Business news 1 October 2024
Small business owners juggle too much. Biggest fall in retail prices since 2021. UK tax burden unlikely to fall. UK growth revised up for last year. House prices, mortgages, markets, insolvencies & more business news that we thought would interest our members.
James Salmon, Operations Director.
Small business owners juggle too much
According to a recent poll of 1,000 small and medium-sized enterprise (SME) owners, 73% reported taking on more roles than expected, with 84% feeling like a ‘Jack of all trades’ in their work environment. The survey, commissioned by AXA UK as part of its ‘Being self-employed shouldn’t be a risk’ campaign, revealed that many owners juggle responsibilities such as accounting, social media promotion, and legal matters. Tara Foley, CEO of AXA, stated: “Running a small business is incredibly rewarding but it also presents a multitude of challenges.” The research highlighted that 61% of owners struggle with time management, while 45% face unpredictable cash flow. Despite the challenges, 10% found running their business easier than anticipated, while 33% felt it was more difficult.
Director confidence falls to lowest since 2022
The Institute of Directors said Tuesday that the fear of looming tax hikes and workplace regulations, expected to be brought in by the UK’s new Labour government, had contributed to the drop in its monthly economic confidence index to minus 38% having fallen from positive territory in July just after the election
Biggest fall in retail prices since 2021
UK retailers have experienced the largest decline in shop prices in three years, with a year-on-year drop of 0.6% in September, according to the British Retail Consortium (BRC) and NielsenIQ. Helen Dickinson, chief executive of the BRC, noted: “September was a good month for bargain hunters as big discounts and fierce competition pushed shop prices further into deflation.” The non-food sector saw the most significant price reductions, with a 2.1% decline. However, food inflation rose to 2.3%, driven by poor harvests affecting cooking oils and sugary products. The overall retail sales volumes increased by 2.5% in August, indicating a positive trend in consumer spending.
UK tax burden unlikely to fall
The UK’s tax burden is projected to remain at its highest level since 1948, currently at 37% of national income, according to Paul Johnson, director of the Institute for Fiscal Studies (IFS). He expressed doubt about any reduction in the near future, stating: “My guess is that it is going to stay there.” The increase is attributed to the 2021 rise in corporation tax and the freezing of personal tax thresholds. The Office for Budget Responsibility (OBR) forecasts that public spending could rise to 60% of GDP by the mid-2070s, driven primarily by escalating health costs. Johnson said: “If you’re going to talk about cutting taxes, you have to talk very clearly about what gives on spending.”
UK growth revised up for last year
The British economy experienced a significant upward revision in growth estimates, with the Office for National Statistics (ONS) reporting a 0.3% increase in 2023, up from a previous estimate of 0.1%. Despite this improvement, the UK remains the second slowest-growing economy in the G7, only ahead of Germany, which contracted by 0.1%. Gora Suri, an economist at PwC, noted: “The UK’s GDP grew by slightly less than originally estimated in the second quarter of this year, but overall the UK economic outlook has improved considerably since the start of the year.” The ONS also revised the GDP growth estimate for the second quarter of this year down to 0.5% from 0.6%. Real GDP per head rose by 0.2% in the three months to June but is still 0.3% lower than last year.
House prices surge as rates drop
House prices in the UK have risen at their fastest rate in two years, increasing by 0.7% month-on-month and reaching an annual growth of 3.2% as reported by Nationwide. The surge has been attributed to the Bank of England’s recent interest rate cut to 5%, which has improved affordability for buyers. Robert Gardner, Nationwide’s chief economist, noted: “Income growth has continued to outstrip house price growth in recent months while borrowing costs have edged lower.” The average house price now stands at £266,094, still 2% below the peak seen in summer 2022. Terraced houses have seen the largest increase in price according to Nationwide, growing by 3.5%, while semi-detached homes and flats saw jumps of 2.78% and 2.7% respectively. Detached homes saw a smaller increase of 1.7%.
Mortgage approvals jump to two-year high
Mortgage approvals reached a two-year high in August, with 64,900 loans approved, up from 62,500 in July, according to the Bank of England’s Money and Credit report. Mark Harris, chief executive of SPF Private Clients, stated: “Mortgage approvals for new purchases rose again, which bodes well for housing market activity in the final quarter.” Additionally, remortgaging approvals increased from 25,200 in July to 27,200 in August, indicating a shift towards better rates from other lenders. Consumer credit borrowing also saw a slight rise, reaching £1.3bn in August. Karim Haji from KPMG noted that “a rise in consumer borrowing in August could signal that many stretched households are still battling the cost of living.” The report also highlighted a growth in large business borrowing and a notable increase in household deposits.
