacre, who went in November. Anne Pitcher, fashion director, had left the month before. In 2000, Andrew Wiles, Laurie Mayer, Donald Norman and Dawson Parker were among the highlevel departures.

Staff turnover at all levels of retailing is notoriously high, and in his interview with the FT, Al Fayed said: 'It is not especially unusual for there to be a turnover of people at all levels. The casual observer may consider several senior departures in one year as a matter worthy of comment, but there is really nothing untoward. Some have left because they have failed to meet expectations. As many people who work with me will tell you, I do make great demands of my people.'