Rapid Recovery predicted – business news 14 August 2020.
14 August 2020.
James Salmon, Operations Director.
A rapid recovery is predicted, a call to extend loan repayment freezes, economic rollercoaster ahead, a bombardment of applications, repossessions and lots more business, market and covid news.
Here are CPA we want to share the business news stories we have seen that we think will affect our members and readers. Many of us are busy fighting to protect our businesses and therefore might have missed some of the news that could impact small businesses, their owners and those that sell on credit.
REC predicts rapid recovery
The Recruitment and Employment Confederation (REC) has predicted a Rapid recovery. It has revealed that a rapid “V-shaped” economic recovery appears more likely, with Office for National Statistics figures showing that online adverts for vacancies in the UK are now at 62% of their 2019 levels.
Figures show that there are 1.1m positions available, with around 125,000 new postings added in the past week.
Neil Carberry, chief executive of the REC, has called for a cut to employers’ National Insurance tax to boost hiring and help firms keep on existing workers. He commented: “It’s important to remember that we are not just passengers in all of this – we have tools available that can minimise the unemployment increase that is coming.”
Which?: Extend loan repayment freezes
Consumer group Which? has urged the Financial Conduct Authority (FCA) to extend loan repayment holidays and interest-free overdrafts until January 2021, saying demand for support will surge after the job retention scheme ends on October 31.
Which? head of money, Gareth Shaw, said: “The regulator has acted quickly and effectively to help those struggling financially due to the pandemic, but it must be prepared to take further bold action to prevent millions of people from being hit by a perfect storm of financial pressures in the coming months.”
Economic ‘rollercoaster’ yet to come
Ed Conway in the Times says the economy is set to see some “critical adjustments” in the wake of the coronavirus crisis and warns that the tax system “is ill-prepared for them”.
Pointing to business rates, he says: “They are predicated on the idea that having a physical premises is an advantage for a company. But now that physical premises might just as well be considered a liability, does it really make sense to tax them so much?”
Mr Conway says analysis of the economic impact of COVID-19 should not focus on “lurches in GDP” in the last quarter or this, arguing that the “real rollercoaster has yet to come.”
Firms ‘bombarded’ with applicants
Analysis by CV-Library shows that in the wake of the coronavirus crisis, firms are seeing thousands of applications for jobs which would previously have attracted far fewer applicants. Among positions drawing a large number of applicants was a trainee accountancy job for which 3,272 people applied.
CV-Library received a record number of applications last month as a number of professional workers were made redundant or were furloughed. The jobs website’s CEO Lee Biggins said the jobs market “has done a complete 180”, adding that while companies may have struggled to recruit before the pandemic, “they’re now being bombarded with applications from professionals who are desperate for a new job”.
Repossessions down 93%
Figures from UK Finance show that property repossessions have fallen by more than 90%, with homeowners opting for mortgage holidays amid the coronavirus crisis and banks banned from seizing homes amid the pandemic.
There were just 90 owner-occupied homes repossessed in Q2, a 93% decline on Q2 2019, while 130 buy-to-let properties were repossessed, an 80% dip. The Financial Conduct Authority has said that mortgage lenders should not start or continue court action for repossession until at least October 31.
Covid-19 general news
Global cases top 20.9 million and deaths pass 759,000
The Government has reintroduced quarantine rules for those traveling to the UK from France and the Netherlands, with travelers haveingto quarantine themselves for a fortnight, as Europe struggles to contain a new wave of coronavirus infections. An estimated half a million British tourists are currently in France, many having taken advantage of the recently relaxed travel arrangements between the countries. The French government warned of reciprocal measures. Transport Secretary Grant Shapps said the measure – which also applies to people travelling from Monaco, Malta, Turks and Caicos, and Aruba. He added that this was necessary to keep coronavirus infections down.
