That attitude helped turn Sugar into a very wealthy man, but it didn’t do much for Amstrad computers, which, as former users can testify, often seemed to operate as if rubber bands were, indeed, their key component.
The son of an East End tailor, Sugar has proved throughout his career that he knows how to make a good profit. Where he has perhaps been less successful is in making a good product. The man himself would no doubt dispute that charge and cite in his defence that three million Amstrad owners couldn’t all have been wrong. But to many Amstrad soon became a joke name in the hi-tech world and was effectively ousted from a multibillion market.
Nowadays, Sugar’s fortune, estimated to be around £800m, is derived mostly from property investments. In this respect, he is a paradigm of British industry: a short-term manufacturing phenomenon dwarfed by the more lucrative business of property speculation. As such, he is an ideal figure to front The Apprentice, a programme that seeks to promote the British entrepreneurial spirit, and returns this week for a fourth series. The Apprentice is a kind of assault course for salespeople. It’s the perfect game show for a nation that is far more concerned, for example, with selling mobile phones than producing them.
And Sugar performs the role of The Apprentice’s head honcho with great authority. With his brusque manner and pugnacious features, he is a surprising TV natural. The camera can’t be said to love him, but he appears to love it and the strange chemistry unmistakably works. Sugar’s chief asset on television, and quite possibly in real life, too, is that he is genuinely scary. His facial expression seems permanently set to go off. The impression is informed by a forbidding reputation.
The late John Harvey-Jones once said of Sugar: ‘I never liked Alan. I always thought he was a bully. His values are, in my view, totally irrelevant to the needs of business. I watch his programme with horror.’ Sugar dismisses the bully charge, pointing out that he has sacked very few people in his career and that he can’t very well show his more mellow side on TV because it would undermine the drama.
Nick Hewer, a longtime employee of Sugar’s, who has also appeared as one of his advisers on The Apprentice, has said: ‘He’s not cuddly. I’ve seen him being charming, but it’s not an everyday thing. He can be pretty gruff with his friends, too. He can tear into you if you’ve made a mistake.’ One advertising executive who worked on an Amstrad account in the 1980s recalls Sugar’s staff being ‘absolutely terrified’. He lambasted one creative director with a string of expletives because he mentioned that he had won an award. ‘He is by far the most profane person I’ve ever met in business,’ says the ad man.
It should be said that Sugar dislikes advertising people, along with stockbrokers, management consultants and marketing directors, though not nearly as much as he dislikes journalists. ‘Scum’ is the word he has used to describe reporters. His greatest animosity, however, is reserved for footballers – ‘bigger scum than journalists’, in fact ‘the biggest scum that walk on this planet’.
Sugar prides himself on being one of the few people in history to make money out of football. He certainly made very few friends. Things started out well when he bought Tottenham Hotspur in 1991, thus saving the club from the twin threats of liquidation and Robert Maxwell. But two years later, he sacked his partner, and the fans’ idol, Terry Venables. He showed considerable fortitude in dealing with the acrimony that followed and managed to place the club on a sound financial footing. But in terms of success on the pitch, his tenure was a period remembered for mediocrity and underachievement.
Arguably, his most significant move in football was the backing he gave to BSkyB’s offer for television rights which, according to some witnesses, was instrumental in swinging football to the satellite channel and thereby saving Rupert Murdoch’s business when it looked in danger of going under.
His other notable contribution was exposing football’s ‘bung’ culture. In so doing, he railed against corrupt practices and venal footballers. Yet after a succession of dismal failures, he appointed George Graham manager, who just a couple of years earlier had been found guilty by the FA of misconduct in accepting payments from a Norwegian agent.
He sold the club in 2001, though he remained the biggest shareholder until last year. He has described his experiences at Tottenham as a ‘waste of 10 years of my life’.
The end of March sees Sugar’s 61st birthday. He was the fourth and last child of a Jewish couple and grew up on a council estate in Hackney, east London. ‘I came from a very poor family,’ Sugar has said, ‘where life was all about not having any money, not having anything and working very, very hard. I didn’t want to have to live that way. While I was at school, I was making more money, selling bits and pieces, than my father was earning.’
His school years ended when he was 16. He then set up selling car aerials out of a van. When he was 21, he started his own company Amstrad, a derivation of Alan Michael Sugar Trading. His first major breakthrough came when he began using injection moulding plastics in hi-fi turntable covers, instead of the more expensive vacuum process used by competitors. He then used the same price undercutting with amplifiers and tuners. ‘Sourcing cheap materials has always been his main strength,’ says one former employee.
He moved early into the home computer market, selling his simple PCs to a new, technophobic market. At one stage, Amstrad’s stock was valued at more than £1bn. But the company was unable to respond to an increasingly sophisticated market and suffered from second-rate components.
‘I think we kick-started the revolution,’ he later acknowledged, ‘but possibly, having a trader’s instinct in me, I didn’t invest enough in recognising that we should enhance the technology and make it a bit more sexy.’
It’s the British way, which is why so few consumer goods are made by British firms. Amstrad’s only significant post-1980s successes have been the BSkyB-related – Sky dishes and Sky set-top boxes. Therefore it was no surprise when Sky bought Amstrad last year in a £125m deal that left Sugar as chairman.
He divides his time now between a home in Chigwell, not far from his modest Brentwood offices, a mansion in Boca Raton, Florida and another home in Spain. Though some way from the most ostentatious of the super-rich, he enjoys the symbols of his status. His Rolls-Royce bears the number plate ‘AMS1’. He recently sold his yacht and upgraded to the seriously wealthy’s preferred pastime – flying. And, since being knighted in 2000 for services to business, he insists on being called ‘Sir Alan’.
The year after his knighthood, he donated £200,000 to the Labour party. He changed his allegiance from Conservative – he was a great admirer of Margaret Thatcher – to New Labour before the 1997 election. Recently he said that Gordon Brown’s government was ‘not Labour, it’s old-fashioned Tory’.
He advises Brown, of whose work ethic he approves, on business training for children. He is an advocate of the so-called Mcqualifications, non-academic training for shop and service workers. ‘What we need,’ he says, ‘is to train the person who stands behind the fish counter at Waitrose to be an expert on fish.’
This makes excellent sense, though one would think that it wouldn’t require a business genius to make it; indeed, I’ve often expressed the same sentiments at my local supermarket. But the point is supermarkets tend not to train fishmongers because they prefer to maximise their staggering profits. And this is precisely the cynical message that The Apprentice preaches, cynical in the Wildean sense of knowing the price of everything and the value of nothing. The ethos of quality – respect for skill, knowledge, craftsmanship – is conspicuous by its absence in many areas of British society and most glaringly in those driven by a short-term profit motive.
Sugar took the job on The Apprentice because he wanted to be a role model. So keen was he that he requested no payment and when the BBC insisted, he gave his money to the Great Ormond Street Hospital. And in many ways – his self-made status, for example, and charitable donations – he is a fine example. But it’s nevertheless true that while the public may appreciate the hard hours he’s put into his business, and the hard cash he’s taken out, as regards the business itself, they mostly look down, not up.