Speech, which cost a billion dollars

Word not a sparrow ... Have you ever said something about what eventually regret or would like to take it back? In any case, it is unlikely your careless words can you do to almost a billion dollars, as was the case with Gerald Ratner in 1991.



Ratner was CEO Ratners Group, the jewelry firm that shook the cruel and unwavering jewelry market by selling some of their products for the poorer sections of society through a network of shops Ratners.

Despite the fact that the chains and other ornaments production of this firm press and other jewelers widely ridiculed and considered tasteless, a lot of wishing to buy a product without spending exorbitant amounts flocked to the 1980s in these stores throughout England, making Ratners in common noun .



When in 1984, Ratner had inherited the company, it has expanded its network from 150 stores to more than 2,000 just six years, capturing more than half of the UK jewelery market. Ratner was extremely gifted businessman.

In his autobiography, "Gerald Ratner: The Rise and Fall ... and then take off," Ratner said that his success in the 1980s due to the fact that, having studied the market, he noted that the greatest success achieved not by those who sell the best products, and those who most loudly touted customers and had the most striking attention-grabbing signage. Ratner has applied this concept to their business by providing all stores Ratners bright orange screens that gaudily advertised prices and offers.





This tactic, combined with low prices blew sale. At the peak of the company's success Ratner was invited to speak at the Institute of Directors in front of a group of prominent businessmen and journalists to the story, how he managed so quickly to develop your company. This statement has since gone down in history as one of the businesses biggest mistakes.

Although some time performance was very smooth, it came the fateful moment when someone in the audience asked him a very simple question: why the company can not afford to sell items so cheap? His infamous response was as follows:

"People say, 'How can you sell at such a low price?" I answer: "Yes, because it all - even the cheap».

While Ratner argues that he said it all as a joke and thought that his speech will not reach the general public, since it was a closed event, journalists are still heard it. The next day, his comment was in all the national news.

This affected the company's profits almost instantly. During the night the shares fell in price by 500 million pounds (about 936 million pounds, or 1, 6 billion dollars today), and clients began to avoid stores Ratners. The phrase "act Ratner" entered the lexicon of the English language to mean "really screw it up».





During the year after the performance Ratner Ratners shops began to close hundreds, leaving thousands of people lost their jobs. It is quite obvious that the blow to the groin in a loss of half a billion pounds, the company received only because speech Ratner.

Although his speech was worth many hundreds of millions of dollars, he Ratner came out of the scandal relatively unscathed. He said in an interview that "sold their shares on the same day and left. The only good news for me was the fact that one billion pounds sterling - debt, not mine ».





Currently, Ratner is working in the jewelry business, with an estimated cost of about 35 million pounds, or $ 59 million. In his spare time he occasionally earns extra money by giving speeches at business conferences.

«I tell people that even if you are haunted by failure, whether the bankruptcy, divorce or illness, there is no reason to think that this is the end. Making your audience laugh, I rise to new heights and I understand that now I am no longer the arrogant snob who was once ».

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