Before, nobody could see the point of Argos. Now it's our best of hope of stopping the Amazon juggernaut

News of Sainsbury’s bid for Home Retail group, owner of Argos and Homebase, caught the market unawares. More of a surprise was that Mike Coupe, the quiet Sainsbury’s chief executive, should have undergone such a dramatic conversion.

Four years ago, Sainsbury’s management were mulling going for Home Retail Group. Justin King, then chief, was not especially moved either way; Mr Coupe, his right-hand man, was vehemently opposed, saying the company should stick to what it did best, food.

What’s changed, in a nutshell, is Amazon. We may suppose that the giant supermarket groups spend their time fretting over the next move in their never-ending scrap with each other, or that they worry about the gains made by the German interlopers, Aldi and Lidl. They do, but more panic-inducing for them is the thought of Amazon entering their territory.

Soon after he took over at Tesco, I had dinner with Phil Clarke. There he was, kingpin of a company that dominated British groceries – that appeared to be unassailable.

We talked about the changing habits of shoppers – how increasingly they used the superstore and online for their staples, and liked to visit the convenience store on their way home from work. Tesco, with its smaller branches as well as the out-of-town behemoths and a smart website, was well placed to deal with that.

We discussed the discounters, and how they were making inroads. But that was all – they would never reach the size of the “big four” operators Tesco, Sainsbury’s, Asda and Morrisons.

No, what detained him above all else was Amazon. The US online titan was trialling fresh produce deliveries in its home patch of Seattle. It already sold non-perishables. It was only a question of when, not if, it decided to take the plunge and go for groceries. Having seen the havoc wreaked by Amazon elsewhere on the high street, Mr Clarke was petrified.

Over at Sainsbury’s, the fear was the same. It isn’t the Argos outlets that have lit Mr Coupe’s fire and forced the U-turn, or the thought of Sainsbury’s owning Homebase again. It is Argos’s distribution system that Sainsbury’s wants. Weird as it may seem, Argos, possessor of dismal stores and a catalogue that feels decades old, is an industry leader when it comes to online purchasing and delivery. Order from Argos and the goods can be at your door in just four hours.

Only one other supplier matches it but that rival’s service is more costly. Its name? Amazon.

In November, Amazon launched Pantry, delivering groceries in the UK. In November, Sainsbury’s made its approach for Home Retail.

The daunting challenge of dressing M&S When Marc Bolland ran Morrisons, I met him at the group’s Wimbledon branch. He was master of all he surveyed, clearly at home among the aisles and shelves, excitedly showing off the chain’s new, specialist meat, fish and bread counters.

It was clear that Mr Bolland, the ex-chief operating officer of Heineken, understood grocery supply systems and logistics backwards. We talked about where he might go next, and he played down the idea that he might be about to move, possibly to Marks & Spencer.

Weeks later and he was unveiled as the new head of M&S. I thought then that he would be fine with its renowned food division. And so it proved: under Mr Bolland, M&S continues to outperform the grocery sector.

But clothes, and in particular, womenswear? I couldn’t get how Mr Bolland knew anything about that industry. He was dapper enough, always snappily turned out. Would he, though, be able to succeed where Stuart Rose, his predecessor and a rag trade veteran, had struggled?

He made some smart moves. One, especially, had his competitors purring in admiration. That was the hiring of the Lindsey brothers, Mark and Neal. Outside clothing they were little-known, but inside they were the back-room duo credited with transforming Next’s supply chain and making it the super-efficient, margin-driven business it is today. They were based in Asia and were brilliant at sourcing fabrics and overseeing manufacturing in that part of the world.

Improving stock levels and pushing up margins, however, were not enough. M&S also needed to sell clothes that people wanted. Mr Bolland made a good fist of it, recruiting supermodels for the advertising, and asking Belinda Earl, ex of Debenhams and Jaeger, to revamp the ranges. But he did not achieve the desired transformation: where M&S food sales soared, clothing brought it down.

Will his successor, Steve Rowe, triumph where he did not? Certainly, he is more immersed in the M&S culture than Mr Bolland was when he took charge. Mr Rowe’s father, Joe, was an M&S director, and over 26 years Steve worked his way up through the organisation. But the high street is littered with names that were simply not there when M&S was in its pomp. It has also got myriad new internet and catalogue suppliers to contend with. Mr Bolland did a good job; somehow Mr Rowe has to do better.

I spent part of this week with Paul McKenna, the TV hypnotist and self-help author. His 17th book, Instant Influence and Charisma, is published this month. While his stage act is well-known, and his books on how to get thin, how to become rich, how to quit smoking and how to be happy sell in their millions (10 million to date, and counting), he has developed a more private sideline in advising corporates on how to get the best out of their sales teams.

He is in constant demand, apparently, paid by companies to address their away days and conferences or to go into their offices and rev up the sales force.

He claims to produce excellent results. Which made me think of all those MBA courses, organograms and elaborate, over-rehearsed PowerPoint presentations.

What they don’t tell you at Harvard Business School is that it’s all in the mind.