Making The News This Week – 21 April 2017
This is your weekly round-up of news from the media which impacts on the independent retail sector.
Shops may close free cash machines after court defeat
Concerns are mounting over the future of free cash machines after a legal ruling upheld a decision in 2013 that ATMs built into the front of a store should have a separate business rates bill, revealed the i.
The ruling has dashed retailers’ hopes of clawing back £200 million in rebates for past rates paid, and they also now face a £206 million bill for the next five years under the recent rates revaluation. This has raised fears that small shops and independent petrol stations may be forced to close cash machines or start charging for usage.
Rents and rates specialist CVS found that rates increases from April 1 are costing retailers nearly £2,800 on average for each ATM.
The number of machines liable for business rates has risen from 3,140 in 2010 to 14,068 this year.
George Osborne QUITS as MP ‘for now’ to focus on Evening Standard role
All media advised that George Osborne was quitting as an MP in order to focus on his new role as editor of the Evening Standard newspaper.
The former chancellor will leave the House of Commons next month, following the Prime Minister’s decision to call a snap vote on June 8, with Osborne revealing he will not re-contest his Tatton seat.
Osborne attracted fierce criticism for accepting the editorship of London’s Evening Standard while originally stating his intention to remain as an MP for his constituency in Cheshire.
The Tory MP added the newspaper role to a string of highly-paid jobs he has taken on since being forced out of the Treasury in the wake of last year’s Brexit vote.
Head of Britain’s biggest cash and carry questions Tesco tie-up plan
The boss of Bestway, the UK’s largest cash and carry group, has raised fresh doubts about Tesco’s £3.7 billion merger with Booker by highlighting that the latter’s corner shop owners are obligated to buy two thirds of their produce from the wholesaler, revealed the Daily Telegraph.
The paper said that Tesco chief executive Dave Lewis recently attempted to downplay competition concerns by arguing that shopkeepers who run Premier, Londis, Budgens or Happy Shopper stores were free to source goods from other cash and carry groups. “It is a very competitive market, and they have the freedom to shop around,” Lewis said.
Booker and Tesco have also tried to argue that the deal does not “add more stores” because the wholesaler operates a franchise model for its retail chains.
However, the Telegraph said it understood that Booker expects Premier shop owners to buy two thirds of goods from it as part of a contract that comes with having the symbol group’s name above the door.
Martin Race, Bestway’s managing director said there were “buy-out agreements which limit the amount a shop can buy from other wholesalers”. As a result, Booker had “an obvious level of influence” over its network of 5,000 independent shop owners.
Race said the Tesco takeover would be ‘painful’ for the rest of the convenience sector and would lead to more consolidation.
His comments followed criticism from Nisa boss Nick Read who said that the deal would create “enormous fallout” and Morrisons chairman Andy Higginson who stated that the competition watchdog should scrutinise the deal.
“The main concern is for customers that have spent the last 40 years fighting against the big multiples and supermarkets, and now two of the biggest are coming together”, said Race. “It will put an enormous amount of pressure on the sector.”
Racist yob spits in shopkeeper’s face because she told him she didn’t have his favourite cigarettes
A racist yob spat in the face of a female shopkeeper after she told him they did not have his favourite cigarettes in stock, reported the Daily Mirror.
CCTV footage captured vile Christopher Callaghan as he abused shop staff in Bootle before spitting over the counter at a Sri-Lankan-born woman working there. Disgusted by his reaction, the woman threw an item from the counter at him – before grabbing a charity collection tin in a bid to chase him out of the shop.
Callaghan, 30, flew into a rage when he was told by staff at Stanley Foods they did not stock his preferred brand of cigarettes. After Nilani Nilalarajah opened the counter to prove to him that the cigarettes were unavailable, the “aggressive nuisance” hurled vile abuse at her and then spat in her face.
At Sefton Magistrates Court Callaghan pleaded guilty to racially aggravated common assault in relation to the spitting incident, which took place on October 10 last year. He also admitted a racially aggravated offence in relation to a previous incident in the shop, when he hurled racist abuse at the Nilalarajah. Callaghan was jailed for 16 weeks, suspended for two years.
District judge Miriam Shelvey ordered him to spend 35 days of supervision with the probation service, and to pay his victim £250. The judge also upheld a restraining order which forbids Callaghan from contacting the shop worker.
Aksha Shahid, senior district crown prosecutor with the CPS, praised Nilalarajah for being brave enough to come forward and report the offence.
