“When I started the company, Britain was a fantastic environment for entrepreneurialism: a land of opportunity,” he says. “I was always the first to say this was a great country to business. But now that’s just not true.”
Harjani currently has 13 outlets worldwide: from London to New York, Mumbai to Madrid, Cape Town to Dubai. But now the UK arm of the business is proving uneconomical for the firm.
“The rents and overheads in the UK do not justify sales,” he says. “A good location in UK costs around £100,000 for 100 sq metres, and an additional £125,000 for rates, salaries and other expenses.
“Sales at a typical Aftershock store on a UK high street work out at between £10,000 and £12,000 per week,” he continues. “By the time you pay your VAT and other taxes, you’re left with very little. In Dubai, the same store would cost you half the operating expenses with the same sales.”
Harjani reckons that the situation is only going to worsen. His advice to other fashion retailers: jump ship now before it’s too late.
”The UK is dead for small niche chains,” he says. “It’s a big players field, now. Landlords are out of sync with small business, the government has imposed too many taxes: it’s killed entrepreneurial business and spirit. There will soon be a mass exodus.
“The best way to survive is to look abroad and export or even move,” he adds. “Developing countries are the future. In ten years time, Britain will be the poor cousin.”
Harjani practices what he preaches: Aftershock is currently in the midst of a massive international push.
“We are opening 25 stores all over India,” he says. “And we have 30 stores in the Middle East already. It’s a large export thrust.”
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