Tag Archives: market matters

 

Supermarkets suffer the same problems as market traders – but on a grander scale. This includes underestimating how long it takes to generate turnover and profit sufficient to cover borrowings. We’ve all seen the enthusiastic but inexperienced start-up who lasts 6 months before the savings run out and he does a midnight flit leaving unpaid rent and suppliers behind. ‘Turnover is for egotists but profits are for realists’ is a classic saying – and a classic argument for cheaper bank loans and more tax breaks. Hopefully George Osborne will consider both now he doesn’t need to worry about re-election.

It took Aldi 25 years to generate enough turnover to become the UK’s sixth largest retailer

It took Aldi 25 years to generate enough turnover to become the UK’s sixth largest retailer. This was confirmed by first-quarter figures showing they’ve secured 5.3% of the retail grocery sector. That puts them ahead of Waitrose (a mere 5.1%) but still a long way short of Tesco at 28%. But every little helps.

What a pity they’re German, not British

At the same time Aldi announced ambitious expansion plans with another nine London stores in 2015 and a nationwide target of 1,000 by 2022. Contrast this with Tesco who ditched 40 + planned openings in the UK plus more abroad before posting a £6.4billion pre-tax loss. The fact that Aldi is both foreign and privately-owned simply rubs salt into the wound. It is not subject to corporate shareholder pressure for increased profits, year-on-year so could take it’s time to understand an overseas market. What a pity they’re German, not British.

It cost Tesco £1.2billion in write-offs when they pulled out in 2013

Asda retained their second place at 17% whilst Sainsbury held on at 16% but is suffering the same fall-out from overseas expansion that characterised Tesco under former Chief Executive Phillip Clarke. Tesco thought the best way to maintain turnover profits was overseas so launched their all-new ‘Fresh ’n Easy’ brand in blue collar USA. But they underestimated just how ‘mature’ US consumers are and that car workers in Detroit don’t understand self-service checkouts. It cost Tesco £1.2billion in write-offs when they pulled out in 2013.

Sainsbury’s venture into the unsophisticated retail economy of Egypt went dramatically wrong

Maybe Sainsbury’s new CEO, Mike Coupe should have considered this last year when he took over from long-standing predecessor Justin King. Sainsbury’s venture into the unsophisticated retail economy of Egypt went dramatically wrong when the Egyptian Courts charged JK with some (admittedly very dubious) allegations of embezzlement. Unfortunately Sainsbury had got into bed with a local developer who then went bust which cost them a modest £111million in write-offs after 18 months. But the ex-partner continued to pursue Sainsbury for alleged embezzlement so when Mike took over he travelled to Egypt to appeal against a guilty verdict. He very sensibly caught the return flight before the outcome of his appeal was announced which was just as well because he was sentenced to two years in Cairo Clink in his absence. There’ll be no more Egyptian sightseeing holidays for Mike unless he wants to do it in handcuffs.

This is not what one expects from a FTSE100 Company

The amazing thing is that investors learnt about this from the media, not from a Shareholder announcement. This is not what one expects from a FTSE100 Company and must rank alongside JK’s 2007 denial of Sainsbury colluding with suppliers to rig dairy product prices. Until two months later that is, when he announced a £26million out of court settlement with The Office of Fair Trading to avoid prosecution. Hmmm…….

Taking your eye off your home turf and forgetting what you do well may be a big mistake.

It seems the bigger you get the more confident you are that size alone will enable you to do a better job than the locals, even if you choose the right partner. Taking your eye off your home turf and forgetting what you do well may be a big mistake. Tom Jones (yes, THAT Tom Jones) was top of the bill in Las Vegas for 40 years before being offered a lucrative partnership in a new Hotel development. He’s no fool when it comes to business and turned it down, saying: ‘What do I know about running Hotels – I’m just a boy from the Valleys who can sing a bit’ which was not unusual.

The ‘Big Four’ Supermarkets are now faced with an inquiry by the Competition and Markets Authority

The fallout of all this is going to get worse says Begbies Traynor, the corporate insolvency practitioners. They suggest 1,400 wholesalers face imminent collapse as price wars escalate and buyers cut out the middlemen and deal direct with producers. After all, someone has to pay for the ‘£1 deals’. More worryingly they predict a bleaker picture still when Aldi and Lidl capture up to 20% of market share as predicted. They point out that: ‘The majority of Aldi and Lidl’s packaged stock is own-brand sourced from overseas, so struggling UK suppliers could find themselves squeezed even further’ – particularly if Sterling continues to strengthen whilst the Euro goes South. To add to Sainsbury problems the ‘Big Four’ Supermarkets are now faced with an inquiry by the Competition and Markets Authority (successor to the OFT and Competition Commission). This was triggered by a so-called ‘super complaint’ lodged by ‘Which?’ magazine alleging they systematically mislead shoppers by reducing pack sizes without reducing prices and make seasonal offers where the ‘previous higher price’ only applied out of season etc etc. I can’t help thinking this will only restate the bleeding obvious and result in a few adjustments to the Pricing guidelines and Groceries code of practice.

