23 Sep 2011
At just 38 years, Bompard is a young man in a hurry. It took him only one weekend to reach a decision when François-Henri Pinault, the head at Fnac’s parent company PPR, offered him the reins at Fnac with the added incentive to join him on the group’s executive committee. The appointment marked what the company referred to as “a new phase in this highly competitive market.” The hiring was also aimed at strengthening its position in France and abroad “as a leader of the digital revolution”, according to its CEO.
The business philosopher
Bompard grew up around Megève and had to grasp the business world at an early age as the son of the President of AS Saint-Etienne football club. He recalls his relationship with his parents fondly, saying: “My parents were always at my side, yet allowed me to have my own freedom. They gave me powerful values and I have never discarded those. I saw them work seven days a week. It was much later I discovered that work could stop on weekends.”
“I myself am my own engine,” says Bompard, who adores the genius of film director Claude Sautet, the beauty of the Italian Renaissance, and the simplicity of tennis and football. It is said that his passions are his obsessions, and his biggest one is resistance.
“Resistance is the moral refusal of unworthiness, yet it is also the sequence of intuitions and gatherings that allows us to turn small into big history,” Bompard muses.
Bompard is a graduate of the Institut d’Études Politiques, Paris, and holds a masters degree in public law and a postgraduate degree in economics. After graduating from l’École Nationale d’Administration he joined the Inspection Générale des Finances. There he served as finance inspector and technical advisor to François Fillon, then Minister of Social Affairs, Labour and Solidarity in 2003 and became a member of his cabinet shortly after. In 2004 he joined Canal+ and a year later he became Director of Sports and Public Affairs until 2008 when he left the television channel to work for broadcaster Europe 1.
A ruthless streak
There was astonishment and disbelief in the corridors of the French radio station when he left Europe 1 at the end of November last year. He had occupied the position of President and General Director since June 2008. It was by email that employees at the broadcaster had to learn about the departure of their boss. Nobody expected to see him go so soon and in such a manner after he so persuasively declared at the outset that he was very attached to the Europe 1 brand. He had become the company’s saviour and the main architect of its recovery, bringing levels of listeners it had never reached. But what was a loss to one company, was a gain to another.
After six months at the helm of Fnac, the charming, affable and smooth-talking Bompard unveiled a new five-year strategic plan for the company. When he took over at the French cultural and electronic product chain his mind was composing changes that could be implemented to promote growth at Fnac. The tactical scheme was announced at the end of July in an effort to help raise deteriorating sales as consumer habits alter and competition from the internet erodes traditional markets. “This is not just a cost reduction but an ambitious plan of conquest which will require investment. My hope is to produce its first results at the end of 2012, accelerate it from 2013 and from that point onwards see a tangible and sustainable growth of our sales business,” Bompard notes.
Dubbed “Fnac 2015” by Bompard and his team, the arrangement includes the opening of 30 new stores in France, mainly in the suburbs, and in countries where it already has presence. At the moment, the group operates 152 outlets, of which 82 are in France and 70 are based in Belgium, Brazil, Italy, Portugal, Spain and Switzerland. Bompard said that Fnac will also create an association of around 50 small local shops in medium-sized towns which it will run itself initially and then put out to franchise.
As part of the changes, Fnac plans to re-model merchandise, expand product range, overhaul shop displays, and open a ‘universe enfant’ in each store for children of up to 12 years with entertainment, technology and cultural products. Additionally, it will bring internet operations into stores, and will attempt to improve customer services, such as help lines and installation of equipment.
Tough times ahead
PPR, which also owns Redcats, Gucci and Puma, most recently exceeded analysts’ expectations when it published its first half year results. Net income excluding items of luxury and distribution climbed 24.4 percent to €466m. Operating income increased 14.5 percent to €749m, while gross margin was 10.4 percent, an improvement of 0.7 points. Income soared 7.3 percent to €7.2bn, a figure in line with analysts’ expectations, mainly due to luxury goods sales in China.
In contrast however, the distribution centre saw its sales fall by 1.4 percent, hit by Fnac’s poor performance which was down 3.3 percent and had been facing an extremely difficult environment in France. Fnac’s recurring operating profit was catastrophic, collapsing to €1m from €38m year-on-year. It is understood that PPR intends to sell the chain, but the rumour mill is silent for the time being on prospective buyers. It remains to be seen if Fnac’s new golden boy will succeed in becoming the saviour of yet another company by turning it all around.