Business news 5 March 2024
Wet weather dampens UK retail sales. M&S boss slams Tory tax policies as “economically illiterate”. And more business news that we thought would interest our members.
James Salmon, Operations Director.
Wet weather dampens UK retail sales
High street shops and restaurants in the UK experienced a slowdown in retail sales growth in February, with sales of non-food items declining by 2.5%. The decline was attributed to weak consumer confidence and the continued pressure of living costs. However, food sales increased by 6%, albeit at a slower rate than the previous month, according to the latest retail sales monitor from the British Retail Consortium and KPMG. The combination of food and non-food sales resulted in a 1.1% overall increase in retail sales. The wet weather in February led to increased spending on digital content and subscriptions, while spending in restaurants contracted by 13.4%. Linda Ellett, UK head of consumer, leisure and retail at KPMG, said: “As many households continue to adapt budgets to meet higher essential costs, including higher mortgage rates, consumer reluctance to get out there and start spending is likely to remain in the short term. With big increases in labour costs and business rates just weeks away, adding to an already stressed cost agenda for retailers, many will be pinning their hopes on some good news in the chancellor’s spring budget this week to help to kick-start a spending revival.”
M&S boss slams Tory tax policies as “economically illiterate”
Marks & Spencer CEO, Stuart Machin, has criticised the Government’s tax policies, calling them “economically illiterate” and urging a reconsideration of the inflation-linked increase to commercial property taxes. Machin also called for the Government to fix the broken business rates system, reform the apprenticeship levy, and scrap the tourist tax. He argued that the current policies make it hard for retailers to be employers and run stores. Other retail bosses have echoed these concerns, warning that the minimum wage increase and rising business rates will lead to sustained inflation and hinder investment and growth. Machin also highlighted the need for changes to the apprenticeship levy rules to support skills development and training in the retail sector.
IFS warns non-dom plans could drive away super rich
The Institute for Fiscal Studies (IFS) has said abolishing the non-domiciled tax regime could backfire and raise less money than expected. IFS senior economist Stuart Adam said: “The more ambitious tax-raising reforms are, the greater the potential revenue yield – but also the greater the risk that the UK would attract fewer non-doms and lose the tax revenue they bring in.” He explained: “Whatever the reform, it should be based on a careful weighing of the long-run pros and cons. Changing the regime in order to fund pre-election tax cuts would not be a good reason for making such a change, whatever the pros and cons of any reform adopted.”
Labour sets out plans to reduce the number of young people out of work
Labour promises tougher measures on benefits payments to reduce the number of young people out of work, education, or training. Shadow work and pensions secretary Liz Kendall plans to recruit more mental health workers and reform the apprenticeship levy. The plan focuses on recruiting mental health professionals and career advisers, funded by targeting tax breaks for private schools and closing tax loopholes used by private equity fund managers. New figures show an increase in the number of young people not in education, employment, or training. In a speech to the Demos think tank on Monday, Ms Kendall said: “This is our commitment to young people – we value you, you are important. We will invest in you and help you build a better future, with all the chances and choices this brings. But in return for these new opportunities, you will have a responsibility to take up the work or training that’s on offer.”
Greggs
Greggs reported that sales in 2023 climbed to £1.81 billion from £1.51 billion a year earlier. Pretax profit increased to £188.3 million from £148.3 million.
Apple
Apple has been hit with a €1.8 billion fine by the European Union over supposed abuse of its dominant position in the music streaming market. “For a decade, Apple abused its dominant position in the market for the distribution of music streaming apps through the App Store,” EU competition chief Margrethe Vestager said on Monday.
Microsoft
Microsoft hit back at the New York Times’ lawsuit that claims OpenAI illegally copied its articles to feed ChatGPT, claiming the Times is standing in the way of ground breaking technology.
China
China set a growth target of 5% for 2024, which analysts think will be hard to reach.
Spirent Communications
Spirent Communications said it has agreed on its acquisition by Viavi Solutions for 175p per share in cash. Spirent shareholders will receive 172.5p cash, plus a 2.5p special dividend. The acquisition values the company at £1.01 billion (a 60% premium). Spirent’s board said it recommends the Viavi offer to shareholders. Also on Tuesday, Spirent reported its full year results for 2023. Spirent said revenue fell to $474.3 million from $607.5 million Pretax profit plummeted to $22.9 million from $114.6 million.
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Why should you become a CPA member!
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 some time to come.
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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!
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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!
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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.