Mind you, a bit of adjudication in favour of shorter payment periods for suppliers would be welcome. Tell me about it.

 

Danny Alexander, Chief Secretary to the Treasury has announced a review of the business rates system and inviting contributions from all parties. Quarterbridge has made representations on behalf of market traders, stallholders and owners. We’ve highlighted inconsistencies in application and how recent changes have created an unnecessary administrative burden on councils.

When the rateable value is calculated it should, theoretically reflect periodic occupation and varying trader attendance from week to week.

The existing system of business rates is based on the estimated rental value of comparable premises which are occupied with exclusive possession by a tenant for 365 days per year. This rarely applies to markets – particularly open markets which don’t occupy a building and for which comparable evidence of rental value can rarely be found. When the rateable value is calculated it should, theoretically reflect periodic occupation and varying trader attendance from week to week. But in reality this does not happen and the market owner is left with a charge to recover through the rents he charges but which has very little relation to the true value of the space.

The administration is unnecessarily complex and in any event often worthless at collecting tax

The system is particularly inappropriate for market halls containing fixed stalls. Stallholders do enjoy ‘exclusive possession’ of their stalls 365 days per year but in recent years the Valuation Office has moved away from a ‘single assessment’ of a whole market hall to individual assessments of stalls within it. This is a retrograde step. Previously it was easy for management to query the assessment and apportion it back to stallholders pro rata to the space they occupy within the building. Nowadays the system requires the individual measurement of each stall and the creation of dozens of new rating accounts for a council to administer. There are also inconsistencies in application between regional valuation offices – sometimes the management facilities are charged in addition and sometimes they are apportioned into the stall assessments. The administration is unnecessarily complex and in any event often worthless at collecting tax because individual assessments fall into the band qualifying for small business rates relief.

Under the individual assessment scheme stallholders have to submit individual applications for small business rates relief

Under the individual assessment scheme stallholders have to submit individual applications for small business rates relief which creates yet another burden of administration for their local council. In practice many managers make the applications for relief on behalf of their stallholders to keep total occupational costs down and often end up supplying the VO with floor areas for the calculations. Turkeys don’t like voting for Christmas or doing someone else’s job.

Markets halls and open markets should be assessed on a ‘profits-generated’ basis

The Quarterbridge view is that simple-to-administer single assessments for market Halls should be used and both markets halls and open markets should be assessed on a ‘profits-generated’ basis at the financial year end, using trading accounts and online self-assessment. This will remove a whole raft of administrative costs and make the system fairer all round.

If you’d like to make your views known to HMG and see the terms of reference for the review, then go to http://www.ow.ly/LwMDy

Act now and have your say

Responses have to be received by 12th June which ain’t far away so get weaving.

 

The bookmakers odds for the May 7th general election are all over the place. The outcome looks the least predictable for decades now that coalition government and fixed-term parliaments have become the norm.

Turnout should be good though as more people tend to vote in a general election if the result is uncertain.

Depending on where you live you could have the choice of up to 12 mainstream parties to choose from: Conservative, Labour, Lib-Dem, SNP etc., plus up to 21 fringe parties such as the Yorkshire Devolution Party and CISTA – which sounds like an unpleasant personal infection. But if you live in the constituency of the Speaker of the House of Commons like wot I do then it’s much more boring. The mainstream guys have a gentlemans agreement not to field a competing candidate so we’ve only got the Greens and UKIP. And Nigel Farage isn’t the candidate here again as last time he had a nasty accident in an aeroplane.  Turnout should be good though as more people tend to vote in a general election if the result is uncertain. In 2001 a mere 59% of registered electors bothered to vote after Labour’s previous 1997 landslide win. In 2010 after the financial crisis the figure rose to 65% but not in central Manchester, Leeds or Birmingham where more than half still couldn’t be arsed to vote. Mind you that’s better than in Lithuania where only 37% turned-out for their last general election and a lot worse than in Australia where 94% did so. But in Oz it’s a legal obligation to do your civic duty and vote or you get fined £12 and thrown to the crocodiles.

 

If you’re feeling as interested as a Lithuanian but want to understand everyone’s policies and impress your mates down at the pub then go to the BBC’s excellent ‘policies at a glance’ website at http://www.bbc.co.uk/news/election/2015/manifesto-guide

‘Which county has created more jobs than the whole of France?..’

