Joseph Chamberlain (1836-1914) the radical nineteenth-century businessman and politician who terrified Queen Victoria and many others, is back in the news again.
The man who broke not one but two political parties has been twice cited by Prime Minister Teresa May as an inspiration. Her joint chief of staff, Nick Timothy, has even written a pamphlet about him (Timothy, 2012). Once-despised concepts like ‘industrial strategy’, city mayors, educational excellence and the regions are back in fashion again. What can this mean for retail strategy?
Keen readers of this website will know that our ploy is to see all activity through its impact on shopping and shopkeeping. Hence the title of this page is ‘Joseph Chamberlain and Retailing’. Admittedly, this is not the most obvious slant on Joseph Chamberlain. In fact it may be a world first for us.
Starting as a shoemaker, then manager, of the family store in Cheapside, London, he was sent by his father to Birmingham to look after the family interests in a new engineering company. Chamberlain and Nettlefold under Chamberlain’s leadership combined new engineering technology with excellent management and sales skills to become the largest manufacturer of screws and fastenings in the UK, making worldwide sales. The company was the precursor to today’s GKN and Chamberlain himself became a millionaire, in the days when ‘millionaire’ meant very, very rich indeed.
‘Gas and Water Socialism’
Birmingham’s population had grown rapidly in the nineteenth century (by +358%, 1801-71), but comparatively little had been done for this population. There were shanty towns, acres of slums, poor sanitation, an inadequate water supply, and comparatively few schools.
Chamberlain became mayor of Birmingham in 1873, determined to put right decades of neglect. Declaring, ‘in twelve months the town shall not, with God’s help, know itself’, he started a rapid overhaul of the town and its administration, which made him a legend of municipal activism.
The town bought out the local private water companies at a time when 80% of homes had no piped water supply and the others had water for only three days a week. Birmingham Water Department replaced private companies and was run efficiently as a non-profitmaking concern. Chamberlain thought it immoral to make a profit from a necessity like water. The death rate in central Birmingham had risen in ten years from 14.6 per thousand to 27.2 per thousand, but the changes made on his watch cut the death rate by one-half in five years.
Chamberlain bought out the local gas company, the profits of which were spent on the central museum and art gallery, making him a pioneer of what became known as ‘gas and water socialism’. Taking over the private water companies and the gas company was the prelude to launching a massive Improvement Scheme. The scheme eliminated 50 acres of slums in central Birmingham (Chamberlain provided £10,000 of his own money [£1mn in today’s money]) to the project.
‘The Best Run City in the World’
The degraded buildings in the town centre were replaced with wide streets including the new Corporation Street, and new shops and offices to enable Birmingham to become the commercial centre of the Midlands. Chamberlain noted that the number and quality of shops in Birmingham was well below what should be expected for a town of that size. Slum clearance was actually profitable for the town because the council made speculative profits on the land and paid comparatively low compulsory-purchase prices. The leases on city centre property were set by Chamberlain to expire in the late 1950s/1960s, which he planned so that the Council would then become the outright owners of the town centre. There were heavy debts of course from this municipal activism.