How you can go to pot and make it pay: Charles Fry

CHARLES FRY, the man who made pounds 10m by selling Johnson Fry, the financial services company, to the LIT group, only to lose pounds 6.5m when LIT collapsed, has had a roller-coaster ride rivalling that of Gerald Ratner, the former jewellery king. And when Fry talks about one of his other investments, a giftware importer called Mondian, he comes close to emulating Ratner's celebrated 'crap' gaffe. One of Mondian's ranges of plant pots and photo frames, he says, is 'awful, but okay for Granny on Mother's Day'.

Fry, still a director of Johnson Fry and a grandson of C B Fry, the former England cricket captain, is not noted for his modesty. Asked why no one seems to have copied Mondian's formula, he says: 'Ninety per cent of people are useless at their jobs.'

He has a buffoonish sense of humour. On the subject of his unusual Business Expansion Schemes, which have directed investment into wine and property instead of the worthier small businesses the Treasury had in mind when it launched the BES, he plays the innocent. 'Me? Subversion? How am I supposed to know what the Chancellor's intentions were?'

Fry's expertise lies in what is known as tax planning - last week Johnson Fry launched a new capital gains tax scheme. But he is also an investor who is prepared to back hunches in a big way. Six years ago he met David Aspin, then deputy managing director of Cloverleaf, a giftware firm.

'David is very charming, a very good salesman, and has the management skills that come from being a deputy managing director. He's not very financially sophisticated. But he knew all the buyers at the stores,' Fry says.

He asked Aspin why he was not running his own business. And shortly afterwards Aspin was doing just that, backed by pounds 200,000 from Fry. For 42 per cent of the equity, Fry also guaranteed a bank loan and bought the company a warehouse in Swindon, Wiltshire - 'a stupid investment which has gone down in value'.

The company has flourished, however. Mondian designs mainly ceramic planters, vases, ornaments and photograph frames, made in Portugal, Thailand or China and sold in department stores, garden centres and gift shops.

The two men launched the company in 1989 when LIT and the Thatcher-Lawson boom were going strong. And apart from 1992, when it lost a big high-street store account, Mondian kept doubling turnover. The recession may even have helped - plant pots fitted the bill as a cheapish, presentable gift.

The company is set to earn pounds 1.5m this year and make a small profit for the first time. Crucial to its success has been low-cost but reliable suppliers. A planter that sells for pounds 4.99 costs perhaps 90p from a factory four hours from Hong Kong, although 30p has to be added for transport and duty. Many companies tried to take advantage of this cost gap, but ran into trouble over quality and delivery. So far, these have not been a problem for Mondian, Fry says.

Are the Third World workers who make these products getting a fair deal? The Clinton administration is agitating over overseas workers' rights in such countries as China, but Fry has little time for such concerns. He does not have a clue what the Chinese workers get. 'The factory owner says they'll work 24 hours if need be. He houses the people on site. They come in from the rural areas and after six months, if there's no work, I think they go back. As long as the pots keep coming I don't mind.'

The ultimate aim is to sell the company in a couple of years, when Fry's stake could be worth pounds 2m. He estimates his personal wealth now at pounds 4m, despite the LIT debacle and associated difficulties with a US futures clearing firm and Roger Levitt, the convicted fraudster.

Despite his recent investments, Fry is more than happy to relive the days of Johnson Fry's big successes, when a scheme for buying repossessed houses from building societies brought in pounds 50m from the public in 22 hours. 'The automatic doors burnt out and every time the lift came up there were 30 people in it with their cheques,' he reminisces.

He is also excited about a film made by Benjie, his son, who has just graduated from film school at the University of Southern California. Fry is thought to have invested more than pounds 400,000 in the film, which is about American and British physicists at Oxford. Its working title is E=MC2 , and Fry keeps receiving calls from confused suppliers about 'this E Macsomething man'. The pots had better keep coming.

(Photograph omitted)