Job-seekers facing fierce competition
Competition among job-seekers surged to its highest level in three years in August, with 2.09 job-seekers per vacancy, according to Adzuna. Vacancies fell by 0.5% month-on-month to 857,765, marking a decline of over 17% compared to the previous year. Tony Wilson, director at the Institute for Employment Studies, remarked that the figures would be a “bit disappointing” for those seeking “greener shoots” in the labour market. He noted, “competition for jobs is returning to more normal levels,” suggesting that the Bank of England could consider lowering interest rates. Meanwhile, annual wage growth, including bonuses, slowed to 4.0%, the lowest since November 2020.
Coal
The closure of the Coal plant in Ratcliffe-on-Soar, Nottinghamshire marked the nations end of coal-fired power generation. After 57 years of operation, our last coal fired power station closed. Having pioneered coal energy with the use of the fossil fuel since 1882, it has now come to an end. However, in 2023, coal contributed just 1% of Britain’s power supply while wind and solar generation hit record highs.
Markets
Yesterday UK blue chip stocks fell 0.7% in line with a softer global tone, rising geopolitical tensions and a near 5% drop in the Tokyo stockmarket following the appointment of new PM Shigeru Ishiba.
Overnight in the US the S&P 500 rose 0.42% to 5762.48 and the NASDAQ rose 0.38% to 18189.17, closing the month at record levels.
This morning on currencies, the pound is currently worth $1.332 and €1.202. On Commodities, Oil (Brent) is at $71.2 & Gold is at $2650. On the stock markets, the FTSE 100 is currently up 0.35% at 8265 and the Eurostoxx 50 is up 0.1% at 5005.
REA and Rightmove
REA Group has formally withdrawn its takeover approach for Rightmove after its fourth approach was rejected yesterday. REA complained there was insufficient dialogue, lack of information that would have enabled a firm offer. Rightmove shares fell 53p in response to the talks ending with its chairman claiming the entire process over the previous two weeks had been’ very disruptive’ and ‘unsettling’.
IW Capital reveals £30m SME growth fund
Tariq Attia has been appointed as the new chief executive of IW Capital, which has launched a growth fund aimed at investing tens of millions of pounds into the UK’s small and medium-sized enterprises (SMEs). This initiative follows a management buyout and allows IW Capital to provide larger investments to high-growth potential businesses across various sectors, including innovative technologies and education. Chairman Alan Armstrong said: “UK SMEs are a core driver of employment and GDP and we pride ourselves on being an active, supportive partner…For our investors, this means access to opportunities which would otherwise be the domain of larger private equity houses.”
Mulberry
Mulberry has rejected a possible takeover offer from Frasers, at 130p per share. It said that it “carefully” considered the offer, and sought feedback from Challice, its 56% shareholder. However, concludes that a combination of the recent appointment of Andrea Baldo as chief executive officer, alongside a capital raising, gives Mulberry “a solid platform to execute a turnaround and, ultimately, to deliver best value for all Mulberry shareholders.”
Pension funds exceed expectations
Research by PensionBee reveals that pension funds are generating higher returns than many Britons anticipate. Over the past five years, leading pension funds have achieved an average annual return of 7.72% for savers 30 years from retirement, with the strongest funds exceeding 8%. Claire Reilly, chief engagement officer at PensionBee, said: “The average fund performance exceeding saver expectations shows that with a well-planned strategy, pensions can deliver strong returns over time.” However, for those nearing retirement, returns align more closely with expectations, averaging 5.25%. A separate study by Scottish Friendly found that 46% of women are more likely than men to keep long-term savings in a standard savings account rather than a pension or ISA.
Hull-based modular building manufacturer folds
Extraspace Solutions (UK) Ltd and its subsidiary Spatial Initiative Ltd, based in Hull, have entered administration, resulting in approximately 100 job losses. A spokesperson from Ernst & Young (EY), the appointed administrators, stated that the companies faced “significant losses” on legacy contracts, which hindered their ability to secure necessary funding for continued operations. Consequently, the directors opted to place the companies into administration. EY is currently assisting those affected by the closure, ensuring they receive appropriate support and advice.
