Thursday, 29 May 2008

E-mail banking scams

Welbeck has just forwarded an e-mail to Barclays Bank Internet Security department - it was received this morning and was headed with a poorly scanned image of Barclays logo and name and requested that we should follow a link in which we could confirm our banking details.

This is not a new scam, but even though the banks regularly warn about them people still seem to fall foul of them - because they look official (in this case with a nice little copyright Barclays 2008 at the bottom - neat touch, adds authenticity!).

Welbeck cannot imagine that a worldly wise SME owner will fall for this, but it is as well to ensure that if you have entrusted the answering of mails to others, particularly others with access to bank account details, are also fully aware that these are scams and not to be responded to.

Keep your details to yourself, the banks will NEVER send a message asking for confirmation of your account details. They will not ask for any private information except for password information to give you access to your accounts and services -so remember NEVER to give anyone else your passwords either, and change them periodically!

Discounters appear to be winning - a warning on discounts

The news in Retail Week is that the discounters in the food sector, including Lidl and Netto, may be gaining market share from Sainsbury and Tesco as a result of changing spend patterns arising from the pressure being applied to their customers purses.

Welbeck has often mentioned warnings about discounting, which needs clarification here. Discounting where it is the basis of the business plan and the supply chain is properly managed such as is the case with models such as Lidl et al is good business, and is paying off for them currently - they will always gain edge in recessionary periods - but the important thing for small retailers who are tempted to emulate these larger players is that it is the basis for their business plan and they do manage their supply chain. SME retailers can't just offer large discounts without first considering how this is to be financed and what it is trying to achieve.

The advice from Welbeck is clear - if the margins can be retained, then discount away, if not, then ensure that the period of discounting is limited and the reason for discounting is catered for in the discounting structure.

Thursday, 22 May 2008

Are we prepared?

I wonder if the title of the draft Queen's speech document published by the government this month is not without irony? It has been entitled "Preparing Britain for the Future", and was launched by the Prime Minister and the Leader of the House of Commons earlier in May; ignoring the first ridiculous thought that occurred to me, that it is as well that the government is preparing us for our future rather than for our past, but I let that one slide past.

Instead I was struck by the thought that given recent election results and the fact that there are signs that certain groups have spotted what they believe might be weakness in our nation's leadership and are circling ready to feed upon its carcass - it did fleetingly occur to me that this government might not have much of a future to lead us into - even as I write this the results for the Crewe and Nantwich by-election are anticipated. But that is not my real worry, no my real concern is about our preparedness to respond to the govenrment's request for feedback.

This draft document is peppered with items upon which the government is asking for our opinion, and tells us of other matters upon which our opinion had already been sought. I wonder how many small businesses are aware of this opportunity to feed directly into the government's thinking - very very few that I have spoken to were aware of it. However, a number of large organisations have already made comments and are publicly saying as much, but there are several proposed bills that will impact directly upon the small businesses who might be out of the loop.

My advice is to follow these links:

an extract:
Business rate supplements: a White Paper (October 2007)
followed extensive public debate on this subject, and the measures in it will not be subject to further consultation before the Bill is introduced. However, the Government will be consulting on the detail of implementing the scheme through secondary legislation and guidance, for example arrangements for votes on supplements where required and defining "economic development". In the meantime any suggestions on detailed implementation of the policy set out in the White Paper should be sent to

For many of the issues in the paper:

Go to the 10 Downing Street and Parliament web-sites and read the whole document - if, like me, you have difficulties finding the paper try the Northern ireland Office site - it's all there. Very well informed are the folk of Northern Ireland.

Remember that these consultations may lead to regulation that will affect your business - act now or miss the opportunity.

Friday, 16 May 2008

More shops in jeopardy? Consequences of charging rates on empty properties.

I have recently completed some research in a town centre that is a major shopping destination and have been hit by the number of empty shops on the periphery of the core retail area. It was clear that they had not all become vacant for the same reasons - town centres are complex organisms so that was reasonable; but they are all now subject to the new regulations and are therefore subject to national non-domestic rates, which are now payable even if the property is empty.