Prime Minister Boris Johnson said England can resume the paused easing of lockdown rules, with soft play areas, theaters, casinos, spas, bowling centres, ice rinks and beauty parlors allowed to reopen – but warned of tougher penalties for breaking social-distancing restrictions. £100 fines for not wearing a face mask will double with each offence up to a maximum of £3,200 for repeat offenders in the coming weeks, the government said today. Wedding receptions can also take place with up to 30 guests at a sit-down meal.
The U.K. signed another deal to purchase doses of an experimental vaccine for Covid-19, this time from Novavax Inc. The U.K. will help Novavax conduct a third-phase clinical trial, which should start in the third quarter, the company said.
The government is testing a new contact-tracing app aimed at helping to identify people exposed to the virus. The goal is to be able to isolate individuals at risk without once again freezing the entire economy.
The leaders of just one in five National Health Service trusts said the U.K. government has taken the correct approach to coronavirus testing so far, according to a survey by NHS Providers. In addition, two thirds of respondents said the government’s testing strategy would not meet the needs of their users over the next three months. Novavax will produce up to 180 million doses of the vaccine annually in northeast England.
Germany added the most new cases since May, while the head of the French Health Agency Jerome Salomon said the situation in his country is worsening
Infections continued to rise in Spain, prompting warnings from business leaders about the cost to the economy if new lockdown measures have to be imposed
Donald Trump said that he would block covid-relief funds for America’s struggling postal service because helping it would be tantamount to giving “election money” to the Democrats. Despite the country’s raging covid-19 epidemic, Mr Trump wants to block widespread postal voting, which he fears would favour his opponents. He also, without proof, claims it would lead to mass election fraud.
Democratic nominee Joe Biden said U.S. governors should require masks for the next three months, an approach he said would save more than 40,000 lives, though President Donald Trump said this would be unenforceable
The total number of victims of coronavirus in Peru may be as high as 50,000, almost double the official number, a government official said.
Mexico’s confirmed cases rose by 7,371 to 505,751, according to data released by the Health Ministry. Deaths increased by 627 to 55,293.
Brazil reported 60,091 new infections, the biggest daily increase since July 29, according to the Health Ministry’s website. Brazil’s total, the second-highest after the U.S., rose to more than 3.2 million.
Markets.
Stocks fell yesterday, breaking a streak and the sell off has continued this morning with the FTSE down 1.5% yesterday and a further 2% this morning, sitting at 6055 at the time of writing. Asian Markets traded mostly higher with investors remaining cautious after US lawmakers seemed unable to move forward with a coronavirus stimulus bill. S Markets closed lower yesterday as traders digested better-than-expected unemployment data and monitored the stalemate in stimulus negotiations. In Asia, Nikkei closed up 0.17%. Hong Kong HSI is up 0.03%. China Shanghai SSE is up 1.19%. Singapore Strait Times is down -0.15%. . Overnight in the US , S&P 500 dropped -0.20%. NASDAQ rose 0.27%.
Oil prices were broadly stable after the International Energy Agency lowered its 2020 oil demand forecast following global travel restrictions, whilst recent data showing a decline in US crude inventories provided some support.
Gold prices firmed above $1,900 on Thursday as the dollar fell and bargain hunters bet on a resumption of bullion’s broader upwards trend after its steep slide from a record peak.
US unemployment
US Unemployment Claims data today showed the number of Americans seeking unemployment benefits has dropped below 1 million for the first time since the coronavirus pandemic began. According to the United States labor department, 963,000 filed jobless claims last week, down 228,000 from the week before. More than 9m jobs have been regained in the past three months—about 42% of the 22.2m lost in March and April.
Tech war
War has broken out between the maker of Fortnite, one of the world’s most popular video games, Apple and Google. Irked at the 30% cut the big app stores levy on in-app purchases, Epic Games offered players a way to circumvent it. Apple kicked Fornite off its platform, with Google following suit; Epic sued, likening Apple to “the monopolists of yesteryear”.
