PEOPLESCPC STAFF ★ A legend in his own lauchtime ★

Sugar Story #1 : A legend in his own lauchtime (New Computer Express)Peoples Cpc Staff
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In the first of a major Express series, one time Amstrad man William Poel charts the early days of the Sugar empire. This week, from beetroots to hi-fi battles.

Beetroots. Not exactly the most pre-possessing of objects, and not exactly the most obvious basis for the greatest commercial phenomenon in the UK computing world. But beetroots it was that started the young Alan Michael Sugar off in his quest to make inconceivably huge piles of cash as quickly as possible. And never underestimate a man who can turn the dullest of vegetables into money in his early teens.

Alan comes from a very typical East End background, born (under lucky stars) in 1947 in Hackney. Both parents worked in the rag trade, but from an early age young Alan caught on to the opportunities that exist around us all to trade in just about anything where a market can be found. The tales of his early business exploits are legion and legendary in the classic "East End boy made good" style of anecdotage.

Alan's first trading exploit was to boil beetroot for the local greengrocer, getting up at a ludicrously dark hour of the early morning to do so. Then there was the photographic phase and the repackaging of bulk film. Meantime he obtained a number of O-levels, and although stories differ on this next point, I believe he also has three science A-levels.

But whatever the actual detail, it should be clearly understood that despite his cultivated street trader approach to business and his disdain for intellectuals and "boffins", Alan Sugar's no academic slouch - one reason why he manages to maintain the whip hand so readily over his suppliers and staff. Never underestimate his mental agility.

Had he been as motivated by the prospect of certificates and academic achievement as he was by money, he would be a professor of his chosen subject by now - and about £500,000,000 poorer.

Money won hands down. Since his family background was by no means deprived, the Legend of Alan reveals no particular motivating force for his desire to get his shovel into huge mountains of money, other than a larger than average desire for the better things in life. And rather more of them than the next bloke, please.

Aerial assault

Alan moved along into anothej good Jewish tradition in the East End, and worked with an electrical wholesaler. This led to the famous phase of selling car radio aerials from the back of a van, and many small electrical shopkeepers round East London can remember the days of having to give this energetic young lad a shove to restart his van (why pay good money for a new battery when you can get someone to shove it for free?). From there, it was a short step to wheeler dealing in that notorious street of high tech tick tackery, Tottenham Court Road.

By keeping overheads low and applying his brilliant salesmanship he could form Alan Michael Sugar Trading by the age of 21. And using his astute observation of the marketplace and where opportunities arose, Alan had launched into several niches in the audio trade.

After the legend of the aerials came the legend of the plastic record player covers. A £5,000 investment in tooling produced a player top for around 50p a moulding, and this sold for up to £15. This confirmed in the young Sugar's mind that the way to make serious money was to make huge profits, and to avoid any use of his rapidly growing capital that did not reflect around a 10,000 per cent return.

This was an important ground rule fixed in the corporate philosophy If you cant earn at least 30 per cent from a product, get out, and find somewhere that you can. And the other keystone in his philosophy: the world is full of mugs willing to work for peanuts, so let them.

Today's Mr Sugar also kids his audience that attention to detail was one of the factors in Amstrad's success. Frankly (a favourite expression) that is a load of crap (another favourite expression); attention to detail only came with the computers after getting a severe drubbing in the audio market because of a total lack of attention to detail.

This charming man

Alan Sugar is impatience personified. He usually doesn't bother to say 'Good Morning" on his hurricane-like progress through the building to his penthouse. The debate as to whether this is actual boorishness or an eccentric obsession with the myriad pressing matters that surround a huge business revolving around one man's judgement continues.

It's quite possible that Sugar (eels that manifestations of common courtesy after all this time would cause serious concern that he's getting soft in his dotage. In his personal life (very well hidden from his public life), he is a model family man, with a stable marriage that goes back to the days before anyone could possible accuse Anne of marrying the old man for his money. This tends to support the view that Sugar's abrupt behaviour is a carefully studied and cultured approach to intimidate and inspire.

Inspire he certainly does. His core of long term staff (lifers) continues to treat him with a reverence usually reserved for a religious leader. In a way, this is a serious parallel, and the object of worship at Amstrad is profit. The burning question is whether or not the operation is so utterly obsessed with profit that the Amstrad mob would desist from armed robbery if they were 100 per cent certain they could get away with it.

Uncertainty on this score is what probably unnerves many of the genteel city observers, whose own particular brand of unarmed robbery has a social acceptance amongst their peers.

The Mug's Eyeful Tower

Anyone who ever owned one of the earlier Amstrad audio products will realise that the next step along the road for Alan was the conception of the Mug's Eyeful.