I have to wonder if the introduction of this measure will be yet another with unintended consequences for the government, especially given the unfortunate timing with the retail downturn associated with the global credit crunch and its knock-on effects.

The purpose of the change in the regulations was clearly to force landlords to make their properties available to rent, presumably expecting market forces to set prices that would attract tenants even in the most unglamourous of locations. This may well have been true before the onset on this latest cyclical downturn but the current market is seeing reductions in retail space and less capital available from traditional lending sources for new businesses. It must, therefore, be reasonable to anticipate that the landlords with spare capacity will simply not be able to let because of a lack of potential tenants. This must then present the landlords, particularly those in peripheral areas, with a dilemma - do they stoically march on in an exceptionally unpredictable market and be saddled with ever rising business rates to pay, or do they sell?

If these properties are sold, it is likely that they will be to developers, and these developers are unlikely to develop retail. Consequently we will see the further retraction of traditional retail areas and the potential for more food deserts in areas of urban deprivation. I think it is time for HM Treasury and the planners at central and local government levels to appreciate that the ideas intended by this measure simply will not be realised in the current economic climate, and it is more likely that they will promote long-term consequences of reducing space for new business for when the up-turn begins.

Tuesday, 6 May 2008

OFT draws a line

I have been amazed at the news in the Retail Bulletin over this last weekend (4 May); they report that Mr John Fingleton, the Chief Executive of the Office of Fair Trading has "accused consumers of being 'schizophrenic' as he attempted to draw a line under the argument that supermarkets were responsible for the closure of local shops", he went on "if shops are closing it is because people don't go and shop in them, and that's not our problem..."

Oh dear, oh dear! We do seem to have made very muddy waters with these arguments about small shops in the food sector, not helped by well intentioned campaigns by lobbying groups who take a fact - distort it, and then feed it back in as testimony. But Dear Mr Fingleton, it is your job - a highly paid job, paid for from our taxes; including the small retailers' - to get behind these stories and to ensure that all aspects of fair competition are exposed, analysed, commented upon and wherever necessary acted upon. It seems to me that Mr Fingleton and Mr Peter Freeman (Chair of the Competition Commission inquiry) have together been in receipt of masses of evidence, claim and counter-claim; it seems also to me that sufficient amounts of this evidence have indicated the real possibility of trading tactics which if they were being carried out by small retailers without the same degree of the power of influence as others in the market place, then they would, by the end of May 2008, probably be liable to prosecution under the Consumer Protection from Unfair Trading Regulations 2008.

The furore over the loss of independent food shops is not merely a case of choice by consumers; in reality it is a range of issues, of which it has to be admitted, some are brought about by the smaller retailers themselves. Smaller retailers do need, so often, to smarten up their acts - but they might argue that almost any strategy they employ to do so would involve expense, and their margins are severely under pressure already; but that is another story. This blog is focussed on unfair trading. It is impossible that the OFT and the Competition Commission inquiry did not receive any plausible evidence of unfair trading - good grief, it is still being provided by the large players themselves. Is it not the case that Wal-Mart ASDA has put forward evidence of wrong-doing so to be able to claim immunity from prosecution themselves, just this week? Did the inquiry discover this when they were sitting? Does this not in itself present evidence that at least one firm was less than forthcoming during the enquiry? Is it not the case that if you do not ask the precise and explicit question of these firms then you will receive imprecise and inexplicit responses?

Dear Mr Fingleton, instead of merely taking the stance that 'if consumers do not shop in a particular place that this is evidence of real choice' try looking at the supply chain dominance using methods of investigation that do not disadvantage to the supplier, try seeking explanations about the impacts of planning policy and how the SME retailer is disadvantaged in terms of place. Try to look at imbalance in the power of influence that exist at local level, at regional levels and most of all at national level between the players . Most of all remember, what is true today of the food stores is rapidly becoming true also of other sectors and that no matter how tedious you imagine this story is ... it is going to be with us for a good while yet!