The Budget was not good for business or retail, warns Dune founder Daniel Rubin
Black Friday may have delivered a short-term boost and the Chancellor may have tried to offer retailers an early Christmas present by pledging business rates relief in her Budget last week.But for many British businesses heading into the crucial holiday trading period, the reality is far from festive.After years of relentless crises - the financial crash, the rise of online shopping, the Covid-19 pandemic, inflation, rising wages, energy price shocks and the decline of department stores that once anchored town centres, UK high streets are in a fragile state.Few are better placed to navigate this brutal reality than Daniel Rubin, the founder of shoe brand Dune, who has been on the front line of British retail for five decades.'It's just been one event after another for the past 10 years. It's made trading really challenging,' he says, adding that changes to retailer taxes announced by the Chancellor on Wednesday are unlikely to help matters.'This was not a good Budget for business or retail and it will certainly not drive growth, which the country urgently needs,' he says. 'It's just been one event after another for the past 10 years' Daniel Rubin, the founder and boss of Dune saysWhile Rubin acknowledges that most of the spending measures had been 'hinted at well in advance', the late timing of the Budget, pushing up against the key Christmas trading period, as well as constant leaks of potential policies that were later reversed, had caused even more damage.'A lot of purchasing and investment decisions were unnecessarily delayed. The whole process was badly handled,' he says.As for the reduction in business rates on 750,000 properties, he sees this as mere 'tinkering' and insists the system needs a complete overhaul. Daniel Rubin biography Age: 78Family: Married to Anne, two children; Edward, a TV producer and Olivia, fashion designer (Olivia Rubin)Lives: Mayfair, LondonBreakfast: Two pieces of toast, one with manuka honey and one with smooth peanut butter and Assam tea with loose tea leavesLast book read: I Regret Almost Everything, a memoir by Keith McNallyShoes owned: More than 100 pairsShoe of choice: Loafer 'The retail sector pays 75 per cent of business rates and occupies about 25 per cent of the properties, so they're penalised to a huge extent. No other country has a system like this,' he tells me.'I go to France a lot and they've managed to keep their high streets and independent businesses. Here, occupation costs are so high that it makes it very difficult for traders to make any money.'He also believes constant uncertainty around what ministers will do next is driving away investment.'On one hand the Government is saying growth, but everything they're doing is having the opposite effect,' he says.'Businesses aren't investing because of uncertainty and increasing costs. There's no incentive to open on a high street full of charity shops and nail bars. Why would you?'Despite this, he believes the Budget's conclusion may at least remove one layer of uncertainty for shoppers.'Now that it's out of the way it will help sales as many consumers were waiting for the budget.'So far, the signs are positive. 'Christmas trading has been okay. This week has been strong,' he says.Economic uncertainty is nothing new for a high street veteran like Rubin, 78, who knows more than most about what it means to bounce back from hard times.Born into a line of shoemakers and cobblers from Eastern Europe, Rubin was steered away from the trade by his father, who urged him to become an accountant instead.'It was a struggle because I was useless at maths, but I did qualify,' he recalls.After spells at accounting firms Touche Ross and London & Continental Bankers, he returned to help his father in the shoe business when his health declined.When his father died in 1977, he stayed in the trade, first in manufacturing, then importing.'I got to love the product; the smell of the shoes, the complexity, the manufacturing process.'He now owns more than 100 pairs of shoes – although not all Dune - and has a soft spot for a well-made loafer.In 1986 Rubin set up Browning Enterprises, which helped bankroll Dune, founded in 1992 as a small concession on London's Oxford Street.It was also where he learned how testing the industry could be.To fund his first shipments, he took out a second mortgage, 'putting my family and home at risk', only for his first major consignment to arrive faulty. Ten thousand pairs had to be thrown away.'It was a real wake-up call,' Rubin says.A later scare came when a large order for one of his customers, fellow shoe brand Faith, arrived damaged.'[Jonathan Faith, the company's boss] rang me and said: 'I've got a big problem'… Luckily, they sold but it struck home just how important quality was.'But nothing tested him like the Covid-19 pandemic, which left Dune and other high street stores shut down for months. The company lost around £25 million in two years, leaving it in dire straits.'That was the time I got closest to thinking, 'Are we going to get through this?' Rubin says.In 2021, the company underwent a major restructuring but ultimately managed to return to profit the following year.Despite the heavy battering the sector has taken over the years, Rubin rejects the idea that all high streets are doomed.'The proof of that is that rents are going up, which means there's still demand,' he says. 'For some it's working okay, for others not.'He adds that many casualties are often predictable.Brands like Topshop, Dorothy Perkins and Warehouse, he argues, couldn't compete against faster rivals like Zara and H&M. Others lost their edge when private equity entered and they 'lost the essence of what that brand was about', something he has tried to avoid. The Rubin family own 85 per cent of the business.Rubin reflects on his career in his memoir Sole Survivor, published by Canbury Press.In his view, survival comes down to the product. 'You have to get the product, the value proposition and positioning completely right.' Not enough: Rubin views the reduction in business rates on 750,000 properties as mere 'tinkering'Today, Dune turns over more than £140million a year and is going through major changes as it tries to transform itself from a UK-focused retailer to a global brand. Around 35% of its sales are now from outside the UK, with a target to increase this to 55% over the next three years.But Rubin says his ethos remains the same despite the evolution of the business.'We're not trying to do cheap shoes. We're doing affordable luxury. That's always been our mantra and still is.'That thinking has driven Dune into bags and accessories, which he sees as more sustainable long-term. 'If we can establish ourselves like a Coach or a Michael Kors, that's an exciting opportunity.'But while the company is in a much better shape than it was during the pandemic, it's not all plain sailing.Dune employs around 1,500 people and operates roughly 50 stores, including 20 outlets. Its outlets and some locations are performing well, but other sites are under pressure. Six full-price stores have already closed, with four or five in smaller towns likely to follow.Before the pandemic, Rubin received two very attractive offers to sell, which in hindsight he now believes he should have taken.'I should have accepted,' he says. 'They were life-changing but that ship has sailed.'He has since stepped back from day-to-day operations, but he remains closely involved, describing himself as the 'guardian of the brand'.'I'm still going. I'm excited about the future,' he says. 'I see us growing over the next two to three years and the value will increase.But he does not rule out a sale if another bid emerges in the future.'Of course, if a fantastic offer came along, I'd consider it.'But for now, Rubin remains where he's stood for half a century - on Britain's high street.DIY INVESTING PLATFORMSAJ BellAJ BellEasy investing and ready-made portfoliosHargreaves LansdownHargreaves LansdownFree fund dealing and investment ideasinteractive investorinteractive investorFlat-fee investing from £4.99 per monthFreetradeFreetradeInvesting Isa now free on basic planTrading 212Trading 212Free share dealing and no account feeAffiliate links: If you take out a product This is Money may earn a commission. These deals are chosen by our editorial team, as we think they are worth highlighting. This does not affect our editorial independence.Compare the best investing account for you