MP’s were waiting eagerly in March for the Chancellors pre-election budget. They expected a last-minute knock-down ‘Chancellors special’ but in the event came away disappointed. George Osborne sat back and rested on the Government laurels of the fastest growing post-recession economy in Europe. The Yorkshire Devolution Party (No MP’s, yet) was ecstatic when he announced ‘Which county has created more jobs than the whole of France? The great county of Yorkshire!’. George glossed-over the need to pay-down the governments £1.4 trillion of debt after the deficit has been sorted but did throw in a few morsels such as tax breaks for North Sea oil companies and reduced duty on beer and wine. The only real cheers were for fuel duty (no increase) and abolition of annual tax returns and national insurance contributions for the self-employed. Sadly, George didn’t lift the threshold for Vat registration and boost the ‘engine room of the economy’ as he calls small businesses.

The PM has announced plans for a ‘Northern powerhouse’

The government is definitely twitchy about accusations that a ‘Metropolitan elite’ is running the country and doing ‘nowt for the north’. To do something for marginal northern constituencies the PM has announced plans for a ‘Northern powerhouse’ fuelled by allowing Greater Manchester to keep 100% of the growth in local business rates and benefit from another high speed rail link – HS3. This would extend HS2 from Manchester and Leeds up to Newcastle, but quite how it can be financially-justified is another matter.

‘little more than a costly vanity project’ 

That has already been pointed out by the Commons Public Accounts Committee and the free-market think-tank the Institute of Economic Affairs. It’s spokesperson described it as ‘little more than a costly vanity project’ which is how Lord Mandelson has described it’s conception in the dying days of the last Labour administration.

The Small Business Rates Relief scheme is extended until 31st March 2016

Anyway, putting aside HS2’s unwelcome lack of a business case the government has moved to safer ground by confirming the Small Business Rates Relief scheme is extended until 31st March 2016. Most market businesses qualify for this waiver on rates payable so if you’re not already receiving it I strongly recommend you check with the rating office at your local council. If the rateable value of your premises is below £6,000 you’ll pay nothing at all and to encourage you to grow into bigger premises you’ll now receive the relief for 12 months after you occupy an additional property. This news was delivered at the same time as Danny Alexander, Chief Secretary to the Treasury announced a ‘radical review’ of the business rates system with its outcome to be announced in 2016. ‘The time has come for a radical review of this important tax. We want to ensure the system is fair, efficient and effective’ he said, which was nice to hear. But those of us with long memories will remember previous government attempts to reform the rating system have been torpedoed by the civil servants of the Valuation Office which employs lots of keen young surveyors to administer the system.

Just as exciting and unpredictable as the result of the general election was the result of this year’s Cheltenham Gold Cup.

Just as exciting and unpredictable as the result of the general election was the result of this year’s Cheltenham Gold Cup. Unfortunately my foolproof system to ‘Back the jockey – not the horse’ came unzipped, yet again. Tony McCoy and Carlingford Lough trundled in at ninth place whilst Nico de Boinville on Coneygree romped home to a well-deserved length and a half victory.

McCoy has announced he won’t be riding at Cheltenham again.  I can see a pattern emerging here.

 

 

Tesco’s plans to close 43 ‘Express’, ‘Home Plus’, ‘Metro’ and ‘Superstores’ by mid-April has been well publicised, as has their proposal to scrap another 49 NEW stores planned for the UK. The Company has also scrapped plans for 13 new stores in Hungary, but it’s not clear whether the sites will be ‘land banked’ as it’s called or sold-off, and if so on what terms.

He seemed oblivious to the relief of independent retailers in Bilston Market Hall and on the High Street and those locals who’ve stared at this derelict site for the last 14 years

The announcements provoked outcry amongst MP’s protesting at the effect on their constituencies. One of the most strident was Pat McFadden MP (Labour, Wolverhampton South East) indignant at Tesco’s decision to scrap development of the former Royal Hospital site in Wolverhampton. He seemed oblivious to the relief of independent retailers in Bilston Market Hall and on the High Street and those locals who’ve stared at this derelict site for the last 14 years. He proclaimed the news from Tesco was a ‘betrayal’ and proved the Company ‘could not be trusted’. No-one can accuse Pat of jumping to conclusions – he’d taken 14 years to work that out. Nor did the news have the earthshaking effect he’d hoped for amongst dispirited locals. No member of the Hungarian National Assembly was available for comment.

Provided your pockets are deep enough there is nothing to prevent you from buying premises ‘just in case’ and very little to prevent you from leaving it derelict thereafter

But Pat’s comments DID highlight a major flaw in the UK town planning system – how all supermarkets (not just Tesco) ‘land bank’ future development sites, then leave them derelict. This practice has been criticised by the Competition Commission as an underhand means of preventing competitors from expanding into their business – which is of course exactly the intention. Provided your pockets are deep enough there is nothing to prevent you from buying premises ‘just in case’ and very little to prevent you from leaving it derelict thereafter. Effective legislation to prevent land banking does not exist so supermarkets and housebuilders continue to buy-up sites as soon as a new Local Plan is released which zones areas for future development. As the Commission has pointed out, if a developer can snap them up quickly and on the cheap – often by an initial payment plus top-up bonus once it is built-out – then that effectively blocks the competition. Between purchase and build-out the planning authority is largely powerless to prevent the site being left derelict and has to tell anyone applying for a similar use: ‘Sorry – there’s another site already allocated for that use’. That’s why draft Local Plans generate so much interest from developers.

There has been talk about forcing developers to relinquish land-banked sites under threat of Compulsory Purchase Order, or forcing them to put the land to ‘beneficial use’ – but who will pay for it?

This problem has not been helped by the Dept. for Communities and Local Government (DCLG’s) shiny new National Planning Policy Framework (NPPF) introduced in 2012. Secretary of State for Communities and Local Government, Eric Pickles MP (Conservative, Brentwood & Ongar) has been widely-criticised for replacing 1500 pages of national planning policy built-up over 40 years with 50 pages devised in 40 months. The new slimline NPPF is accused of being far too pro-development and lacking a means to counter land-banking – frustrating local planning authority efforts to phase development to a rational programme. There has been talk about forcing developers to relinquish land-banked sites under threat of Compulsory Purchase Order, or forcing them to put the land to ‘beneficial use’ – but who will pay for it? Not local government for sure. To compound the problem local planning authorities are under pressure to meet DCLG targets for more homes for our expanding population. Landbanking means green fields are often built-out It will be interesting to see whether Tesco hold onto or sell-off their cancelled development sites. Councillor Roger Lawrence, leader of Wolverhampton City Council, said: ‘The Council has done everything it its power to support Tesco to proceed with their plans, and I and senior council officers will now be seeking urgent discussion with Tesco about how to take forward the development of this key gateway site.’ Well, unless Wolverhampton CC make some outrageously expensive taxpayer-funded concession there’s not a lot they can do to force Tesco into action. And if Tesco do sell-off then you can bet they’ll slap a restrictive covenant on the title deeds to frustrate any competitor from acquiring the site in the future.

A 23% drop in Waitrose operating profits has meant bonuses have been cut for the second consecutive year

Another group which is far from happy are the 94,000 staff who own John Lewis and Waitrose. Traditionally some 45 – 50% of trading profits have been paid-out as bonuses to the ‘partners’ each year but a 23% drop in Waitrose operating profits has meant bonuses have been cut for the second consecutive year, from 15% to 11% of annual salary. This was despite the upmarket grocer increasing like-for-like sales by 1.4% and gaining market share against its rivals. The boss of Waitrose, Mark Price, said the Company is battling against shoppers ‘moving away from a single, weekly out-of-town shop to multiple smaller purchases from convenience stores and online’.

Tesco is trying to rebuild its fraught relationship with suppliers.

Finally, after it’s £260 million false-accounting scandal (booking ‘supplier discounts’ before receipt) Tesco is trying to rebuild its fraught relationship with suppliers. The Company is waving the magic wand of a friendly online Tesco Supplier Network to help 5,000 suppliers communicate with their Buyers and each other – complaints included. Given their rough treatment of suppliers in the past the rumour has it few are likely to let bygones be bygones. The magic wand is seen as a big stick in disguise.

 

 

The start of 2015 saw a very old saying amongst stockbrokers come true: ‘Sell your shares in any company when it buys a company jet or builds a new headquarters’ they say. Companies lose touch with reality as they get bigger and one person who seems to agree is ‘Drastic Dave’ Lewis, the new Chief Exec. of Tesco. He announced the closure of both their Cheshunt HQ and Kansas Transportation Ltd, the Company subsidiary which discreetly operates a fleet of 5 executive jets.

From now on it’s RyanAir only for Tesco directors as they struggle against falling sales and a £260 million accounting scandal

This must come as a disappointment to former CEO Phillip Clarke (currently under investigation by the Serious Fraud Office). It limits the possibility of doing a flit in the £31 million Gulfstream jet delivered last month as part of the £29m cost of flying executives around the world 2005-2012. From now on it’s RyanAir only for Tesco directors as they struggle against falling sales and a £260 million accounting scandal. And now we know who owns all those private jets parked at Luton airport.

The good people of Cheshunt, home to Tesco’s ugly concrete HQ since 1973 were also less than happy about job losses and a move for remaining staff to Welwyn Garden City. ‘I can’t believe it’ Ward Councillor Mike Iszatt told the ‘Hertfordshire Mercury’. ‘I don’t know why they want to move out of the Borough – it’s so convenient for their employees next to the station and we’ve got crossrail coming in the near future. I hope they will reassess their decision’.