West End warning
Business leaders have warned that more than 50,000 jobs are at risk in the West End of London if there is not a notable increase in shoppers and commuters, with visitor numbers down by close to two thirds in July compared to the same period last year. Business leaders fear that close to one in four of the 216,000 jobs in the shopping and hospitality district could be lost in a wave of failed businesses and redundancies. West End businesses are being hit by a steep fall in the number of foreign tourists, who usually spend £4.3bn in the district each year, according to data from PwC.
Rethinking the tax system
Writing for This is Money, Paul Falvey of BDO looks at the pressure on Government finances brought about by the coronavirus pandemic, saying there is a need to “strike a new financial settlement as the usual incremental approach is unlikely to be sufficient.”
He argues that a rethink of the tax system through simplification and digitisation “would be a great next step”, noting that there are early signs that reform is underway. Mr Falvey says Making Tax Digital “won’t be pain-free” but should prove more efficient if there is adequate investment in HMRC’s systems. He also considers the possibility of rethinking business rates, noting a BDO poll showing 84% of businesses support replacing the levy with an online sales tax.
On employment taxes, Mr Falvey says a merger of income tax and NIC would make tax filing simpler and more transparent, although headline rates of tax would be higher. With the Chancellor asking the Office of Tax Simplification to review capital gains tax, Mr Falvey says he hopes any change will “go hand in hand with a rethink of inheritance tax so that all our taxes could operate coherently going forward.”
Net pay anomaly sees tax inequality
Phil Brown, director of policy at The People’s Pension, has voiced concern over a “stark tax inequality”, saying an estimated 1.5m lower-paid workers are being deprived of pension tax relief due to a net pay anomaly. He highlights that members of pension schemes that use the “relief at source” mechanism and who do not earn enough to pay income tax are granted 20% tax relief on up to £2,880 of pension contributions, meaning that HMRC will top up their contribution to £3,600. However, where a pension provider operates a “net pay arrangement”, the lowest-paid members will miss out because they do not earn enough to receive the relief.
New Look seeks rent shake-up
Fashion retailer New Look is to ask store landlords to agree to a shake-up that will see rents based on how much each shop takes in sales. New Look is proposing the move to turnover-based rents through a CVA as it looks to reduce the rent bill on its almost 470 stores. Nigel Oddy, chief executive, said that the CVA was being launched “out of absolute necessity” because of the impact of coronavirus on the chain’s finances. New Look, which will inject £40m of new funds to help drive growth and cut debts from £550m to £100m through a debt-for-equity swap deal, has also launched a sale process as it looks to determine interest from investors for its shares and assets.
Landlords question Select rescue plan
Landlords have criticised retailer Select’s bid to cut rents and break leases on stores. The fashion retailer has proposed paying no rent for 49 stores via a CVA that would also give the chain the power to break leases early. Select has proposed moving 99 stores to turnover-based rents and terminating a further nine leases. Melanie Leech, chief executive of the British Property Federation, said: “It is deplorable that the business is again attempting to exploit the CVA process,” describing the suggestion that Select should be given new rights to break leases on stores that have benefited from rental discounts as “outrageous”.
Bagel firm bought out of administration
Bagel Nash, which produces and sells artisan bagels, has been bought out of administration by Golden Acre Bakery. BDO managed the accelerated merger and acquisition process.
Don’t let Covid-19 bust your business!
It will if your cash flow dries up, either sooner or later.
The Credit Protection Association (CPA) has been assisting thousands of UK businesses to get paid since 1914. We have seen many financial crises, this one will be particularly deadly for suppliers for sometime to come.
CPA eases cash from tardy debtors – Efficiently, Effectively, Economically and Ethically. Above all tactfully, because maintenance of goodwill is paramount.
To meet the needs of creditors in the current crisis, we have designed a “critical care” package especially tailored for the situation.
- The annual package costs start at very low rates
- A minimum performance warranty is provided
- Several complimentary services included
Clients instruct CPA on-line via their PC or phone, completely user-friendly. Your late paying customers are told to pay you direct (not to us).
A very recent report shows a 23% increase in the number of unpaid invoices since March 11th THIS YEAR – are you getting a build-up of late payers?