The Mug's Eyeful is where Alan's brilliance really shot to the fore. Take an expensive audio product, reproduce its facade, shove in something salvaged from a tinny radio chassis, and the lorry driver and his mate will come flocking. It's just like the back-lot film sets where the front of the Gone With The Wind mansion is in fact a plywood mockup, propped up by a load of four by two.

The equipment looked a million dollars, but actually cost very little. Outlets at places like Comet and Rumbelows were sold the product by Sugar's superb salesmanship, and the trip towards flotation as a public company was well under way.

Basically he looked at the Japanese route to success and did a very effective imitation for himself. He might correctly be described as Britain's one-man economic miracle.

But all the time the kosher piano was playing frantically away in the background. Alan continued to take short cuts with etiquette and the finer points of English management technique. His abrasive and direct manner lead to problems with the old school, although all those with whom he does business have nothing but praise for his integrity and reliability.

Sugar's general view of business progress is based on need-to-know. He managed to surround himself with a relatively unqualified but highly loyal staff who exhibited the key ability to learn as they went along (with a couple of exceptions). As new markets appeared and new products were devised, Amstrad boys picked it all up as they went along: but computers were a different thing as we shall see.

However, the cloning of the expensive look took a step back when blatant copies of one expensive Japanese loudspeaker design led to an order to destroy a ton or two of the Amstrad look-alikes. This lesson was well learned and Alan then took a closer interest in copyright laws and made very certain that when the foray into IBM land came along, he was properly prepared. Before then, though, he had a more elementary battle on his hands: how to launch Amstrad as a computer manufacturer, just when the bubble was beginning to burst for Sinclair, Commodore, Acorn and Atari

Men maketh micros

Some men are born to have difficulties with selling micros, some achieve difficulties and some have those difficulties thrust upon them.

The UK micro computer industry has been a curious contrast of personalities. All have had great ideas but then all have had even greater problems. With the exception of a certain Mr S., all have flirted with financial
death. Some have even succumbed.

Firstly, there was the urbane, reputedly insufferably arrogant self styled guru and visionary Sir Clive Sinclair. He may not quite have been only the boffin of popular imagining, but he needed a Sugar in shining armour to keep him afloat. Then up popped the terrible twins of Hauser and Curry. They can thank the patronage of the BBC for rocketing Acorn from obscurity into a wasteful monopoly of the educational sector, thereby putting a whole generation of UK computer users behind the competition
around the world while the iBM PC became the standard.

At the business end, there was the down to earth Brummie accountant who nearly made it huge, but insisted on being just different enough to nearly sink Apricot: Roger Foster. He, at any rate, is bouncing back these days.

All have been off-stage bit-part players in the Alan Sugar Story. He'd've succeeded without them, of course, but their considerable troubles made it that much easier for the Sugar takeover to occur.

The five quid a second approach to making money

Let's get one thing straight. Alan Sugar deals with computers much as he does any other commodity, as a means to an end; and the end is profit. Huge, grotesque, unimaginable and enormous amounts of it. Amstrad regularly achieves the impossible in terms of the net margins it maintains on its trading, doing at least twice as much as conventional wisdom would believe possible.

The profits accrued are too huge to be meaningful. In its last reported figures for the 12 months to June, Amstrad made £160,400,000. That's the equivalent of £439,452.05 each and every day of the year. Or to put that another way, Alan and the boys make £18,310.50 per hour, even when they're not working. And further, that means £305.18 per minute or even £5.09 per second tips into the Amstrad coffers.

So by 9.00 am on January 4th 1989 when most normal folk will only just be starting the year after the holidays, Amstrad will already have notionally earned the pretty sum of £1,483,150.65...

NEXT WEEK:

The birth of a notion.
Demystify computers by bundling the CPU monitor and disk drive/cassette together, make it all run from one plug, ramp up the Amstrad marketing machine behind it. and you're onto a winner with the CPC But it wasn't quite as simple as that.

New Computer Express #3

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L'Amstrad CPC est une machine 8 bits à base d'un Z80 à 4MHz. Le premier de la gamme fut le CPC 464 en 1984, équipé d'un lecteur de cassettes intégré il se plaçait en concurrent  du Commodore C64 beaucoup plus compliqué à utiliser et plus cher. Ce fut un réel succès et sorti cette même années le CPC 664 équipé d'un lecteur de disquettes trois pouces intégré. Sa vie fut de courte durée puisqu'en 1985 il fut remplacé par le CPC 6128 qui était plus compact, plus soigné et surtout qui avait 128Ko de RAM au lieu de 64Ko.