Business news 14 August 2023

James Salmon, Operations Director.

Small firms face cost-of-doing-business crisis. Amazon responds to pressure on withheld payments. Resilient economy makes rate rises more likely.  And more business news that we thought would interest our members.

Small firms face cost-of-doing-business crisis
A poll by small business lender Bibby Financial Services shows that almost half of SMEs think the current business climate is worse now than during the pandemic. Four in ten believe trading conditions are tougher now that they were amid the pandemic, while more than a third said the global economy is doing worse than it was after the 2008 financial crisis. Jonathan Andrew, chief executive at Bibby, said business owners “are battling with a cost-of-doing-business crisis on two fronts: significantly higher costs and monetary policy leveraged to tackle this primary issue.”

Amazon responds to pressure on withheld payments

Amazon has bowed to pressure and agreed to release payments it was witholding from some sellers

Last week we reported that Amazon had impossed a new policy on its sellers, witholding payments made by customers for two weeks in case those customers requested a refund. The change on policy put many of its small business sellers at risk of failure as their already tight cashflow model couldn’t be sustained.

Amazon has now told some of these sellers that there will be a temporary respite and the change in policy will be delayed until January 2024. Not a change in policy though, simply a delay in the anguish. Many small businesses willl now need to use the next few months to build up a cashflow buffer or change their model if they are to continue using Amazon’s marketplace.

Amazon reportedly sent an email on Saturday saying: “We understand that the transition to this policy on 3 August has caused a one-time cash-flow issue for your business. To support you in preparing for the policy change, we have extended your policy transition until 31 January 2024”. This change of policy is still a further burden of small businesses who are already struggling with the  cost of living crisis, rising interest rates, increased energy bills, rising staff costs and higher import prices.

Solar built on landfill

In South Ockendon, East London, a massive solar panel farm has been built on top of a huge landfill the size of 28 football pitches. The project looks to make use of the land which was unusable for many other projects. The project will create 58.8 megawatts, enough for 17,000 homes.

Rail strikes

Deadlock is pushing train strikes through into late summer after the RMT announced a further two days of industrial action in its dispute over working conditions, job security and pay. The RMT union said Friday that 20,000 workers across 14 train operating companies will walk out on 26 August and 2 September.

Resilient economy makes rate rises more likely
Calum Muirhead in the Mail on Sunday warned of “more pain” for mortgage holders, with stronger-than-expected economic growth making further interest rate rises more likely. Office for National Statistics data shows that the economy grew by 0.5% in June after a 0.1% decline in May. Figures this week are expected to show that inflation eased to 6.5% in July from 7.9% in June. Despite falling, this remains well above the Bank of England’s 2% target. Mr Muirhead says the data means the Bank has more “wiggle room” to consider further rate rises in a bid to rein in consumer spending and bring down prices. Neil Birrell, chief investment officer at asset management firm Premier Miton, said: “The GDP data gives the Bank of England a headache. They may well have been thinking about pausing interest rate increases soon, but this data will make that more difficult.”

BoE risking a ‘policy induced recession’, says Haldane
Andy Haldane, former chief economist of the Bank of England, has warned that the economy is “stuck,” telling the Telegraph: “In growth terms, it’s been treading water for at least a year.” He adds that forecasts suggest “it seems set to remain largely stuck for the months and quarters ahead.” He says growth has been “anaemic” since the global financial crisis, while real pay has been largely unchanged “and unlikely to regain or surpass its global financial crisis heights for some while yet.” Reflecting on current Bank of England policy, Mr Haldane warns: “Given that growth starts around zero, it wouldn’t take very much to throw this economy into recession right now.” While he is hopeful that it can be avoided, he says: “If it were to come to pass … I think it’d be difficult to avoid the conclusion that that was a policy induced recession.”

Inflation puts mid-sized firms under pressure
A BDO survey of bosses at mid-sized firms shows that three in ten are considering pausing pay rises and scrapping bonuses to cope with the financial pressures, with many also considering downsizing or selling properties due to the impact of interest rate rises. BDO partner Richard Austin said: “The mounting pressures facing businesses in an inflationary and high interest-rate environment are not getting any easier to navigate. These businesses are the UK’s economic engine.”

Consumer confidence dips
Polling by the Centre for Economics and Business Research (CEBR) shows that consumer confidence slid for the second month in a row in July. The report shows that people have become more pessimistic about personal finances, house prices and the outlook for businesses. Kay Neufeld, head of forecasting at CEBR, believes that concerns about rising mortgage rates and wider housing cost pressures are likely to be behind the dip in confidence.