Right now, overdue accounts must be a concern and CPA has a great track record of encouraging slow-payers to pay their suppliers quickly.
It takes less than 17 minutes to see how you would benefit, do you have the time now?
No face-to-face meeting required – just call Peter Uwins, CPA’s National Sales Manager, on 020 8846 0000 (business hours) or email nsm@cpa.co.uk today.
When you see your money come in, you will be so glad you used CPA.
Do you sell on credit?
With pressures on the cash flow it is essential that you stay on top of the credit limits you grant customers and watch carefully for any late payments.
Those customers will look for the easiest option to boost their cash-flow. Don’t let it be you.
You can’t just assume your customers can and will pay you eventually, no matter how big their name is.
It is essential to have credit management systems in place to monitor and check your customers credit worthiness.
It is also best practice to use a trusted third party like CPA to make sure you are paid on time by customers, no matter how good a name they have.
About CPA
The Credit Protection Association can help!
Formed in 1914, CPA has been providing credit management services to SMEs for over 100 years.
At the Credit Protection Association, we provide first class credit information that can help you avoid being over extended to customers who are at risk. Our monitoring service can flag up warning signs long before the end, giving you the chance to adjust and reduce your exposure. We provide recommended credit limits and credit scores on a traffic light system and can help you set appropriate credit policies for your customers.
We regularly publish lists of the latest insolvencies but by then it is too late. Our credit reports however predict approximately 96% of company insolvencies long before they arrive.
Companies in trouble usually have very bad cash flow and they try to deal with it by delaying payment to their suppliers, increasing your exposure to them.
If you supply on credit, help us help you identify the risks.
Why use a third party collector?
As a third party collector, we can also get your payments prioritised over those who are not as hot on collections. When your customer receives a letter from the Credit Protection Association regarding their outstanding account, they are going to want to get that resolved as a priority. Our overdue account recovery service can get your unpaid invoices to the top of their “to do” list and get your invoice paid.
Over the years we have collected billions in overdue invoices for our customers.
Our debt recovery and credit management services give our members the financial freedom needed to grow and prosper, while our new Late Payment Compensation department could unlock hidden potential and offer the compensation needed to springboard your business to success.
You might be hesitant about contacting a debt collection agency. What are they going to be like?
Can they help your particular type of business?
There is no need for concern. CPA are courteous, helpful and very probably have had direct experience of working with your type of business.
Debt collection agencies are not all alike.
Success lies in both recovering money and keeping customers happy. The Credit Protection Association was founded in 1914 and has helped tens of thousands of UK businesses to collect outstanding payments and reduce the risk of incurring bad debt. We believe that creditors deserve to be paid for the work or goods they have supplied but we fully understand the need to maintain
the best possible relationship with customers!
At The Credit Protection Association, we provide solutions, advice and back-up in all areas relating to the supply of services or goods on account. Client-members receive everything they need from a single source to reduce debtor days and write-offs.
The Credit Protection Association has helped has assisted tens of thousands of UK businesses with their credit control requirements, since the First World War.
We are polite, firm and efficient when it comes to recovering outstanding debt.
“We have used CPA for a number of years now. The website is easy to navigate around with lots of helpful reports. The staff are always at hand and very friendly. CPA has helped us reduce our debt over the years and keep track of potential issues with our customers.”
~ CPA client in Buckinghamshire
“The service from CPA has proved to be everything that you said it would be. We have already seen a huge benefit. We have had a number of overdue accounts paid promptly and directly to us. It is also a huge weight off our mind to know that once we have passed an overdue payment over to you, you take care of everything whilst keeping us informed.
~ Credit Controller client in Warrington
The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections
Ready to speak to an advisor?
For help or advice on credit management, entirely without obligation.
Call us today
0330 053 9263
CPA is passionate about late payment
The Credit Protection Association has been protecting smaller firms against poor payment practices for over 100 years.
We are extremely passionate about breaking the late payment culture that holds back the UK economy and threatens many SMEs with cash flow difficulties being the single biggest killer of Britain’s small businesses.
