Dusseldorf Wolfgang Grupp has been managing the textile manufacturer Trigema for 53 years. Karstadt was an important customer for him for many years. The department store chain is now part of Galeria Karstadt Kaufhof. And the company has been in insolvency proceedings under its own responsibility since October, the second time since 2020. Grupp takes a critical view of this, as does the role of the owner Signa and its founder René Benko.
“Mr. Benko put the land and the real estate company in one pocket and the operating company in the other. And he let the operating company go bankrupt twice, ”says the entrepreneur in an interview with the Handelsblatt.
At Trigema, as a registered businessman, Grupp is personally liable with his private assets. Addressing Benko, he asks: “Where is his responsibility towards the employees?” Around 17,000 employees work at Galeria Karstadt Kaufhof.
In addition, Grupp sees “the interests of the creditors not well represented”. In the first insolvency proceedings, the creditors waived around two billion euros when they approved the restructuring plan.
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At the time, the insolvency plan stated that “all branches” were rented from the department store group. However, Benko’s Signa Prime group owned 59 real estate locations of the Galeria Kaufhof group.
The entrepreneur is the owner of the Galeria Karstadt Kaufhof.
(Photo: Getty Images for Oberpollinger/ )
Galeria Karstadt Kaufhof received a total of 680 million in state aid from the Economic Stabilization Fund (WSF) in the course of the corona pandemic. Since no further state aid is to be expected, the chief representative Arndt Geiwitz, who is managing the renovation on behalf of Benko, said a few weeks ago: “The aim of all measures must be to create a viable structure under changed conditions.”
However, it is still unclear what “on its own” means for the department store company and its employees and to what extent the owner is involved. Inquiries from the Handelsblatt remained unanswered by Signa.
Wolfgang Grupp suggests a tax discount for liable entrepreneurs
Entrepreneur Grupp sees such behavior by Benko as “not compatible with my understanding of the law”. Entrepreneurs must also take financial responsibility for their decisions.
The Trigema founder therefore demands that entrepreneurs and possibly also managers should be liable for their operations. His idea: Liable entrepreneurs, like himself, should receive a 50 percent income tax discount, “then they would certainly act more responsibly,” he is convinced. Insurance would also be staggered: “Insurance with a deductible is also cheaper than one with comprehensive insurance,” says Grupp.
>> Read here: Galeria Karstadt Kaufhof spent more than 80 million euros on consulting services in the first insolvency proceedings
More than two decades ago, the entrepreneur himself saw the demise of the department store and mail-order company kings, to which Karstadt belonged at the time. Trigema has not supplied Karstadt for almost three decades.
Grupp still remembers well that when a representative from Karstadt came to the company headquarters in Burladingen, he “mentally rolled out the red carpet”. At that time, the department store group had orders worth millions to award.
The department store group has applied for a protective shield procedure for insolvency under self-administration.
(Photo: IMAGO/Jürgen Ritter)
But the relationship has changed: At first the Karstadt buyer ordered fewer, then he demanded lower prices, Grupp recalls. He refused, “for reasons of fairness to the other customers,” as he says. “I have to sense when the customer has problems, and I noticed that at Karstadt decades ago.”
Trigema then also supplied self-service markets and finally discounters. When these too had asked for prices that were too low, Grupp decided to set up his own test shops, as he calls the Trigema branches. 42 are today.
“It would be fatal if we were still a supplier to Galeria Karstadt Kaufhof today”
“In a needs-based economy in which the only arguments are about prices, as a producer I had to put part of the trading function into my own hands in order not to become totally dependent on the last major customer,” says Grupp.
His competitors at the time would have gladly taken Trigema’s place at Karstadt, at lower prices. But the competitors came under pressure over time and had to relocate production abroad. Many have filed for bankruptcy, says the entrepreneur, who has all T-shirts, polo shirts and jogging suits produced exclusively in this country.
For him it is clear: “It would be fatal if we were still a supplier to Galeria Karstadt Kaufhof today.”
More: Galeria Karstadt Kaufhof: Employees fear for their jobs