She said: “This was a disgusting assault on a woman who was simply doing her job and providing a vital service to the local community. Callaghan was known to be an aggressive nuisance in the shop and he has now been sentenced by the courts for behaviour that will not be tolerated.
“The victim was badly shaken up by the ordeal but supported the prosecution and I’d like to thank her for her courage in coming forward and reporting the incident. We hope this case gives others the courage to come forward and report this type of despicable behaviour.”
Met Commissioner pledges five-year war on violence
Giving her first interview to the Evening Standard, the new commissioner of the Metropolitan Police Cressida Dick pledged to spend the next five years reducing violence and targeting gun and knife crime in London.
She promised an “end to end” approach to tackle crime with a tough crackdown on violent criminals: “I want to bear down on violent crime, in all its aspects but definitely knife and gun crime particularly… You have to prevent people getting involved.”
Rising prices put the squeeze on business
According to analysis by insolvency firm Begbies Traynor published in The Times nearly 22,000 companies are facing ‘significant’ financial distress because of rising prices.
It predicts a serious squeeze for businesses, saying it is “only a matter of time” before businesses faced with inflation and the weaker pound passed the costs on to customers.
Fifth of British businesses hacked by cyber criminals
Sky News was the first to report on a survey by the British Chambers of Commerce which found that 18 per cent of smaller companies had experienced some form of cyber-crime in the last 12 months.
Just 24 per cent of all the businesses polled said they had security measures in place against hacking.
A government spokesman said: “It’s essential businesses take responsibility for their cyber-security risks and we urge them to take advantage of our free advice, online training and Cyber Essentials scheme to protect against attacks.”
Meanwhile, an Ipsos Mori poll published in the Daily Mail showed that hackers attacked around 46 per cent of companies in the past year.
The most common attacks came via fraudulent emails claiming to be from a trusted source such as HMRC. Nearly a fifth of firms that were hit suffered ‘ransomware’ attacks, where criminals lock down a computer system with a virus and demand cash to unlock it.
Security breaches in the past 12 months cost small companies £1,380, the survey found.
Claran Martin, head of the government run National Cyber Security centre, said: “UK businesses must treat cyber-security as a top priority.”
Seven men jailed for total of 92 years for ATM explosion raids
Seven men who caused explosions at cash machines around England and Scotland have been jailed for a total of 92 years, reported the Guardian.
The group stole more than £550,000 and caused more than £160,000 worth of damage in attacks on ATMs at 13 banks and supermarkets, Merseyside police said.
The group, from the Merseyside area, were caught after a 12-month police investigation conducted by Titan, the north-west regional organised crime unit.
DCS Chris Green, the head of Titan, said: “These seven individuals believed they were untouchable and they used dangerous tactics in targeting ATMs which clearly put members of the public at risk.”
After a police operation on 28 June 2016, the men were charged with conspiracy to cause an explosion and all, except one, were also charged with conspiracy to commit burglary.
The ATM attacks happened in Merseyside, Cheshire, Berkshire, Gloucestershire, and Suffolk in England, and Aberdeen, Perth and Carnoustie in Scotland in 2015 and 2016.
Sentences ranging from life to 11 years in prison were handed out at Liverpool crown court yesterday (Thursday).
Sajid Javid faces backlash after saying redrawing business rates to tackle online giants isn’t ‘priority’
Sajid Javid faces a huge backlash after saying that redrawing business rates to tackle online giants such as Amazon isn’t a “high priority”, advised the Sun.
The communities secretary told MPs it could be another FIVE YEARS before any proposals to even the playing field between the likes of Amazon and high street stores are drawn up by the government.
The incredible confession came just weeks after ministers were humiliated by figures revealing Amazon’s business rate bill for its distribution centres will fall this year while pubs and small shops suffer eye-watering hikes.
Speaking to a cross-party Commons committee, Javid said: “These issues of online-offline, in town-out of town it is not something that is the highest priority issue at the moment.”
He insisted small firms were more worried about the government fulfilling promises to carry out more frequent revaluations of business rates.
Lucozade sparks fury after changing its recipe to contain less sugar
Lucozade sparked a furious Twitter backlash after changing its recipe to contain less sugar, wrote the Sun.
Angry customers vented their fury on social media after the company announced it was cutting back on 50 per cent of the sugar in its drinks.
Talia Stewart tweeted: “I’ve literally drank Lucozade orange everyday for as long as I can remember, this change in recipe is a personal attack”, while Jake posted: “You’ve ruined Lucozade original – there is no greater crime.”