Latest Insolvencies
Appointment of Administrator – HUB ENGINEERING LTD
Appointment of Liquidators – 6M LIMITED
Appointment of Liquidators – BUSBY CONSULTING LIMITED
Appointment of Administrator – IONA SCHOOL ASSOCIATION
Appointment of Liquidators – KH REVCAP (IPSWICH) LIMITED
Appointment of Administrator – HARLAND & WOLFF GROUP HOLDINGS PLC
Appointment of Liquidators – FRUIT DESIGN & MARKETING LIMITED
Appointment of Liquidators – CALDERFIELD CONSULTING LIMITED
Appointment of Liquidators – HUDSON AGENCY SERVICES LIMITED
Appointment of Liquidators – JOHN H. WHITAKER (HOLDINGS) LIMITED
Appointment of Liquidators – JAMES PROPERTY DEVELOPMENTS LTD
Appointment of Liquidators – JUNCTION 10 PROPERTIES HOLDINGS LIMITED
Appointment of Liquidators – COPSON GRANDFIELD LIMITED
Appointment of Liquidators – CTI COMMODITIES TRADING & INVESTMENTS LIMITED
Appointment of Liquidators – GMSIM LTD
Appointment of Liquidators – KERR SURVEYING LIMITED
Appointment of Liquidators – KAYE BONYTHON CONSULTING LIMITED
Appointment of Liquidators – TRS INVESTMENTS (HOLDINGS) LIMITED
Appointment of Liquidators – E M WAGNER CONSULTANCY LTD
Appointment of Administrator – ISUPPLY GROUP LTD.
Appointment of Liquidators – UNSWORTH ASSOCIATES LTD
Appointment of Liquidators – GAURAV SHARMA LTD.
Appointment of Liquidators – PETER HUNT & CO LIMITED
Appointment of Liquidators – LANEBRIDGE HOLDINGS LIMITED
Appointment of Liquidators – PHYLLIS MARY PILKINGTON DEVELOPMENTS LIMITED
Appointment of Liquidators – NORWICH AND PETERBOROUGH INSURANCE BROKERS LIMITED
Appointment of Liquidators – THE CORPORATE ADVISORY SERVICE LIMITED
Appointment of Liquidators – SHERWIN FINANCIAL SERVICES LIMITED
Appointment of Administrator – SAMBRO INTERNATIONAL LIMITED
Appointment of Liquidators – MAXWELL TOPCO LIMITED
Appointment of Liquidators – WORLINGHAM FARMS LIMITED
Appointment of Liquidators – RPP CONSULTING LTD
Appointment of Liquidators – HERITAGE PROPERTY DEVELOPMENT LIMITED
Appointment of Liquidators – YORKSHIRE COAST BID LTD
Appointment of Liquidators – TIM WELLS DEVELOPMENT CONSULTANCY LTD
Appointment of Liquidators – PRIMARY COMPUTING LIMITED
Appointment of Liquidators – LESHY HOLDINGS LIMITED
Appointment of Liquidators – MD PHARMA GLOBAL LIMITED
Appointment of Liquidators – WYLLIEWYE LIMITED
Appointment of Administrator – LAWBIT LIMITED
Appointment of Liquidators – S.C.Q. CONSULTANTS (INTERNATIONAL) LIMITED
Appointment of Liquidators – PARISI OFFICE SERVICES LIMITED
Appointment of Administrator – REDDIFAST STEELS LTD
Appointment of Liquidators – POLYMAX UK LIMITED
Appointment of Liquidators – TRASC LIMITED
Appointment of Liquidators – ADDITIVE MANUFACTURING MATERIALS LTD
Appointment of Liquidators – OMISHA CONTROLS LTD.
Appointment of Liquidators – VERTIGO IT SOLUTIONS LIMITED
Appointment of Liquidators – BONAVENTURE DEVELOPMENTS LIMITED
Appointment of Liquidators – DAVID TARVER CONSULTING LTD
Appointment of Liquidators – REDSHAW ADVISORS EXPERT SERVICES LTD
Appointment of Liquidators – SILVR LINING GROUP LIMITED
Appointment of Liquidators – DNA VENTURES HOLDINGS LIMITED
Petitions to wind up (Companies) – TOWER BRIDGE MARKETING LIMITED
Appointment of Liquidators – CAVERSWALL PARK DEVELOPMENTS LIMITED
Appointment of Liquidators – KBJ DEVELOPMENTS (CHESTERFIELD) LIMITED
Appointment of Liquidators – BARTON ELECTRICAL (UK) LTD
Appointment of Liquidators – EASTGATE CYCLES LTD.
