Business news 6 August 2024
Warm summer weather boosts retail sales. UK private sector economy buoyed by strong demand. Reeves in the US, Tech sector stalls, market turmoil, insolvencies & more business news that we thought would interest our members.
James Salmon, Operations Director.
Warm summer weather boosts retail sales
Retail sales recovered last month as warm weather finally arrived in the UK. According to industry data from the British Retail Consortium, total retail sales increased by 0.5% year on year in July, with people buying summer clothes and health and beauty products. However, spending on furniture and household appliances weakened as consumers cut back. Linda Ellett, the UK head of consumer, retail and leisure at KPMG, said: “Spending levels continue to be governed by whether households have been able to absorb the likes of mortgage and rent increases, or had to limit their spend elsewhere as a consequence.” Separate figures from Barclays showed a decline in overall consumer card spending, with discretionary spending remaining selective.
UK private sector economy buoyed by strong demand
The S&P Global UK purchasing manager’s index (PMI) shows that demand for UK services is growing at the fastest pace since May 2023, with a surge in new clients and contracts. The PMI rose to 52.8 in July from 52.3 the previous month after companies saw a surge in demand from international markets. In contrast, France and Germany are experiencing a slowdown in activity, with French business confidence at its lowest level this year and German business activity falling for the first time since March. Joe Hayes, principal economist at S&P Global Market Intelligence, said: “With the general election period coming to an end at the start of July, survey data for last month showed the UK service sector enjoyed a modest rebound after a fairly subdued end to [the second quarter].
Rachel Reeves visits Wall Street to encourage investment in Britain
Rachel Reeves has travelled to New York and Toronto to encourage investment in Britain during talks with Wall Street leaders. Her trip coincided with a global stock market rout, with the FTSE 100 falling 2.4% and Japan’s Nikkei 225 suffering its worst day since 1987. Analysts fear a potential American recession and believe the US Federal Reserve may have made a mistake by not cutting interest rates. During her trip, Reeves will meet with bosses from major US and Canadian industries, host a reception to celebrate women in finance, and meet with clean energy and infrastructure leaders. She aims to attract private sector investment to create jobs and improve opportunity across Britain.
UK tech sector growth stalls
Growth in the UK’s tech sector is stalling, with new data showing a sharp slowdown. The number of new tech companies incorporated in the UK fell by 11% in Q2 2024, marking the first decline since early 2022. London, the leading region for tech incorporations, experienced a 16% decline in growth. Ben Bilsland, partner and head of technology at RSM UK, expressed concern over the potential impact on the UK economy and urged the Government to support the sector. The analysis comes after the Government’s decision to shelve £1.3bn in promised funding for tech and AI projects.
FRC seeks public input on ‘going concern’ guidance
The Financial Reporting Council (FRC) is seeking public comments on proposed changes to its ‘going concern’ guidance. The FRC wants companies to take a longer-term view of the risks of going bust and issue warnings if they are at risk of going out of business. The updated guidance draft encourages company bosses to think more broadly and aligns with changes to relevant rules such as the corporate governance code
Markets
Yesterday, the global market drop continued as fear of a US recession took hold. The falls continued, although European investors appeared less concerned at the sell off than in Asia where Tokyo lost 12.4%, Taipei fell 8.3% and Seoul gave up 8.8%. with the FTSE 100 closing down 2.04% at 8008.23 and the Euro Stoxx 50 closing down 1.45% at 4571.60. Overnight in the US stock markets fell sharply following falls in Europe and Asia. The S&P 500 dropped a further 3.00% to 5186.33 and the NASDAQ also fell 3.43% to 16200.08.
It comes after weak jobs data in the US on Friday sparked concerns about whether the world’s largest economy would tip into recession. The weaker-than-expected jobs data also stoked speculation about when the Federal Reserve would cut rates. London’s FTSE 100 was 2% down at close on Monday while the FTSE 250 ended 2.8% lower. UK banks were among the index’s biggest fallers, with shares in Barclays, NatWest and Lloyds dropping as much as 5.2%, 4.8% and 4.4%, respectively.
Tokyo’s stock market rebounded 10.23% on bargain hunting but remains 9% below Wednesday’s level. Japan reported a rise in overall wages but a decline in household spending.
This morning on currencies, the pound is currently worth $1.2698 and €1.1641. On Commodities, Oil (Brent) is at $76.43 & Gold is at $2414. With stock markets, the FTSE 100 is down 0.27% at 7986 and the Eurostoxx 50 is down 0.38% at 4554.
Thames
Thames Water was fined £104m by Ofwat as part of a £168m fine for three UK water companies for sewage spills.
Google
A US federal judge ruled Google had acted illegally in maintaining its search monopoly and in stifling competition.
Over 1.3m households no longer paying council tax
More than 1.3m households in the UK are no longer paying council tax, resulting in local authorities failing to collect a record £6bn annually, according to a report by the Centre for Social Justice (CSJ) think tank. The report highlights that council tax debt has doubled in the past six years, with the debt now representing almost a sixth of total income from the charge. Councils have increasingly relied on council tax to fund services, as central government grants have fallen by about a third in a decade. The report suggests that harsh enforcement measures and the threat of imprisonment have driven down collection rates. The average household in debt owes £1,726, and the debt particularly affects the poorest residents. The report calls for a more proportionate collection system to improve repayment rates and increase the amount of money brought in by councils in the long term
Sales of EVs expected to grow more slowly than expected
The Society for Motor Manufacturers and Traders (SMMT) has revised down its forecast for EV sales, predicting that they will account for 18.5% of the new car market in 2024, down from the previous estimate of 19.8%. The SMMT also lowered its forecast for the overall new car market in 2024. Despite the decline in the forecast, EV sales surged by 18.8% in July, with hybrids experiencing the strongest growth. However, private consumers accounted for only 19.4% of EV sales, down from 23.7% last year. Experts attribute this to the higher upfront cost of EVs and the lack of financial incentives for private buyers. Car makers are calling for greater support for consumers and action on incentives and infrastructure to accelerate the transition to EVs.
Motorists warned of “permanently high” costs under labour
Drivers have been warned they face years of “permanently high” costs under Labour. Motoring bodies have cautioned that the Government may increase fuel duty to raise £2.5bn. The AA expressed concern that costs could worsen if the 14-year freeze on fuel duty is lifted. Former chancellor Jeremy Hunt froze the levy on petrol for the 14th consecutive year in his spring Budget. Luke Bosdet of the AA warned that reversing the 5p cut would have a detrimental impact on drivers, businesses, and the economy. According to official forecasts, the Government could raise £2.5bn in 2025-26 alone by reversing the 5p cut and uprating fuel duty with inflation.
Latest Insolvencies
Appointment of Administrator – EUROSPAN LIMITED
Appointment of Administrator – ANARCHY BREW CO. LIMITED
Appointment of Administrator – UNITED INDEPENDENT DISTRIBUTORS LTD
Appointment of Administrator – MARSTON BOOK SERVICES LIMITED
Appointment of Administrator – ORCA BOOK SERVICES LIMITED
Appointment of Liquidators – ZANDER DEVELOPMENTS LIMITED
Appointment of Liquidators – MERLION CAPITAL DEVELOPMENTS LTD
Appointment of Liquidators – LINGFIELD LTD
Appointment of Liquidators – WHITE CLIFFS PROPERTY HOLDINGS LIMITED
Appointment of Liquidators – DATA CENTRE SYNERGY LTD
Appointment of Liquidators – NCORE CONSULTING LTD
Appointment of Liquidators – NEWGATE DEVELOPMENTS (BOURNEMOUTH) LIMITED
Appointment of Liquidators – TEL MECHANICAL ENGINEERING LIMITED
Appointment of Liquidators – SOURCING & SUPPLY-CHAIN SOLUTIONS LIMITED
Appointment of Liquidators – COTSWOLD HARDY PLANTS LTD
Appointment of Liquidators – MACGREGOR PHARMA CONSULTING LIMITED
Appointment of Liquidators – SEABORNE CONSULTANCY AND INVESTMENT LIMITED
Appointment of Liquidators – NORTHCOTE RYDER LTD
Appointment of Liquidators – BRYANT PEERS (INVESTMENTS) LIMITED
Appointment of Liquidators – IST TECHNOLOGIES LIMITED
Appointment of Liquidators – EPRAISE LIMITED
Appointment of Liquidators – BRAY CONSULTING LTD
Appointment of Liquidators – DRIVERFIND LIMITED
Appointment of Liquidators – PYRRHO CONSULTING LTD
Appointment of Liquidators – EMPETUS LIMITED
Appointment of Administrator – 5 P.M. LTD.
Appointment of Liquidators – BUTTERCUP NURSERIES LIMITED
Appointment of Liquidators – EDENBALLY LIMITED
Appointment of Liquidators – IDEASHARE LIMITED
Petitions to wind up (Companies) – ELIXIR RESOURCING LIMITED
Petitions to wind up (Companies) – MOKARABIA LIMITED
Appointment of Administrator – CENTILI LIMITED
Appointment of Liquidators – O & P MANAGEMENT LIMITED
Petitions to wind up (Companies) – TRADE CONTRACTORS LTD
Petitions to wind up (Companies) – BURRITO GRILL LIMITED
Appointment of Liquidators – CREATIVE PRO MEDIA LIMITED
Appointment of Liquidators – AETNA GLOBAL BENEFITS (EUROPE) LIMITED
Appointment of Liquidators – SOMERSET CAPITAL MANAGEMENT LIMITED
Appointment of Liquidators – SOMERSET CAPITAL MANAGEMENT LLP
Appointment of Liquidators – INTERTISSUE LIMITED
Appointment of Administrator – CHRISTIAN JAMES VENTURES LIMITED
Appointment of Liquidators – JED FURNISS PROPERTY LIMITED
Appointment of Liquidators – WDRC LIMITED
Appointment of Liquidators – H.G. HOMES (BOTTESFORD) LIMITED
Appointment of Liquidators – HGSPS (MANSFIELD) LIMITED
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 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.
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.
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 turning to more debt, CPA suggests that business owners tackle the problem at its source. If late payments are a strain on your cash flow, then talk to CPA about how we can help you reduce those late payments.
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. CPA’s overdue account recovery service is a polite, efficient service designed to encourage prompter payments while maintaining goodwill. We direct your customers to pay directly to you, not to us and want to support and reinstate your direct relationship with your customer, not take it over, destroying goodwill.
Unlike other credit management companies, our overdue account recovery service is available to our members on a fixed annual subscription so you can pass any overdue accounts to this service and it is included in your subscription!
Our Overdue account recovery service resolves over 80% of accounts referred to us although our collections department is there to escalate the collections process on the remaining few if you require it.
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 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.