Landlords selling

A rise in tax proceeds indicates that UK Landlords have been selling off rental properties in greater numbers than previously estimated.  The amount of homes estimated from tax receipts, to have been sold by landlords rose to 25,000 between April and May from 22,000 calculated in February and March by Savills. HMRC has also revised upwards their estimates so the number of properties sold  in 2021/22 by 8.5% to 153,000.

Zuckerberg v Musk off

Mark Zuckerberg, has called off the proposed cage fight with Elon Musk.  Zuckerberg said he was “moving on” because Mr Musk wasn’t “serious” about the fight between the tech titans.

Britain’s corporation tax system needs a long-term fix
The FT says fixing the corporation tax system is “vital” to addressing “dire” productivity growth, warning that the current system constrains the dynamism and investment needed to boost long-term productivity and revenues.

Wage growth set to outpace inflation
Figures due this week are expected to show that wages are rising faster than prices for the first time in more than a year. Experts say average earnings excluding bonuses are expected to have risen by just over 7% in the year to June, while inflation is forecast to have fallen to around 6.8% in July.

Is the out of office era over?
The Observer’s James Tapper yesterday considered whether the shift toward remote and hybrid working is going into reverse, with Amazon issuing warnings to staff who are not spending at least three days a week in the office, Meta detailing plans for a similar policy and Zoom asking employees to attend for at least two days a week. Despite these employers calling for more frequent office attendance, research by the CIPD, the association of HR professionals, found that about 4m people – 12% of employees – have changed careers due to a lack of flexible working. Separate data shows that full-time employees in the UK work about 1.4 days a week at home on average. Mark Freebairn, a partner at executive search firm Odgers Berndtson, says bosses want to get workers into the office more often, commenting: “The chief executive community, the board community that I speak to – the majority would want more time in the office at the moment, and when one breaks cover and starts becoming more dictatorial about it, the rest will follow.”

Female FTSE 100 bosses narrow the pay gap
The pay gap between male and female bosses in the FTSE 100 narrowed last year, with the eight women leading the UK’s biggest listed firms earning an average of £4m compared to the £4.3m average for their male counterparts. The figures are far closer than the previous year, when the average for female FTSE 100 bosses was £3.7m compared to £4.7m for men. Overall, the average pay for a chief executive was £4.2m last year. GlaxoSmithKline’s Dame Emma Walmsley is the FTSE 100’s best-paid female chief, taking home £8.5m. This puts her among the top-20 highest paid bosses but is far lower than the £15.3m handed to Pascal Soriot, the chief of rival pharma group AstraZeneca and the FTSE 100’s top earning boss.

Wilko could be sold ‘within days’
Budget retailer Wilko, which this week collapsed into administration, could soon be snapped up, according to sources who say two rival discount chains and financial backers have expressed interest. With administrator PwC seeking a buyer, it has been reported that Hilco Capital, which invested £40m pounds in the business in January, will not be bidding. Meanwhile, insiders at rival chain Poundstretcher say it has “no interest whatsoever” in rescuing Wilko from administration.

Europe’s thriving businesses face mounting windfall tax hit
European governments are increasingly turning to windfall taxes, with data from KPMG and the Tax Foundation showing that more than 30 have been introduced or proposed since the start of 2022.

Latest Insolvencies

Appointment of Liquidators – TEEKAY FLOORING CO LIMITED
Appointment of Liquidators – DEREK WILLS TRAVEL LIMITED
Appointment of Administrator – ASPIRE PLATFORMS LTD
Appointment of Administrator – LTS POWERED ACCESS LIMITED
Appointment of Liquidators – THOMPSONS ENTERPRISES (1977) LIMITED
Appointment of Administrator – TRINITY SHADE LIMITED
Appointment of Administrator – TIME GB (DR) LTD
Appointment of Liquidators – OLDHAM PROPERTY LLP
Appointment of Liquidators – SJ MILLER LIMITED
Appointment of Administrator – HASTINGS & ROTHER CREDIT UNION LIMITED
Appointment of Liquidators – WINDRUSH LIMITED
Appointment of Liquidators – PITCHDESIGN LIMITED
Appointment of Liquidators – AV CONSULTING SERVICES LIMITED
Appointment of Liquidators – REPORTS 247 LIMITED
Appointment of Liquidators – CHEVRON PROPERTIES 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 seen many financial crises, this one will be particularly deadly for suppliers for some time to come.

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Unlike other credit management companies, we offer our members a fixed annual subscription regardless of how high the debt value maybe!

No face-to-face meeting required – just call Peter Uwins, CPA’s National Sales Manager, on 020 8846 0000 (business hours) or email 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 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!

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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.