DRESSED in a pale green short-sleeved shirt, Rob Templeman did not look like the boss of one of Britain’s leading fashion retailers as he toured the flagship Debenhams store on Oxford Street.

Critics have long sniped that Templeman, who made his name (as well as his fortune) turning round Homebase, would struggle with Debenhams, Britain’s largest department-store chain. Selling a Ben de Lisi dress, they argued snootily, was very different from selling a bag of cement.

But as he discussed with the store manager what type of hanger to use with a £250 ballgown, and themed displays that encourage shoppers to buy matching items and so spend more, Templeman appeared to have found his feet.

“The greatest way to drive sales is to get existing customers to spend more,” he said.

The financial performance at Debenhams is also impressive. Templeman has already paid back £90m to his backers and is confident that the interim results, due to be published in October, will show “a strong performance”.

It is nearly eight months since Templeman, backed by CVC Capital and Texas Pacific Group, bought Debenhams for £1.7 billion.

Templeman and his team spent the first few months reviewing the Debenhams business and cutting costs. “We restructured very quickly, analysed the business and worked out where the future growth was going to come from,” he said.

More than 40 senior managers were interviewed. One Debenhams director said: “They were locked in a room with Templeman and asked to take him line-by-line through the profit-and-loss account for their department.”

Templeman, who carried out a similar review when he arrived at Homebase and Halfords, said: “It provides a great insight into your management team.”

Within months a quarter of head-office staff had been made redundant, as had many of the warehouse staff within the stores. Contracts with suppliers were renegotiated and £50m of stock was liquidated, freeing up much-needed cash.

But Templeman was keener to talk about his plans for growing the department-store chain than about cost cutting.

“There is this misconception that private equity does not invest,” said Templeman. “People will buy only future growth — you need to have the top line growing. When we come to exit, nobody will buy Debenhams unless we grow sales. The days of a quick spin on cost cutting are long gone.”

As part of his plan to grow Debenhams, Templeman has drawn up plans to open “mini-Debenhams” stores on the high street. The 15,000 sq ft stores (the average department store is 70,000 sq ft) will sell cosmetics, health and beauty products, lingerie and a limited range of clothing. The first four trial stores will open in the autumn.

“The great thing about retailing is that you can see the results in weeks or months,” said Templeman.

If they are a success, Templeman plans to open up to 120 in market towns across the country — stores that will compete head on with Marks & Spencer, Boots and Next rather than other department stores.

At a time of intense competition for shoppers — with entrepreneur Philip Green, owner of BHS and Arcadia, promising to take his battle to the high street after the failure of his bid for Marks & Spencer — the “mini-Debenhams” could make life even tougher.

Templeman also plans to change Debenhams’ fashion mix to attract young shoppers. “They come into stores to buy jewellery and make-up yet we don’t even try to sell clothes to them,” he said.

Younger brands such as Top Shop, Wallis, Oasis and Coast will replace underperforming concessions in coming months — the complete opposite of the strategy being pursued by Stuart Rose, chief executive of Marks & Spencer, who has vowed to focus on the 35-55 age range.

But does Templeman not worry about his lack of fashion experience? “Coming in from outside clothing you approach it in a different way,” said Templeman, who believes that many in the clothing sector are too focused on buying rather than selling.

Meanwhile, speculation about consolidation in the department-store sector has intensified in recent weeks after the revelation that Minerva, the property company that controls the majority stake in Allders, has put itself up for sale.

Debenhams has long been linked with Allders and House of Fraser, where activist shareholders own more than 20% of the shares.

But Templeman was keen to play down talk of mergers in the near term. “We have the firepower to make acquisitions if we want. But it is low on the agenda. If the right deal was there, we would look at it.”

For now he wants to concentrate on growing the business and preparing the group for the inevitable sale or flotation.

Having made £600m for Permira in less than 18 months by turning round and then selling Homebase, few people would bet against Templeman succeeding.