If you were regularly paid late we can help. Those former customers used you to boost their own cashflow, regularly paying you late.
As a result you had extra costs, you had the distraction of having to chase payment, you had opportunity costs because your capital was tied up in their late invoices.
Under little used legislation, you are entitled to compensation for those late payments.
Now you can boost your own cash-flow.
CPA can help unearth the those hidden treasures.
We have the technology to reveal the compensation you are due and we have the extensive experience and expertise to then turn those claims into cash.
Yes, CPA can help you boost your business cash-flow.
Don’t let your bankers control you, contact CPA today.
The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections
Do you realise you could be sitting on a fortune?
Late payments often result in a cash flow crunch and leave SMEs in need of a cash injection.
If you sold B2B on credit then there may be a hidden source of capital you can call on.
If you fancy an bit of extra cash in your business, rather than jumping through hoops with your bank, you could look to uncover the resources from an unexpected source within your own business.
Not many are aware but there could be a hidden fortune within your business, sitting there, just waiting to be uncovered and released.
We can help you uncover the pile of gold, you didn’t even know you were sitting on.
If you trade with other businesses and were often paid late then you could be entitled to significant compensation.
Under little known and under-utilised legislation your business could be due huge amounts in compensation that you didn’t even know about.
Let’s be clear – this is not a way to weaken any customer relationships you value. It is one that identifies who’s been paying late and then recover the potentially significant sums in compensation using Late Payment Legislation from businesses where the relationship has already ended.
You can pick and choose who you want us to follow up – but once we’ve agreed which companies you’d like to pursue compensation from it’s a fast process and there’s no financial outlay to you whatsoever. My team at CPA put its expertise to work to recover the compensation due and fight late payment culture.
That compensation could provide the cash boost your business needed.
But don’t delay, that compensation evaporates if not claimed within six years of the late payment.
How can CPA help?
CPA has developed a unique technology to dig into your accounting records and discover the cash injection you are due by means of compensation. The software does all the hard work. Our software interacts over the cloud with over 300 different software packages, working directly with your accounts package, just so long as it’s stored on a computer.
We recognise that most companies do not have the resources to spend time on the identification and calculation of Late Payment Compensation. Our service can produce an Analyses within just a few days with (usually) less than 30 mins of co-operation from our clients. We work directly with over 300 accounting packages but can also work with bespoke accounts packages. Indeed, speed is essential as the oldest invoices may fall foul of the 6-year time limit.
Once the Sales Ledger Analyses is made available to clients, all that is required is that management decide which commercially sensitive ex-customers to remove from the list and return it to us.
CPA then uses its years of collection experience to explain and recover the Late Payment Compensation Claims. Clients do not handle any part of the recovery process as our team will take all communications from the companies against who the claims has been made. Often, it’s simply a case of explaining the legislation, sometimes we have to go all the way and enforce the legislation through the courts.
The result is that we are realising clients’ claims worth tens and sometimes hundreds of thousands of pounds which, of course, is pure net profit. You may also be among the recipients of “hundreds of thousands of pounds” should you elect to take advantage of our services.
We do the work, you receive the cash.
If you have supplied goods and services to businesses on credit and were regularly paid late then you could be due significant sums in late payment compensation.
We are talking to companies and unearthing claims in the hundreds of thousands from former business customers who paid them late. Large business customers who abused their power to inflict unfair and sometimes illegal payment practices.
We are helping business owners who are looking to boost the returns from their business before they retire. We are helping businesses who have lost major clients after years of loyal service to get properly compensated for systematic late payment. We are helping companies that were looking to close down, who looked insolvent and finding that cash injection they need to avoid insolvency.
Those former clients who regularly paid you late can finally be made to pay.
Ready to speak to an advisor?
For help or advice on credit management, entirely without obligation.
Call us today
0330 053 9263
The Credit Protection Association is a credit management company established in 1914. If you supply goods or services on credit then we can help you!
The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections
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The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections