The end of Germany’s Neckermann mail order firm (Excerpt)
By Marianne Arens
World Socialist Web Site, October 10, 2012
At the end of last month, the Neckermann mail order company permanently closed the doors of its headquarters on the famous Hanauer Landstrasse commercial stretch in Frankfurt. Apart from a small online business, the firm's subsidiaries in the German state of Saxony-Anhalt, as well as in Belgium, the Netherlands, Austria, and Switzerland, will be closed down. Some 4,000 workers throughout Europe were employed by Neckermann, including about 2,400 in Germany. ...
Last week, when workers were confronted with imminent closure, works council head Thomas Schmidt falteringly told the press it was "the hardest and most brutal thing" he had ever experienced. He said Sun Capital, the current owner of Neckermann, had not budged from its position. "German corporate culture always provides for the possibility of compromise; but not so in this case", complained Schmidt (Frankfurter Rundschau, September 28, 2012).
"Rarely before" had "an employer so obstinately refused financial help in the form of severance pay to employees facing such catastrophe", complained Verdi secretary Wolfgang Thurner—who also sits on the Neckermann supervisory board—in a commentary for the German Financial Times (September 30, 2012). Sun Capital had "simply spurned common sense, the search for a socially acceptable compromise between the parties involved....", he wrote.
Union officials’ claims that a "socially acceptable compromise" was possible only served to disorient the workers. .. The history of Neckermann reveals that the so-called “socially acceptable compromises” of "German corporate culture" was never more than a propaganda phrase, repeated by trade unions to justify their subordination to the interests of capital.
When Josef Neckermann established his mail order business in 1948, the year of German currency reform, he was able to continue operating the firms he had acquired through the "Aryanisation" of Jewish stores during the Third Reich. In 1935, Neckermann had taken over the Mercur emporium and a textile department store in Würzburg from Siegmund Ruschkewitz. Other similarly "Aryanised" businesses were later added to the list: the Vetter department store in Würzburg and most importantly the Karl Joel clothing business in Nuremberg and Berlin. Due to the Nuremberg racial laws, the Jewish owners had been forced to "sell" their companies well below their real value.
As a member of the Nazi Party, the SS (Hitler's elite force), and the SA (Hitler's paramilitary army), Neckermann procured orders from the Nazi state's economic and war ministries, thus profiting from the war and the Third Reich's regime of terror. Neckermann delivered blankets and work clothes for forced labourers and winter uniforms for the Wehrmacht. Despite all this, he was only classified as a "fellow traveller" of the Nazi regime during the "de-Nazification process".
In the 1950s and 1960s, the slogan "Neckermann makes it possible" became a by-word for the German economic miracle. Along with the Otto and Quelle mail order firms, the Neckermann mail order business delivered everything from clothes, linen, and crockery, to radios, refrigerators, and TV sets, to holiday travel packages, insurance policies, and prefabricated housing. ...
During the postwar period's first major economic crisis in 1976, Neckermann was forced to sell its mail order business to the Karstadt department store chain (later to become KarstadtQuelle/Arcandor). Josef Neckermann retired to devote himself entirely to horse riding, while his two sons emigrated to the United States. Under the Karstadt ownership, the Neckermann company lost its department stores and became a purely mail order business. In the late 1990s, it launched into Internet trading, which accounted for 80 percent of its sales in 2012. However, Neckermann was never able to catch up on the lead already taken by Amazon and other Internet specialists.
In 2004, Thomas Middelhoff assumed chairmanship of Neckermann's parent company, KarstadtQuelle. He had previously been CEO at the Bertelsmann media corporation and a member of the AOL and RTL Group supervisory board. Middelhoff is the embodiment of the entrepreneur as financial speculator—i.e., he lost all interest in the productive and trading side of the business, and devoted himself exclusively to the pursuit of short-term profit.
Together with Roland Berger and Florian Lahnstein, the son of former Social Democratic Party (SDP) minister Manfred Lahnstein, Middelhoff today heads BLM Partners, a London private equity firm. BLM's board also includes Manfred Lahnstein and Wolfgang Clement, another former SPD politician.
As head of Arcandor in 2007/2008, Middelhoff sealed Neckermann's fate by literally making a present of the mail order business to the US financial investor Sun Capital. As much as 51 percent of Neckermann went to the private Florida equity company for the symbolic price of one euro. The only hope of recompense rested on a successful future stock market flotation that was supposed to compensate Arcandor. "Within 12 to 18 months, Neckermann will be earning money", Arcandor mail order boss Marc Sommer is said to have promised at the time (Süddeutsche Zeitung, December 12, 2007).
Sun Capital, the new majority owner, is a classic "predator" outfit, specialising in the acquisition of distressed companies, plundering their assets and demanding exorbitant fees for doing so. The employees bear the full cost of the demolition.
Sun Capital is owned by the multimillionaire and stock market speculator Marc Leder. At his Florida villa in Boca Raton in May this year, Leder organised the gala dinner where Mitt Romney, the presidential candidate for the Republican Party, expressed his contemptuous remarks about the bottom 47 percent of US citizens (see "Romney's words", WSWS, September 19, 2012). ...
While banks and investment firms such as Sun Capital are making record profits, working people are paying for them with their livelihoods, their jobs and wages. The end of Neckermann has once again shown that the Verdi trade union is firmly on the side of the corporations and banks in what it describes as a "class war waged from above".
"Josef Neckermann," Wikipedia