The international credit rating agency Moody’s downgraded Tesco’s credit rating to ‘junk’

Apart from that, Drastic Dave suspended yet a ninth executive – Chris Robinson, finance director at food sourcing – and confirmed the closure of the defined benefit pension scheme for staff, 43 convenience stores and cancellation of 49 new store developments. Stockbrokers seemed mildly pleased and shares rose to £2.20, still less than half their pre-scandal level. Nevertheless the international credit rating agency Moody’s downgraded Tesco’s credit rating to ‘junk’, saying “structural changes in the UK grocery retail market will continue to challenge the Company’s operating performance”. Whether that enables suppliers to demand better terms from the retailer is unclear.

The announcement of a new ‘Retail Ombudsman’ has been greeted with mixed feelings

The ‘Kipper season’ is now upon us. It’s always a good time for everyone to have a moan so the announcement of a new ‘Retail Ombudsman’ has been greeted with mixed feelings. The response to this ‘new independent service to resolve disputes with supermarkets, high street brands and online retailers’ has been less then overwhelming. Like several other Ombudsman services it lacks teeth as it is unofficial i.e. not established or vetted by Parliament. Its adjudications are not binding on anyone unless they happen to subscribe to it, but if you do and it does find in your favour don’t feel too smug – the complainant can still take you to court.

So why establish a toothless Ombudsman?

So why establish a toothless Ombudsman? Apparently this is a mainstream retail response to the forthcoming EU ‘Alternative Dispute Resolution directive’ which will take effect in July. This says the retail sector must have an ‘Alternative dispute resolution body’ – but Parliament has already decided the new watchdog must be official i.e. vetted by the Trading Standards Institute. So whilst toothless in the interim it may morph into that in due course but the meantime is funded by subscriptions from 3,000 or so retailers who have signed-up to it. You can offer it as part of your Customer Care Charter which is one way to take pressure off your Customer complaints department. Especially if you run the notorious ‘No-help-whatsoever-desk’ at RyanAir which has an annoying habit of emailing an apology to your mobile and not accepting replies.

Although the new Retail Ombudsman may be a bit of a crock in terms of Consumer protection it’s a different thing if the Ombudsman is regulated e.g. for energy, financial advice, mortgages, insurance and savings. If you receive or want to make a complaint then go to http://www.ombudsmanassociation.org to see if there is a relevant ombudsman and if its findings are binding.

 

 

 

Meanwhile suitably-barmy advocates of ‘Workplace Wellness’ in the USA are hoping 2015 will be the year that ‘Standup Desks’ take off. These have been favoured by great minds such as Leonardo da Vinci and of course Michael O’Leary, the Chief Exec. of RyanAir. He once suggested RyanAir were considering ‘standing-only’ spaces on their flights and charging people to use the loo. Despite criticism from the Guild of Chairmakers, Joe Nafziger, the Californian inventor of Standup desks said “It’s definitely a worldwide thing that’s picking up speed”.

Advocates of ‘Workplace Wellness’ in the USA are hoping 2015 will be the year that ‘Standup Desks’ take off

Joe would love to hear your opinion of whether standing behind a stall all day in January is good for your health.

Whistleblower

Some years ago a mate of mine was Sales director of an Engineering Company in the Midlands. The Company had grown off the back of supplying ‘gondola’ display racking to supermarkets. A big roll of galvanised steel went into one end of their factory and lots of uprights and shelves came out the other. Supermarkets were expanding like crazy and he’d shaved the margins when bidding for a mega-deal for 10 miles of racking for 40 new stores. He was understandably delighted to be invited to a contract-signing at a certain Supermarket’s head office but when shown into the boardroom found several competitors sitting at the table, all looking very hacked-off. Then in walked the Supermarket Head of Procurement who announced they would each be given an office, a telephone and one hour to reconsider their price. This was not a nice way to be treated. He lost the contract and his Company had too many eggs in one basket so went belly-up a couple of years later. Lesson learnt – the hard way.

Half-year profit forecasts to investors were being overstated by some £250m.

Quite a lot of hard-done-by suppliers may be taking quiet pleasure from Tesco’s problems at the moment – well the ones who can find another customer anyway. Back in September a whistleblower in Tesco’s finance department thought the new Chief Executive, Dave Lewis should be told that half-year profit forecasts to investors were being overstated by some £250m. When this profit warning was announced the institutional shareholders reacted in horror and the share price plunged. If you can’t trust the published accounts of a FTSE 100 Company then who can you trust? An internal enquiry was launched, payments withheld to former executives and others politely asked to step aside. Tesco has now handed the results to the Financial Conduct Authority amidst allegations that a small group of people in Britain’s biggest retailer deliberately misled its auditors to boost the trading accounts.

