Gerald Ratner The Boss is Back

Gerald Ratner is the boss who became public enemy number one.

People say to me, "How can you sell this for such a low price?"

I say, "Because it's total crap."

I thought because of the speech I could never sell anything again

as long as I lived.

After years in the wilderness,

Ratner re-launched his career by building a gym.

In 1997, the cameras followed Ratner as he created a new

luxury health club. He would have to overcome technical challenges...

Will the place smell of BO?

..fights with builders...

Organised chaos!

..and a bust-up with his business partner.

It's a very, very unpleasant situation to be in.

Now, Ratner is going to re-live the experience

of getting back into business.

'Everybody is very edgy and I don't normally inhale my cigars,

'but I am this week.'

And, after a 15-year rift,

he's meeting face-to-face with the friend he sacked.

You said to me you should always leave the party with who you arrive,

-you remember that?

-Oh, yeah, yeah.

But when it came to it, you didn't do that.

Gerald Ratner was once the golden boy of British business.

After building up the family firm

into the country's biggest jewellery chain, he was hailed

as the man with the Midas touch.

In 1991, he was invited to address

a prestigious conference at the Albert Hall.

What should have been his crowning moment turned into a nightmare.

We also do this nice sherry decanter, it's cut glass,

and it comes complete with six glasses on a silver-plated tray

that your butler could bring you in and serve you drinks on,

and it really only costs £4.95.

People say to me, "How can you sell this for such a low price?"

I say, "Because it's total crap."

Ratner's joke went down like a lead balloon.

Targeted by the tabloids, King Midas had become a pariah.

I made the speech in April 1991 and hung on for 18 months,

which was the worst 18 months of my life,

hired a chairman who fired me and then left,

and because all my money was in shares

and Ratner shares had gone down to nothing, I didn't have any money.

His career in ruins, Ratner was cast out in the wilderness.

I didn't have the will to work, I didn't want to play any more.

I believed everything the press was saying about me.

I had applied for various jobs

and was always rejected

and I basically gave up.

After five long years,

Ratner found a way to rebuild his career.

Because I was very depressed about my situation

and I found that doing exercise

made me feel a lot brighter.

So I was really into all that health and fitness,

and I thought the natural thing to do was open up a health club.

Ratner's vision of creating a new health club

found a home in affluent Henley-on-Thames.

After embarking on his new venture,

Ratner agreed to take part in the BBC documentary series

Trouble At The Top.

Over three months, the cameras followed him as he struggled to get

his health club off the ground.

Obviously all of this needs carpeting.

I haven't seen the carpet man.

I'm looking forward to seeing the carpet man.

Now, 15 years on, Ratner is going to witness his business rebirth

as a fitness entrepreneur.

It doesn't look like we'll have it ready for Friday.

Well, when I show people round

and say we're having an opening party on Friday night

they think I'm having one of my jokes.

I think you're having one of your jokes!

Ratner's return began at the site of a former warehouse in Henley.

His dream was to turn it into a health club called The Workshop.

It was great to create something from scratch

cos it was just a building site, an old building,

and as every brick was laid it was fantastic to imagine

what this luxury health club was going to look like.

It was just extremely exciting for me.

Ratner's business partner was Tony Colborne.

After failing to raise his share of the money to buy the club,

Gerald decided to employ Tony as general manager.

The bond between Tony and I is so strong because we went through

a situation that was totally hopeless for months.

It was just looking like the whole thing was sinking.

We were not getting the gym, we were not getting the money

and we stuck with it and we've come through it

and we look at it today, we can't believe it.

Gerald is unfortunately associated with an event which was a misfortune

and I think there's a lot of people, even after all these years,

who are looking for another misfortune,

and it's a big pressure on me to make sure that doesn't happen.

So really, my motivation is to make the business work.

We had a certain rapport,

a sense of humour maybe through the adversity,

but we joked around

and we got on extremely well.

Although they'd raised enough to start building, money was tight.

A short cut was made on a key aspect of the gym -

there would be no air conditioning.

Will the place smell of BO?

That's basically the question that we want answered.

Can you guarantee there'll be no smell of BO?

I can't guarantee. It is designed not to smell.

Nice and cool in here, isn't it?

That's a good sign. It's cool.

Gerald put £200,000 into the project

and found two outside partners to put in the same.

The price of the building contract was fixed,

but more money was needed to cope with the luxury equipment.

You're saying that to run 40 aerobic machines costs more than...

Originally you just had a free-standing cycle

that you used to pedal on, and now it's got computers and power

and you've got the running machines that run up and down...

It's absolute nonsense.

And to put up the cost by 120,000

when we're in the middle of doing it,

'it's a try-on and they're not going to get away with it.'

We had to put a facility that was going to be first-class.

The worry here was that costs now were escalating.

We didn't have it in the budget and we were having to cut corners

and we were going to be a laughing stock,

so that was another pressure we were under.

Determined to lure members to his new health club,

Ratner decided to build a pool.

It's very exciting that we're digging the hole now.

I couldn't believe that this has happened.

Fantastic.

Ratner's other partner was property developer Michael Sears.

He agreed to stump up the extra £100,000 needed for the pool.

I reckoned that Gerald Ratner was very keen to make a comeback

and to get involved, he needed something to do, he was screaming.

This guy needed to get involved in something

and get his hands on a task and get working again.

-Hi, Michael.

-Cor!

Dug ourselves a bloody big hole there!

I felt a bit under pressure because he is a tough nut

and he wouldn't accept anything other than perfection.

We want the creche to be in here or somewhere, I don't know where,

we want it to be in here.

Michael was worried about the creche.

The plan was to put the members' kids in a log cabin in the garden,

but Tony hadn't applied for planning permission.

-What about this corner here?

-That's our nice garden area.

We're seeing a cabin this afternoon, we'll look at the space

and how many children it can accommodate and if it's the type of building,

and if it is we'll give the dimensions to the architect

and tell him to insert it into the plan.

There's a meeting on Monday.

Your argument is one of the reasons you haven't put planning permission

in for the log cabin is you didn't know what log cabin we were buying

-or what size it was...

-No, we don't where it's going to go.

But Tony!

The whole thing about planning is you write down where you'll want it to go

and then you go in and ask for that and you make sure that that happens

and it's not going to descend from heaven.

You've got to decide what you want.

If you don't make those decisions, nothing happens.

-Is this it here?

-Yeah.

Under pressure from their investors, Gerald and Tony decided it was time

to secure a deal on the log cabin for the creche.

He's asking £6,000 for it, he's indicated...

I think we should offer him five.

Well, he's already indicated he'd accept five...

Offer him four, offer him four. In cash, this afternoon.

With Michael Sears it was always a little bit difficult.

You had to be very careful what you said, but with Tony

you could just make a fool of yourself and he could with me

and we didn't really care

and we...you know, just enjoyed our journey together.

-So what would you be prepared to pay?

-What's your figure?

-I'm asking you, what would you do?

-You say £1,500 to move it...

I say two. You've got to make it look worst-case, haven't you, to him?

No, I want the real facts from you.

We say two but we can probably get it done for between one,

one and a half.

Well, I reckon if we're all in for five for the whole lot that's fine.

What's the best deal? The best deal is to pay nothing, isn't it!

'Go up and say to him, "Me and my partner have had a long discussion

'"and we've formulated an offer for you and it's nothing!"'

I mean, you can do that, but I'll hide behind the hedge.

It's still going to cost us about £2,000.

He'll be very impressed with that offer, won't he?

He'll kiss your feet.

The owner arrived and an offer was made.

If we offered you £4,000 today plus we'd look after the removal cost

-we'd be prepared to give you a cheque today.

-I'll accept that.

-Good.

-OK.

-Thanks very much.

Gerald had his creche, but without planning consent,

it could only open for two hours a day.

His wife Moira predicted problems.

I assume that they'll pick a reasonable two hours,

-and the morning is always the best time.

-It'll be between 11am and 1pm.

I should think that's probably the worst time to have a creche open, Gerald,

over lunchtime. I would have thought 10 till 12.

-Who did make this decision?

-Tony.

-DAUGHTER:

-Did you agree with it? Did you?

-Erm, yeah.

-You see, Daddy, the things that Mummy asked you, who made this decision,

let's say Tony made it. You still agreed with it.

If you didn't agree, it wouldn't happen, I mean...

He's just trying to annoy me, Sarah.

I know, I know. I still think it's right.

Then go and say to Mummy,

say to Mummy,

"Tony said it but I agreed with it because I thought it was right."

-Don't go and say Tony thought of it.

-Tony said it and I agree with it.

Although we were joking around and everyone was very happy,

we were very short of money,

and I clearly needed to make a success of this

to get an income coming in.

GENERAL CHATTER

It's extremely tense.

Everybody is very edgy

and they won't let me in into the Portakabin when I smoke this cigar

so I'm sitting out here.

And I don't normally inhale my cigars, but I am this week.

With less than an hour to go,

the staff arrive to help with the preparations.

Ratner decided it was time to rally his troops.

I know it's been an enormous amount of pressure

and it's been absolutely ridiculous but it's not looking bad,

it's not 100% but it's not bad and I would just like to thank you.

I know we're all under tremendous strain

but if it's possible that we can all smile,

because that's the best thing we can do.

-You're the only one not smiling.

-I'm the only one not smiling!

I agree, I'm not, but if we all try to smile, because the most powerful

thing we've got is the people who are running this gym.

And I've got 100% confidence that it will be an enormous success.

After all the hard work,

it was time for the new members to give their verdict.

GUESTS CHATTER

This is very exciting time for me because I'm starting a new business

and I've never done that before.

I've ended a business, but I haven't actually started one.

Gerald and Tony decided not to put air conditioning

throughout the club.

They're saying, "When are you turning the air conditioning on?"

I said, "If we turn it on, the floors warp."

Have you done all that?

I've said that air conditioning dries your mouth. Didn't work.

-Cheers.

-Well done, Tony. You've been a good partner.

-Have I?

-You have.

'Congratulations. Here's to The Workshop.'

It was a wonderful evening for me, I loved it,

and what I said to Tony was true, he was a great partner.

Gerald had to go on a promised family holiday to Portugal,

leaving Tony in charge. He was becoming more and more worried

about whether Tony was up to the job.

-'Hello.'

-Gerald?

-'Hi, Tony.'

-How are you?

-'Fine, thanks.

'Do you know how many members we've got at the moment?'

-We're in the 600s somewhere.

-'Right. What, 601?'

I'm not exactly sure, because we don't have our systems

properly set up here yet.

-The pool they're filling with water tomorrow.

-'Oh, right. Good.'

All the tiling is completed now - that looks fantastic.

'Are you going to order the paving stones for around the pool?'

Yeah, we'll have to get that sorted out.

Gerald returned from holiday

to discover that the swimming pool still wasn't ready.

Tony hadn't ordered the paving stones and the filtration system.

It drove me mad on my holiday because I kept phoning up every day

asking about the pool house and I was told

that it was starting tomorrow every day,

and in fact one day I was actually told it had started,

and it hadn't started.

The creche was behind schedule

and only 13 more memberships had been sold.

Gerald and the other investors

decided that drastic action was needed.

It was actually the last straw when Gerald come back from holiday

and found that the swimming pool was not open.

The pool was absolutely finished, it even had water in it,

but it didn't work because a little pool house needed to be ordered

to enclose all the filtration.

For some reason which I will never understand,

that pool house was never ordered.

I had a phone call from Tony on Friday afternoon.

His actual words were, "I've got some terrible, terrible news."

Michael Sears looked at me and said the club is disaster

and that I'm responsible for it

and the best thing he thinks can be done is that I step down.

Which was quite bizarre, really,

because the club was successful.

I think it was a bit harsh on Tony.

As he said in that clip, it was a big success,

but he was very annoying not ordering...

Sorry to go on about this,

but why did he not order the paving stones

so we could build the pool house?

It was so annoying that I came back from holiday

and the pool was not operative.

Having said all of that, he didn't deserve to go.

Maybe it was a bit of a rash decision to tell him to go

and perhaps I should apologise.

But...

..that was it.

Ratner decided to take over as general manager.

When the pool was finally finished, he held his own launch party.

-Is there ketchup?

-There will be.

Not sure it's ready yet. Let me give you one of these.

-Gerald, you're burning the buns.

-I know, I haven't got any tongs.

-SARAH:

-I want my father to have a proper successful business.

I don't want him to worry about his gym,

I want him to have fun with it and also I want it to be successful

and have a nice time.

For Ratner, The Workshop had been a big success.

For his former business partner, it was a different story.

Tony Colborne took the owners to court, claiming unfair dismissal.

He lost the case.

In 2001, Ratner decided to sell his stake in The Workshop.

It was fantastic for me because I'd come from a situation

where I didn't have any money, I didn't have a job,

I was unemployable, and here I was,

I made a big success of the club,

sold for £3.9 million.

It meant everything to me, this club, it was a great stepping stone.

It got me back on my feet.

With the money he made from the health club,

Ratner has rebooted his career

by launching an online jewellers.

He's also keen to make a return to the fitness business.

To find out how the industry's changed,

he's going back to The Workshop.

It's now owned by one of the country's biggest health club chains.

Manager Kate begins by showing him the pool.

Well, obviously this is the huge difference. I can't believe it.

-It was outdoors, wasn't it?

-It was outdoors.

Obviously we spent a lot of money on heating, stuff like that.

We never covered it, but it does look fabulous, I have to say.

They've done a fantastic job.

This is like a really hard-working looking place, you know,

that you'd really go to a serious gym where you do serious workouts.

I think that's one of the biggest things now,

they used to be more leisure clubs and now they are gyms.

The Workshop may have changed,

but for Ratner, it's a reminder of how he re-launched his career.

We created a health club from nothing.

I'm very proud that people have come here over the years.

They wouldn't have done it if we hadn't had the idea

and started it from scratch.

But Ratner's success came at price -

the end of his partnership with Tony Colborne.

For him, rebuilding his career would mean looking for new horizons.

I often reflect on the period of being involved with The Workshop

and with Gerald and with others there

and it bothers me. It's bothered me constantly for years,

partly because I had a good relationship with Gerald.

I left The Workshop,

and it took me a little while to gather my thoughts,

because I'd put quite a lot of effort into that.

After being sacked by his former business partners,

Colborne began to search for new opportunities.

Soon after, I went back to the City where I'd previously been

and I established a software company

which was focusing on the Lloyds of London commercial insurance market,

and we worked hard at that

and over a number of years it became very, very successful.

Colborne decided to sell his company in 2006,

in a deal worth nearly £12 million.

It was a life-changing moment.

The sale of that business gave me a cushion

to enable me to develop in areas

that I wanted to be involved in.

Today, Colborne's business interests

include developing eight luxury properties in Morocco.

They're very large properties, maybe six to eight bedrooms

with staff accommodation.

I'm building these houses

for people that want to perhaps spend more time in Morocco.

In 2011,

Colborne finally decided it was time to heal his rift with Ratner.

I've sort of agonised over that for years,

particularly when things go wrong, it always reflects back

to that particular time,

and I just decided that my life's not all that bad

and I thought it was something I would aim to deal with.

I don't want to live with that anger and bitterness.

Today, Ratner and Tony Colborne are finally meeting

to discuss their acrimonious split.

It did make a big impression on me,

and the unfortunate way that it ended, and I don't, as you don't,

like to leave things in the air, the bitterness that obviously was there,

so it's nice it's been resolved by you contacting me.

As soon as you did that, I immediately was delighted.

Really, I should have got in touch with you,

you were the one that was hard done by, not me,

but what made you bury the hatchet, so to speak?

I felt I wanted to deal with it,

because I've been having too many bad thoughts about things

and we always had a good relationship and had a lot of fun.

We did, we really did.

But I was very unhappy about what happened at that time.

A lot of work went into building that club

and I was particularly pleased that it did complete.

It was a fantastic success, and a lot of it down to you.

You did a fantastic job in terms of initially buying the site,

marketing it, the advertising.

There were certain things that were frustrating,

that were taking a long time after it was open,

and when I came back from holiday, I was really upset.

I wanted to come back and see people swimming in the pool,

that's what I was always hoping.

But you were on holiday a week before it opened.

You said to me you should always leave the party with who you arrive,

-you remember that?

-Yeah, yeah!

-But when it came to it, you didn't do that.

-That is bad.

-I'm disappointed about that.

It's still in business,

people are still going there every day after 15 years,

and so therefore that's great.

Which you created, or we created.

Yeah, we'd done that and had a lot of good times.

No, I'd heard that you did well and it's been nice...

You know, cos immediately we've got this same rapport we had then,

which I missed in a way,

I don't want to get too cheesy about it, but we got on well.

We did, yeah.

And I hope we can keep in touch.

What plans have you got now? Got any plans to do anything new?

-Well, I'm thinking of going back into the health club business.

-Oh, really?

But this time not a luxury health club where you just lie around

by a swimming pool or go into the beauty area, sit in the bar,

but something much more functional, and I'm thinking of rock climbing.

He persuades Tony to visit their local climbing centre.

It's a chance to see how the business works

and to try out it for himself.

I am scared of heights,

but I suppose if I'm going to do this as a business,

I should try it at least once.

-How's that feeling?

-Well, I'm not looking down.

-OK, do you want to pause there a moment, Gerald?

-Yeah.

You're nice and tightly secured. Do you want to have a look at me?

No.

SHE LAUGHS

-Can I just step down a bit?

-Yeah, that's fine.

-Gerald, if you look down at me a minute.

-I'd rather just step down.

That's all right. Hold onto your knot.

That's it, now push your feet against the wall.

-Trust it. Lovely.

-I've got you now, yeah.

-Yeah? Got it? Happy?

-Yes, happier now.

Leave your feet where they are. Leave them there a moment.

Don't move them. Keep them there

until you get lower into a seated position.

-With you now.

-Lovely. Walk them down the wall.

-I see.

-You got it. Fantastic first climb. Well done.

Yeah. So I should have done that a bit earlier.

Yeah, don't worry, nice work.

-Great. Tony, do you want to try it?

-You're alive, you're alive!

-Yeah.

-Yeah? Well done.

I've done that, that's great, I'm not doing it again!

I didn't particularly enjoy it because it was terrifying,

but from a business point of view, I'm convinced even more so

that it's got to be incorporated into a health club.

Ratner may be enthused,

but his former business partner remains doubtful

about his climbing centre concept.

It's a very niche market, though, isn't it?

No, exercise...it's exercise... leisure - it's the biggest market,

everybody is into health and fitness.

Tony remains sceptical, but after healing his rift with Ratner,

he's at least lending him his support.

I think Gerald did very well.

I think with a bit more practice he'll be on top of the highest wall.

Ratner's even hopeful their reunion may be the first step

towards a future collaboration.

-Maybe I'll try it one day.

-Come along, give it a go.

And you'll say, "Gerald...

"You're right."

-"I wish I had invested at that time."

-"I wish I had invested at this time."

Or you might say, "I can still invest with you, Gerald."

It's not too late, because I still haven't found anywhere yet!

# I don't know how I'm gonna tell you

# I can't play with you no more

# I don't know how I'm gonna do what Mama told me

# My friend, the boy next door... #

Subtitles by Red Bee Media Ltd