A spokesperson for Lucozade Ribena Suntory said they changed the recipe in November last year as part of a “far-reaching health and wellbeing plan”.
He added: “Removing 50 per cent of the sugar from our drinks was part of this plan, and this decision was motivated by consumer demand for great-tasting drinks with less sugar.”
So much for the new indestructible fivers
A five pound note missing a key security feature sparked warning that fakes were in circulation, wrote the Daily Mail.
But it seems the new plastic fivers are not as indestructible as first claimed, after police came across notes that appeared to be without a foil image of Big Ben. However, the Bank of England later ruled the notes were genuine but appear to be have been subject to extreme treatment.
A spokesman said: “The Bank of England is aware that a small number of polymer £5 notes have been damaged due to extreme use, for example prolonged washing at high temperatures. These notes are damaged genuine bank notes not counterfeits, and a lot of other security features remain intact.”
Magnum and Ben & Jerry’s helps Unilever beat sales forecasts after fending off Kraft Heinz takeover
Unilever reported quarterly sales growth that beat estimates and affirmed its outlook for the year in its first results announcement since rebuffing a takeover approach from Kraft Heinz, advised the Independent.
Underlying sales rose 2.9 per cent in the first quarter, the maker of Dove soap and Magnum ice cream said yesterday (Thursday), compared with the 1.9 per cent median estimate of analysts surveyed by Bloomberg. Growth accelerated from 2.2 per cent in the fourth quarter.
The company cited gains in its home- and personal-care businesses, while sales were unchanged in the food division. The ice-cream unit was helped by new products such as chocolate-coated Magnum pints in a tub.
The Cadbury robots making your Easter Eggs
Cadbury has hailed a £75 million investment at its Bournville factory as crucial to securing the future of chocolate in its historic home, said the Daily Mail.
The firm has installed hi-tech machines making millions of blocks of chocolate each day, and robots to put bars into boxes.
However, Cadbury needs need fewer people to operate them, warned the Mail, adding that a team of 28 people has been shrunk to just seven, while the amount of chocolate going through the machines has doubled from three to six tons an hour.
Shoppers splurge in Easter bounce
Retailers enjoyed an Easter bounce as consumers splashed out more over the weekend than last year, reported the Daily Telegraph.
According to Barclaycard, in-store sales rose by 14 per cent year-on-year on Good Friday and Saturday. However, online retailers continued to increase their market share at the expense of the high street, with internet purchase volumes rising by 26 per cent compared with the previous year.
“A comparatively milder and later holiday weekend prompted consumers to make more purchases, although a smaller rise in transaction values suggests part of the appeal can be attributed to the discounting seen across the high street”, said Paul Lockstone, managing director at Barclaycard.
Chewing gum firms must pay out to clean up streets, say councils
Chewing gum manufacturers are facing fresh demands to help pay the multi-million pound bill for scraping it off payments, advised the Daily Mail.
Councils are furious that firms such as Wrigley refuse to contribute to the cost of removing discarded gum from the streets. Now the Local Government Association, which represents more than 370 councils, is demanding that gum manufacturers step up to assist in tackling the scourge.
Weetabix sold for £1.4bn after China’s appetite falls short
American cereal maker Post Holdings has confirmed it will buy Weetabix from its Chinese owner Bright Food for £1.4 billion, revealed the Guardian.
The news follows months of speculation after Bright Food, which owns Weetabix alongside Baring Private Equity Asia, put the business up for sale earlier this year.
No smoke without fire: New laws restricting sale of e-liquids and e-cigarettes will “make vaping more expensive”
New laws restricting the sales of e-liquids and e-cigarettes will ‘inevitably’ push up the cost of vaping, a trade organisation has warned in the Sun.
The rules that come in next month mean that firms are restricted to selling e-liquids in 10ml bottles. At the moment, they usually come in three sizes – 10ml, 20ml and 30ml bottles, although it depends on the supplier. Vapers will now have to order multiple bottles in order to get their usual hit.
Richard Hyslop, chief executive of the Independent British Vape Trade Association (IBVTA), told The Sun: “Some companies have spent hundreds of thousands of pounds getting products ready and doing the necessary testing needed in advance of these rules being enforced.
“Currently you can go and buy a 30ml bottle of e-liquid and after May 20 you’ll have to buy three 10ml bottles. Companies are doing their best not to pass these costs onto customers, [but] it’s inevitable that some companies will have to put up prices a little.”