Appointment of Liquidators – GLEN HOUSE CAPITAL STRATEGIES LTD
Appointment of Liquidators – LAN ACTUARIAL SOLUTIONS LTD
Petitions to wind up (Companies) – SOPHISTICATED SOLUTIONS PARTNERS LLP
Appointment of Liquidators – HATCH SQUARED LTD
Appointment of Liquidators – BARDA PARTNERS LIMITED
Appointment of Liquidators – TURNER PROPERTY SERVICES LIMITED
Appointment of Liquidators – CEDAR LEISURE LIMITED
Appointment of Liquidators – FRONT RUNNER TV LTD
Appointment of Administrator – FIBRERAY DESIGN LIMITED
Appointment of Liquidators – AQUARIUS LONDON LIMITED
Appointment of Liquidators – KELISDAR ENTERPRISES LIMITED
Petitions to wind up (Companies) – CMP CIVILS LIMITED
Appointment of Liquidators – TRIGGERFISH LTD
Appointment of Administrator – DELCOR LTD.
Petitions to wind up (Companies) – GHR CONSTRUCTION LIMITED
Appointment of Liquidators – SUTTON TRADING LTD
Appointment of Liquidators – LAURIE MUTCH & ASSOCIATES LIMITED
Why you should become a member of CPA!
The Credit Protection Association (CPA) has been assisting thousands of UK businesses to get paid, since 1914. We have supported our members through all sorts of difficult trading environments. With high interest rates and a struggling economy and elevated insolvencies, our services can help your business navigate these difficult waters.
Unlike other credit management and debt collection companies, we offer a range of services to our members that are all included as part of a fixed annual subscription, tailored to your needs.
Under your annual subscription you will have access to our main services:
- Our Creditcare credit reports provide credit ratings and limits along with a host of detailed information on your potential customers to enable you to trade with confidence and set appropriate credit policies for new customers.
- Our monitoring service will alert you to any significant changes in the status of those customers.
- Our Overdue account recovery service can be used to chase up payment on any invoices to those customers that have not been paid on time. Unlike other debt collection companies, this service directs your customer to pay direct to you and allows you to maintain your goodwill with them, rather than inserting ourselves into your relationship with you customer and insisting they pay CPA instead. Our Overdue account recovery service resolves over 80% of accounts referred to us.
All of the above services and other complimentary services such address verification, are included in your subscription!
And for the small minority of debts not resolved through our Overdue account recovery service, you can refer the debt to our collections department to escalate the late payment collections process.
CPA eases cash from tardy debtors – Efficiently, Effectively, Economically and Ethically. And we provide credit information so you can monitor and assess your key customers and be warned of any potential risks. CPA has been improving business cash flow for over 100 years, by tackling late payers and campaigning against the late payment culture in the UK.
Unlike other credit management companies, we offer our members a fixed annual subscription regardless of how high the value of their debts maybe!
Rather than to borrowing more money to improve your cashflow, CPA suggests that business owners tackle the problem at its source. If late payments are a strain on your cashflow, then talk to CPA about how we can help you reduce those late payments.
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.
The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections
Do you have a commercial late payer that is causing you grief? Use CPA’s no-win, no-fee, commercial debt recovery service!
If you have a particular business customer who is late paying and causing you sleepless nights, why not offer it to CPA’s collection department for purchase on recourse?
CPA’s collection department will then pursue the debt. We will be liable for any costs incurred and then when we have recovered the debt, we will pay you the net principle debt recovered less our percentage.
Once you have enjoyed that success then you can consider the more cost effective membership which includes our Overdue Account Recovery service and Status/Credit reports as well as a range of other complimentary services.
Just call 020 8846 0000 and ask for Godfrey Nelson or Cris Shirley (business hours) or email debtpurchase@cpa.co.uk today.
The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections.
Get compensated for previous late payments
Have you been paid late by business customers in the last six years?
Maybe you no longer work with them. Under legislation, you are entitled to compensation you for those late payments you have suffered.
You put up with the PAIN – now claim the GAIN!
Claim late payment compensation (LPC) from former business customers who paid you late in the last six years!
CPA (LPC) Recoveries is using our bespoke software and decades of experience to do just that for our clients
Check our compensation calculator to see how much your business could be owed!
Discover NOW the potential value of late payment compensation hidden in your sales ledger!
The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections.