What You See Is What You Get: My Autobiography (32 page)

'Is that right? Is that right, Alan? I didn't realise that. Maybe I'm getting a bit confused.'

'Yes, you are getting a bit confused. But carry on, carry on, Gulu - I'm enjoying hearing my life story,' at which the family and friends started to laugh.

I told him, 'If you could speak English properly, or write English properly, I'd let you be my biographer.'

'Oh, you're so funny, Alan, a very funny man. Yes, not only a good businessman, but a very, very funny man.'

So Gulu had become my PR consultant and still to this day tells the same old stories. It's funny how if you convince yourself enough about something, then as far as you're concerned it's a fact. He still swears blind that Ann used to be in the van with me. Total nonsense.

On the way back from Hawaii there was a problem with the scheduling of the Pan Am plane we were going to connect with to get back to London, so we had the extra bonus of staying one night in San Francisco before flying home the next day. Earlier in the holiday, I had broken away from Ann and the kids and flown from LA to San Francisco to visit the head office of Dolby Laboratories. I needed to obtain a Dolby licence and get our latest cassette deck approved. After making the new range of aluminium-fronted amplifiers,
we had decided to design our own front-loading cassette deck and stopped buying from Orion. With help from Harry Imai, we sourced the cassette mechanism from Tanashin. The circuit to drive it was designed by my own people, while Bob Watkins designed all the mechanical stuff.

I spent a whole day in Dolby Laboratories with a test engineer, checking the unit out. Sadly, it failed. I urgently telexed Mike Forsey with the reasons. We submitted a new sample and finally got approval. We had become a Dolby licensee. This might not sound much now, but in those days it was a big deal. Dolby licences were only granted to large companies, so we had joined the big boys.

The car stereo market was doing very well for us and, as a quick learner, I soon found that Orion were not the be-all and end-all in this area; in fact, there were others who made better stuff. So, as well as moving my cassette business away from Orion, I also looked elsewhere when it came to sourcing car stereos. Otake's main henchman, Itakura, who had been present at our past meetings, was fully familiar with the Amstrad/Orion history. This bloke was always very serious and had the sternest face I have ever seen - in another life he could have been the commandant of a Japanese prisoner-of-war camp. Despite severing our relationship with Orion, he always kept in touch.

My new car stereo supplier was a company called Unisef, an arch-competitor of Orion. I used to love winding up Otake by telling Itakura that his car stereo prices were now off the radar and not only were Unisef cheaper, but they had a far better range. Otake's attitude was one of disdain, as if he didn't care. But his henchmen used to ask me privately afterwards how many we were buying. This, I knew, was under instruction from the Emperor, so I embellished the quantities to wind him up a bit more.

*

Wally for Wireless was a shop in Mile End Road, originally founded by Wally Segal, but now run by his son Harold. I had formed a friendship with Harold, who was a very nice fellow. He was the sort of retailer who was behind the counter every day; he touched and felt the products and knew where the market was going. Feedback from Harold was priceless. The quantities of goods he would order were much smaller than I would normally accept, but I made an exception in his case and supplied him. This turned out to be a good move. Of course, I could have consulted the buyers from the larger companies who
in theory
should have known what was going on, but the real insights came from Harold, who was there on the shop floor. From him,
I'd get the inside track on the way the market was moving, much quicker than I ever would from the giant companies. Harold was later to accompany me on a trip to Japan to source new ideas.

Harold's cousins ran a company called Stella Electronics, located in the Southend area. The company made car battery chargers which they sold to Halfords and the motor trade in general. Harold introduced me to these two cousins who, coincidentally, also lived in Chigwell. Funny how you can live in the same village as someone and never bump into them. Stella Electronics were interested in doing some sub-contract work for me and I started using them to assemble our cassette deck PCBs and a few other bits and pieces. During the course of this relationship, it emerged that they were well connected in the car accessory trade. They expressed an interest in my car stereos, but wanted them under their own brand name.

It is interesting to look back on how flexible I was at the time. Although I was intent on promoting the Amstrad brand, my mind was open to supplying these guys with their own branded car stereos to sell through their own channels of distribution. The way I saw it, it was extra volume and margin to a new market I had no connections with.

The problem with being a middleman between Stella and Unisef was not disclosing my supplier to Stella and not disclosing my customer to Unisef. I asked Ronnie Colson to handle the shipping. To do this, Waco formed a trading name - Amstrad Japan. This arrangement gave credibility to the notion that Stella was importing from Amstrad and it kept my supplier and customer isolated from each other. This was easy business I put on Ronnie's plate. I gave him 5 per cent for doing nothing really, just receiving payment from Stella and paying Unisef. It was money for old rope and it showed me that Waco would do anything when it came to trading.

The exercise also gave me first-hand experience of OEM trading. OEM stands for original equipment manufacturer. These manufacturers have no trading brand and don't sell to retailers but rather to others who
do
have their own brands. It showed me how one could make a margin on products without even touching or seeing the goods and OEM turned into quite a lucrative business.

*

By the late seventies, Japan wasn't the only country on my radar when it came to the latest technology. Hong Kong had just started to make transistor radios and small tape recorders as the technology migrated from Japan - the margins in low-cost stuff were no longer of interest to the Japanese; their culture was
always one of moving on to the next technology. But what I was starting to see - and would witness over the course of the next twenty-five years - was the emergence of South Korea and the explosion of the electronics industry in Taiwan, culminating in the world domination of manufacturing in mainland China. I would also witness the more flexible and versatile nature of the Chinese compared to the very cautious and formal nature of the Japanese.

In February 1978,I ventured to South Korea for the first time. Downtown Seoul - what a dead-and-alive hole that place was. When I returned home, I told people that if the world had haemorrhoids,
that's
where they'd stick the suppositories.

I was warned by Waco Trading that a military-imposed curfew existed in South Korea and all Korean subjects had to be off the streets by ten o'clock at night. Foreigners
were
allowed on the streets after ten, but the problem was that there were no taxis, no cars, nothing. So if you were out somewhere at nine o'clock, there was a mad rush for a taxi to take you to the Chosun Hotel, the only Westernised hotel in the city.

While in South Korea, I visited a firm by the name of Lucky GoldStar, a large electrical company which mainly supplied the domestic market. I was hosted by a young South African man by the name of Gary Meyer who worked in Waco's Seoul office. Lucky GoldStar, known today as LG, grew over the next thirty years into the massive giant it is now. I was there to discuss the possibility of buying twelve-inch black-and-white TVs. The importation of TVs was restricted by European government quotas in order to protect giants such as Philips, Thomson, Telefunken and Ferguson. An import licence was required, and I had obtained one to import 3,000 black-and-white TVs.

I negotiated the deal with Lucky GoldStar on this one-day visit. When I got back to the hotel, I rang Gerry Mason in England. I wasn't an important supplier to Comet back then, but he was intrigued when he heard I was calling long-distance from Korea.

I told him I had 3,000 black-and-white TV sets. His reaction was, 'You need a licence for those, sunshine.'

'I've got that, Gerry.' He went quiet for a while.

'You got a licence? How did you get a licence?'

'Well, Gerry, I have, so just take that as fact. I'm calling to see whether you want to buy them.'

After a bit of negotiating, he took the whole lot. He wanted them exclusively. It was a done deal as far as I was concerned, but the word 'exclusive' lodged in my mind. It's a word I would come to hear many times. Exclusivity
was something that every retailer would ask for and it was something I would struggle with in years to come, needing to juggle orders to maximise volume. I mastered the art of juggling as the years went on.

Leaving Korea was like being let out of prison - I felt I was going to be shot any moment. Most people were dressed in uniform-like black jackets done up to the neck and they looked at me and my Western clothes as if I were some kind of alien. They had seen foreigners before, but perhaps not so many of my age.

Outside the Chosun Hotel, I waved down a taxi to take me to the airport. A smartly dressed Korean businessman in his forties was standing next to me and asked if he could share the taxi to the airport. We exchanged business small talk and when we arrived at Seoul Kimpo Airport, he wished me farewell and plonked a copy of
Playboy
magazine in my hand. I couldn't quite understand why. 'Read it on the plane,' he said.

I flew to Osaka in Japan, the nearest airport to Otake's offices. When I arrived in the customs hall, a customs officer grabbed the
Playboy
magazine and asked me, 'What is this?'

I shrugged my shoulders, 'It's a magazine.'

Within minutes, four or five officials had gathered round. 'What's the problem?' I asked.

The officer opened the magazine and showed me the pictures of nude women, telling me, 'This is not allowed in Japan.'

That bastard at Kimpo Airport knew what he was doing. Instead of chucking this forbidden magazine away, he dumped it on me. They took me to some special room where they studied my passport and wrote down my details.

Thankfully, one of them spoke English. I explained what had happened. 'I am in the electrical business and someone gave me this magazine at the airport. I am not an importer of men's magazines.' The officer sort of smiled and told me that they would have to confiscate the magazine. I didn't object - I was just happy to be free from this interrogation.

After a day or so in Osaka listening to the thoughts of Emperor Otake, I visited Taipei - the first time I'd been to Taiwan. There I met with a Mr Chi Chi Liu from a company called VQC Corporation. He was a very short Chinese gentleman with a jet-black moustache and hair and he spoke good English, albeit in a very squeaky manner. VQC were specialists in components and became a major supplier to Amstrad at the time. The component industry had now started to migrate away from Japan, particularly on low-tech items such as switches, resistors and capacitors.

The UK market was moving towards car hi-fi. In-car graphic equalisers and massive bass speakers were becoming quite popular. You would stick the two speakers on the back shelf of the car, mount the graphic equaliser under the dashboard and connect it to the car radio, and the effect was twenty-five watts or so of music power blasting out. Many Taiwanese factories made this stuff and I was interested in buying it. We spent a couple of days visiting factories and I placed orders for some of this kit to enhance my now large range of in-car entertainment.

Like Harold Segal at Wally for Wireless, Colin Lewin, one of my old mates, had transformed his business to in-car entertainment, concentrating on selling high-ticket items made by Blaupunkt, Grundig, Pioneer, Bosch and Sony. He had his ear to the ground and I used him as my own personal product manager.

Colin wanted to stick to the big leading brands, but as his roots were that of a trader, he couldn't resist dabbling in the low-end market. He stocked Amstrad in-car entertainment as what he called his budget range and he gave me some great advice as to what kinds of specifications were required. I had learned another lesson: never forget your old colleagues from the early days, as they may come in handy later on.

My product range had become quite diverse: hi-fi equipment, cassette decks, black-and-white TVs and in-car entertainment. In fact, it was so diverse that it was becoming difficult to formulate an advertising strategy. Up to that point, individual products had taken the hero positions on full-page adverts.

One day, Gerry Eriera asked me whether I had a job for a young man, Malcolm Miller, who had trained at Birds Eye in the marketing department and was now looking to move to a smaller, more dynamic company.

Marketing
- another word for advertising? Some would argue not. I argue that most of our marketing budget went on advertising, with things such as exhibitions included. We were unsophisticated in those days and didn't recognise the power of PR that we'd come to know in later life (though even now I'm not convinced it's
that
powerful).

Malcolm seemed a quite clean-cut fellow with a nice way about him and he put across what he thought he could bring to this dynamic company. I'm not so sure he knew too much about the products technically, but he'd done his homework and certainly understood what we were selling and who we were selling to. Malcolm came at a good time. I needed to employ someone who could deal with the donkey work of the advertising we were doing. I wanted to be involved with the ideas and direction in general and
leave it to someone else to handle the photographers and generate the final artwork.