How strong really is the UK recovery?

wotsthat

antrobus wrote: »

Do you know that for a fact, or do you just think that is the case? I know that, for example, ASDA have claimed that being part of Walmart means that they have a 10% cost advantage over their rivals, whilst historically ASDA have experienced higher margins because of their focus on large stores. (Lower costs, see.)

Product margins that my business (and competitors) offer Asda are lower than those required by the rest.

It may be they have a cost advantage being part of Wal-Mart or run on lower costs but they tend to use this to fund lower prices. Historically, it's always been Asda driving low prices.

Say, Asda were a penny cheaper on Heinz beans - Tesco would match this but ask Heinz to fund that penny (allowing them to match price and their higher cash margin). That's why there's not as much duplication between Asda and Tesco because the suppliers attempt to avoid the direct comparison i.e. Coke cans are in different pack sizes and so on.

The problem Tesco have is that increasingly suppliers have been saying no and the desire to strip value out of innovation means consumers see less of it.

antrobus wrote: »

OK I get it. You're a Sainsbury's shopper trying to rationalise your choice.

...as well as being a shareholder!

Being a shopper is a recent development - always thought they were too expensive.

Shopping habits have definitely changed in our house though. Instead of Asda it's Aldi and Sainsburys.

Loughton_Monkey

purch wrote: »

If I knew any of this stuff about supermarkets, I think I would top myself. :eek:

There are far more valid reasons to top oneself than supermarkets. Besides, none of us wants to avoid aisle 14 which has one of those ghastly yellow "Wet Floor" plastic thingies because some thoughtless guy like you decided to slit your wrists there and get blood all over the floor....

I have never worked in a supermarket but have relatives who have done....

All you need to do is understand that they are ruthless, profit-seeking enterprises, exploiting suppliers, customers, and staff as much as they reasonably can.

Just put up with all the smoke and mirrors about caring for the environment, investors in people, organic this, fair trade that, wheezes of price matching, BOGOF, subtle lighting, dissimulation of 'per unit' pricing, and 100 other tricks to keep you spending more. These are mere ruses in the commercial game of competition.

dotdash79

Loughton_Monkey wrote: »

Maybe. But I think its also something to do with being predominantly in the North, where wages and costs are somewhat cheaper. I don't know if they have differential pricing geographically, but if not, I expect their 'offers' are less generous in the South.

ASDA run on a single price across all stores, however they have an internal auction system where they can bid on "specials", the store manager can then set that price so long if it makes a profit (I believe that part of the bonus is measured on the profit made on the specials).

Loughton_Monkey

Graham_Devon wrote: »

......Heres the main story on the telegraph website at the moment though. So it's not just me. It's being reported as "Fears for recovery as Britain's biggest retailers suffer 'disasterous' christmas".

Now, you could suggest it's a bit alarmist, and I'd agree, but it would be difficult to suggest the general theme of it can simply be ignored.

http://www.telegraph.co.uk/finance/newsbysector/retailandconsumer/10560351/Fears-for-recovery-as-Britains-biggest-retailers-suffer-disastrous-Christmas.html

What I guess I'm saying here, without wishing to offend anyone, is that, in reality, it's probably somewhere in the middle of your optimism and picking out the stores who have done well and my pessimism highlighting the stores with profit warnings.

Well who would believe it?

• Fastest annual UK retail sales growth in more than 9 years. Up 5.3% Year on Year.
• December up 2.6% from November.
• Above the expectations of many analysts.

After all that doom mongering barely a week ago, Graham, you can see that it was all misplaced.

It's all fine.

You must be as happy as a dog with two dicks. How will you be celebrating?

http://www.bbc.co.uk/news/business-25774455

mayonnaise

And George Osborne commenting that minimum wage could get an above inflation increase..... is probably a better indicator on the health of the UK economy than Debenhams X-mas sales.

He told the BBC the "economy can now afford" to raise the rate, currently set
at £6.31 an hour for people over the age of 21.

http://www.bbc.co.uk/news/uk-politics-25766558

michaels

Funnily enough any increase in the minimum wage is basically a tax on business as odds are between 75% and 95% of any increase comes straight back to the chancellor via a reduction in benefits (and to a much smaller extent income tax and NI).

Loughton_Monkey

mayonnaise wrote: »

And George Osborne commenting that minimum wage could get an above inflation increase..... is probably a better indicator on the health of the UK economy than Debenhams X-mas sales.....

He's talking about £7, which would be a 10.9% increase. Not bad.

Did you hear that Bishop on Question Time last night? Claims that if Minimum Wage had been kept uplifted at the intended amount, it would be £19 an hour now!

So the lunatic is talking about £38K or so as minimum wage!

Nice to know the church continues to be "In touch".....

ukcarper

Loughton_Monkey wrote: »

He's talking about £7, which would be a 10.9% increase. Not bad.

Did you hear that Bishop on Question Time last night? Claims that if Minimum Wage had been kept uplifted at the intended amount, it would be £19 an hour now!

So the lunatic is talking about £38K or so as minimum wage!

Nice to know the church continues to be "In touch".....

The minimum wage was £3.60 when introduced in 1999 looking at measuring worth in 2011 that would have been the worth £5.12 using RPI or £5.48 using earnings not sure where he got figures but obviously rubbish.

grizzly1911

Interestingly the Conservatives were against the introduction of a NMW back in 1999 but it is the run up to the election after all.

BBC news suggest £7 will bring it back (after inflation) to where it was pre GFC.

I thought the Bishops claims were a tad wide of the mark but I thought he was quoting from some other source.

wotsthat

Graham_Devon wrote: »

Heres the main story on the telegraph website at the moment though. So it's not just me. It's being reported as "Fears for recovery as Britain's biggest retailers suffer 'disasterous' christmas".

Lesson in journalism. They write what they think their readers want to hear because it's an ego booster having our confirmation bias massaged. Your pinch of salt needs to be increased in size.

Graham_Devon wrote: »

What I guess I'm saying here, without wishing to offend anyone, is that, in reality, it's probably somewhere in the middle of your optimism and picking out the stores who have done well and my pessimism highlighting the stores with profit warnings.

Turns out that even with my 'rosy tints' and optimism I was too bearish (as usual).

Anyway, like the doom-monger I am, I've got some googling to do - I'm looking for articles that suggest that this is bad news dressed up as good. Search words 'unbalanced economy', 'debt fueled' and the like.