Tesco also confirmed withholding pay-outs worth millions of pounds to former Chief Executive Philip Clarke and former chief financial officer Laurie Mcilwee. The Serious Fraud Office is taking a keen interest and Tesco could face ‘significant fines’ and claims from investors says Mr Lewis. He is also wondering why he answered that job advertisement.

Screwing your suppliers is standard practice for any supermarket but Tesco seems to have refined the art. The allegation is they credited ‘product supplier discounts’ to an earlier accounting period than when actually received. This is naughty and contrary to the Groceries Supply Code of Practice as well as proper accounting standards. You can get away with it if sales turnover is rising and increased revenue in the next period cloaks it – but not if sales turnover is falling which is what’s happening at Tesco. These ‘discounts’ are demanded by Supermarkets in return for the retailer placing the suppliers product on the best shelf. ‘Eye line is buy line’ and all that – a bit like paying key money to get the best pitch next to your Market entrance.

Tesco’s share of the UK groceries and household goods market share has fallen from over 30% to 28%.

This little accounting irregularity is the icing on the cake for Tesco. Sales have been falling for several quarters largely due to German discounters Aldi and Lidl. Tesco’s share of the UK groceries and household goods market share has fallen from over 30% to 28% and the share price was already on the slide before this announcement. Chiselling £250 million or so out of your suppliers every 3 months is no mean feat but it seems likely someone told the auditors the discounts were already in the bank, not an anticipated receipt. Tesco shares which were nudging £5 a couple of years ago now stand at under £2.

So it looks like our Dave may need to raise cash to pay a hefty fine and reimburse shareholders who bought-in on fraudulent figures. Someone may even do porridge. Dave has now penned a long apology to Tesco Suppliers which looked good in the press and stopped them looking round for other retail outlets. It also softened them up for the next round of supply negotiations which are bound to follow. He might have to sell-off of an asset or two such as Tesco Banking or a juicy overseas operation. Cost-cutting in the UK such as a halt on new store openings had already been implemented by his predecessor Philip Clarke who switched to store refitting with posh coffee shops, restaurants and digital businesses. And falling sales.

Dave Lewis says he is a fan of ‘brand archaeology’ i.e. returning Tesco to its original roots. That sounds like he’ll focus on becoming Britain’s cheapest retailer once more and taking-on Aldi and Lidl. It’s the suppliers I feel sorry for.

Meanwhile the 5-yearly commercial property revaluation used to calculate business rates has been postponed yet again.

The last revaluation was due in 2013 but HM Government postponed it until 2015 claiming it would cause ‘uncertainty for businesses’. It’s now been postponed yet again until 2017 i.e. after the next election and assessments continue to apply based on pre-2010 rental values. The total revenue ‘take’ collected by the Treasury is supposed to remain the same but because many High Street businesses have collapsed thanks to online shopping etc the burden is going to fall on those that remain. The British Retail Consortium has kicked-off big time about the effect on their Supermarket members and the PM has promised a long-overdue review of this archaic system. To do so he’ll have to fight his way past all the HMRC District Valuers. Good luck.

In the meantime as a ‘Small Business’ which occupies only one premises you’ll hopefully remain clear of liability thanks to the Small Business Rates Relief Scheme. But this is due to expire in March 2015. It will be interesting to see if Chancellor George Osborne extends that to 2017. He’s bound to – isn’t he?

Happy Christmas!

News-Indoor market hall main image 1024 pix

Identifying new lines is more important than ever nowadays whilst the wholesale industry continues to shrink as Supermarket Buyers bypass it and source product direct from the producers.

It’s that time of year when every Market business should be buying-in product for the New Year. All successful retailers rely on their Buyers to source new product and ‘refresh their offer’ on a regular basis and that means up to 12 months in advance. Identifying new lines is more important than ever nowadays whilst the wholesale industry continues to shrink as Supermarket Buyers bypass it and source product direct from the producers. Short shelf-life products to which you can add value by processing are less problematical than products where you’re reliant on what the wholesaler has in stock. Nowadays it is becoming more and more difficult to differentiate yourself from the competition and maintain a margin over the bulk discounters. Some new thinking may be overdue.

How about a romantic weekend break to visit some European Markets? There are excellent value Citybreak deals on offer from Easyjet and Wizzair to places like Krakow, Budapest and Barcelona. Take a long weekend to see what their Markets are selling and talk to the Traders. They almost always speak English and have a keen interest in what’s happening in the UK. Maybe you fancy opening a Polski Sklep or stocking-up with the seasonal goods seen on Budapest’s Christmas Market on Vorosmarty Square. Sourcing from abroad can still be profitable from countries like Poland and Hungary which have had the good sense to remain outside the Eurozone. My favourite is Budapest whose Central Market Hall offers a wonderful range of handicrafts, clothing and food all year round. It’s big and busy and at this time of year you can buy a live Carp to keep in your bath and fatten-up for Christmas, or a bushel of locally-picked wild mushrooms.

Foraging for wild mushrooms in the Autumn is a popular tradition in Central Europe – a bit like Elvering in Gloucestershire. But whether it’s Hungary or England you need proper instruction to identify the species before you wolf them down. Otherwise when you go down to the woods today you might have a very VERY big surprise. Ask Nicholas Evans, the best-selling author of ‘The Horse Whisperer’ who ended up having a kidney transplant and putting several members of his family on kidney dialysis. The police also take a keen interest in the cultivation of certain types (say no more) so there’s not mushroom for mistakes.

There are some 2000 species of mushroom in the UK of which 200 are delicious, 300 are very VERY bad for you while Scientists admit 1500 are ‘don’t knows’.

Information is available at various sites like www.foragingguide.com and www.rogersmushrooms.com but they have VERY big disclaimers and recommend you always put an uncooked sample to one side to help your hospital diagnose the problem.

We see a noticeable increase in poisoning cases as it is not always easy to differentiate between toxic and non-toxic species.

As the trend for organic, home-grown food has caught on many people have started foraging in their local woods for edible varieties. Dr John Thompson, director of the National Poisons Information Service in Cardiff has warned of the potential dangers involved: ‘At this time of year we see a noticeable increase in poisoning cases as it is not always easy to differentiate between toxic and non-toxic species – even for people with experience in foraging’. He sounds like a real fungi to sit next to at a dinner party. Celebrity Chefs like Hugh Fearnley-Whittingstall have been banging-on about organic delicacies such as field mushrooms for years but it’s noticeable that survival experts like Ray Mears and Bear Grylls have steered clear. Maybe they’ve been warned-off by their public liability insurers after the 237 recorded cases of poisoning in 2013, many amongst children. This year’s wet August and mild Autumn seems likely to result in a bumper crop and the Government Public Health Service has issued a warning after recording some 100 cases of poisoning in September alone.

European countries are much better organised to cope than the UK. In Budapest you’re obliged to present your mushrooms to an official ‘Mushroom Inspector’ stationed in a kiosk on the Market who then either approves them for sale or confiscates them before you can serve them up to your mother-in-law.

But of course Chefs love to use fresh mushrooms in their recipes all the time, not just in the harvesting season. So the French invented the ‘Champignon de Paris’ – an edible species grown all year round by ‘Champignonnieres’ in abandoned limestone quarries under the City suburbs. A couple still operate today but the wholesale trade has come to rely on the tasteless ‘button’ mushroom grown in so-called mushroom farms. Fortunately new exotic species like Shiitake and Inoki are also now in production and they taste excellent but also look similar to some wild nasties. Industrial production has at least reduced the risk of playing mushroom roulette.

I’ve not yet seen an official Mushroom Inspector on a UK Market but thanks to climate change they may arrive soon. In the meantime I suggest you restrict yourself to foraging for fresh field mushrooms and cooking them with bacon. I found some real beauties when out walking my dogs this morning and they tasted delicious.

See you next month. Maybe.

News-Market walk artist impression

The £4 million project forms part of wider Town Centre improvements by the Borough Council.

Councillors had a first glimpse of the new Covered Market in Woking earlier this month. The £4 million project forms part of wider Town Centre improvements by the Borough Council which include refurbishing the 1970’s Wolsey Place Shopping Centre and repaving Commercial Way, the retail heart of Woking.

The new covered Market Walk replaces the existing Open Market on Victoria Way due to be replaced with a new Hotel, Offices and Apartments as part of the improvements, but Councillors have promised existing Traders the current Market will remain open for Christmas trading.

Councillors were shown around by Council Officers and Quarterbridge who designed the new facility in conjunction with Benoy Architects. Quarterbridge is also providing interim management services through a new operating Company, Woking Market Ltd.

A new mezzanine floor was installed to create for backup storage accessed directly off the Shopping centre’s service yard.

The new Market has been built in the double-height walkway previously separating Wolsey Place from the adjacent Peacocks Shopping Centre. A new mezzanine floor was installed to create backup storage accessed directly off the Shopping centre’s service yard. It is equipped with coldrooms for fresh food uses and ambient storage cages for others. The ground floor walkway beneath has been repaved and 15 lockup kiosks provided, ranging from 750 to 1800 sq ft. Two of these are fully-equipped for catering with designated seating areas and three others fitted-out with fridges and display counters for a Butcher, Delicatessen and Fishmonger. The remainder are equipped with lighting, heating and standing-out display areas for greengrocery, florists and fashion sales.

15 lockup kiosks provided, ranging from 750 to 1800 sq ft.

Hayden Ferriby, Lettings Director for Quarterbridge said: ‘Demand for the kiosks has been excellent – too much in fact, but that’s a nice problem to have. It’s still a Market offering low-cost premises for Stallholders and excellent value for Shoppers. This investment will strengthen and diversify the town centre’s retail offer and help Stallholders keep pace with the multiples’.

Market Walk will trade 7-days per week and include a further 7 demountable daystalls for ‘casual’ traders in addition to the monthly Farmers and Specialist Market on Jubilee Square. Traders facilities are a vast improvement and include on-site preparation rooms, WC’s, data cabling and a state-of-the-art ‘Mood ceiling’ with background lighting which changes colour!

Quarterbridge lettings can be contacted on 01206 761000 or via their website: www.quarterbridge.co.uk

Piedwagtail

Tesco applied for a licence to shoot it, at which point TV ‘SpringWatch’ presenter Chris Packham suggested there was a better way.

Pied Wagtails and Tesco don’t mix – just like Seagulls and Open Markets. Last month the Supermarket chain was forced to rethink plans to shoot a bird flying around it’s Great Yarmouth store. It evaded capture for several weeks before Tesco applied for a licence to shoot it, at which point TV ‘SpringWatch’ presenter Chris Packham suggested there was a better way. He Tweeted on Twitter (nice one) that the British Trust for Ornithology would be able to capture and release it. Tesco agreed to look at the alternatives but since then it has all gone very quiet and the bird has not been available for comment.

Zombie Seagulls have become a real problem and trade is suffering as a result.

Tesco’s Wagtail problem is nothing compared to the Seagull nuisance on some Open Markets. I’ve visited several this year where Zombie Seagulls have become a real problem and trade is suffering as a result. Clothing displays have to be kept under cover to avoid ‘fouling from above’ and fresh food traders have cleared-off because of the hygiene issues. Shoppers are assaulted and the Market has shrunk in size as a result. If anyone suggests they should be culled (the Seagulls that is, not the Traders) the tree-huggers come out of the woods and the press have a field day.

And it’s not just a problem for Markets – Hoteliers are increasingly fending-off complaints from guests woken by the 4.00am dawn chorus. Truro is a lovely place to stay but try finding a quiet hotel room in the summer – the squawking sounds like your first spouse and in-laws at Christmas.

It’s an offence to disturb or harm any birds or eggs, or their nests when in use.

The problem is partly-created by the Wildlife and Countryside Act 198 which makes it an offence to disturb or harm any birds or eggs, or their nests when in use. Traders, Shopkeepers and Hoteliers who try to shift the problem onto their local Council often find the Act used as an excuse for inaction whilst in reality the problem is money – who should pay to solve the problem? Perhaps building owners should be more responsible and put netting over their roofs – or takeaway food outlets be reduced in number to reduce public ‘grazing’ and refuse? It has all got very political since dustbins were replaced by refuse bags and takeaway outlets have multiplied. UK Seagull numbers are on the increase whilst in Europe numbers they are falling. This is largely due to the Italians shooting anything which flies and the French eating whatever remains. Seagulls are remarkably intelligent beasties and have flown over to Scarborough, Rhyl and Swansea instead.

The Act does make provision for control measures in the event of a ‘nuisance or risk to Health & Safety’ and anyone can apply for a licence to control numbers. Just like Tesco, British Aerospace at Warton aerodrome applied for a licence to cull seagulls on the nearby Ribble estuary – home to thousands of pairs which cause damage to their aircraft. In response the RSPB lodged (and lost) an appeal to the High Court which cost them £100,000 in legal fees.

‘Predator control’ was invented 150 years ago by the Duke of Wellington when the Crystal Palace became infested with sparrows.

If someone finds the money then various control measures are available: Prevention (netting and anti-roosting spikes) are expensive but shooting is hit and miss (sorry about the pun). ‘Predator control’ was invented 150 years ago by the Duke of Wellington when the Crystal Palace became infested with sparrows. Ken Livingstone and the GLA tried this again in the ‘80’s and treated Londoners to the sight of pigeons being ripped apart whilst still alive on the pavements of Trafalgar Square. This was not good PR. Nottingham and Norwich Councils have tried that as well and although the tourists objected some locals apparently enjoyed it as a good substitute for fox-hunting.

A discrete industry has now grown up to control seagulls and pigeons, but it’s not cheap. If you have a problem then your Market Authority will not like the cost. The most humane method is to coat the eggs with oil whilst still in the nest or replace them with plastic ones. Mummy seagull continues to sit quietly on them but they never hatch – then after she’s cleared off you remove the nest and put up a net to stop her returning next year. But please NEVER allow a Market Manager loose with a permit and an air rifle after hours. He’ll cause more damage to buildings then the birds.

Some birds are still welcome on Markets – Parrots for instance. They’re noisy and good-natured but do tend to argue with the Manager. A lot like Traders. Who’s a pretty boy now then?