You may know Samsung for its smartphones and household appliances, but how about its insurance arm or holiday resorts? CNBC’s Uptin Saiidi gets a rare look inside the headquarters of one of the world’s largest companies.
You may know Samsung for its smartphones and household appliances, but how about its insurance arm or holiday resorts? CNBC’s Uptin Saiidi gets a rare look inside the headquarters of one of the world’s largest companies.
INSIDER tours a $7 million New York City dream apartment that has a zipline, spiral slide, climbing wall, monkey bars, and more. It’s a kid’s dream home in the middle of Manhattan! Aly Weisman goes to the SoHo loft to get a tour of the most unique apartment in the city.
Mark Fuller is the eccentric owner of what could be the most technically advanced water fountain-maker on the planet (the Fountains of Bellagio in Las Vegas being among his more famous). In this episode of “Hello World,” Ashlee Vance travels to Burbank, California, to chat with Mark, and see how his $200 million water features are created.
For decades, Toys “R” Us was not only one of the top toy retailers in the United States, it was one of the top retailers period. Until it suddenly wasn’t. Toys “R” filed for bankruptcy in 2017 and liquidated six months later. This is the story of how Toys “R” Us went bankrupt.
(qlmbusinessnews.com via bbc.co.uk – – Fri, 15th Nov 2019) London, Uk – –
Amazon has filed an intention to appeal the US Department of Defense's decision to give a major contract to Microsoft.
Amazon had been considered the favourite to win the deal, worth $10bn over the next 10 years.
The company, which already provides cloud computing to the US Central Intelligence Agency, said the decision was made due to political pressure.
In July, President Donald Trump threatened to intervene after what he described as “tremendous complaints”.
Mr Trump had previously attacked Amazon chief executive Jeff Bezos, owner of the Washington Post, which has been critical of his presidency.
The Pentagon subsequently delayed its decision to award the contract until 25 October, when it was announced the work would be given to Microsoft.
Defence Secretary Mark Esper said the competition was fair.
“I am confident it was conducted freely and fairly without any type of outside influence,” he told reporters in the South Korean capital Seoul.
The Joint Enterprise Defense Infrastructure project – known as JEDI – is designed to modernise the antiquated data and communication systems within the US military. The contract is considered to be particularly lucrative if other government departments follow the Defense Department's lead when upgrading their own systems.
An Amazon spokesperson told the BBC: “Amazon Web Services is uniquely experienced and qualified to provide the critical technology the US military needs, and remains committed to supporting the DoD's modernisation efforts.
“We also believe it's critical for our country that the government and its elected leaders administer procurements objectively and in a manner that is free from political influence.
“Numerous aspects of the JEDI evaluation process contained clear deficiencies, errors and unmistakable bias – and it's important that these matters be examined and rectified.”
The BBC understands Amazon submitted its intention to protest against the decision to the Court of Federal Claims last Friday. The formal appeal itself will be filed at a later stage.
Microsoft did not respond to requests for comment.
Four companies had initially been in the running for the deal when the process was launched two years ago. IBM was eliminated, as was Oracle – which lodged an unsuccessful legal challenge alleging conflict of interest stemming from Amazon's hiring of two former Defense Department employees. Both were said to have been involved in the JEDI selection process.
By Dave Lee
(qlmbusinessnews.com via theguardian.com – -Fri, 15th 2019) London, Uk – –
UK-based Chilango in discussions about long-term planning, options and strategy
A UK-based Mexican restaurant chain that raised millions of pounds from small investors this year via a “burrito bond” scheme is in talks with restructuring experts about options for the business.
Chilango, which has 12 UK outlets, most in London, made headlines around the world in 2014 when it launched its quirkily named bond, and earlier this year announced that it had pulled in £3.7m from hundreds of small investors who had signed up for “burrito bond 2”.
The Guardian was told that Damian Webb, a partner at accountancy firm RSM who specialises in restructuring and who has been involved with several high-profile companies in recent months, had been brought in by Chilango. Options could include administration or a company voluntary arrangement, a form of insolvency that is deal with creditors.
A statement sent to the Guardian by Webb at RSM restructuring advisory said: “Chilango has engaged RSM to assist on working on long-term planning, options and strategy. All further inquiries should be directed to the company.”
In October last year, Chilango launched the burrito bond 2, which promised returns of 8% a year. It said the money would be used to refinance existing debt and open new outlets.
Chilango’s parent company, the London-based Mucho Mas, made a loss of £1.4m in the year to 25 March 2018, the latest period for which accounts are available, and a loss of just under £3.2m the year before.
As of Wednesday, its finance arm, Chilango Bonds, was six weeks late filing its accounts at Companies House.
Chilago’s chosen form of fundraising, known as a mini bond, allows a company to raise capital by borrowing directly from the public, and has proved popular with small investors desperate for better returns. Individuals receive a fixed interest rate and, when the bond matures, their capital is returned to them.
Many companies have issued them, but this year the Financial Conduct Authority said mini bonds could be high risk, and there is no Financial Services compensation scheme protection if the company issuing the mini-bond fails.
In April Chilango said the burrito bond 2 had raised more than £3.7m, making it “one of the most popular alternative investment offers of recent times”. Nearly 800 investors put money in – including 194 who qualified for a Chilango “black card” entitling them to a free burrito every week for the lifetime of the bond after committing at least £10,000 each.
The company said the latest sum raised comfortably surpassed the £2.1m brought in by the original burrito bond in 2014, which was snapped up by more than 700 individuals and covered by publications such as the Wall Street Journal.
The latest investment is an unlisted corporate bond with a four-year term paying a fixed 8% a year interest.
At the time of the burrito bond 2 offer, Chilango’s website highlighted the risks – it said that in the event that Chilango Bonds or a member of its group became insolvent, “you may lose some or all of your investment … If you suffer a loss, you are not entitled to compensation from the Financial Services compensation scheme.”
Chilango, which opened its first restaurant in north London in 2007, has 10 outlets in the capital, plus one in Manchester and another in Birmingham.
Eric Partaker, Chilango’s chief executive and co-founder, said there was “nothing to report … We are working with RSM on some long-term business planning.”
By Rupert Jones
(qlmbusinessnews.com via news.sky.com– Thur, 14th Nov, 2019) London, Uk – –
The launch numbers outstripped some forecasts, but it was not immediately clear how many customers came from free promotions.
Disney says more than 10 million subscribers signed up for its new streaming service on its first day of launch.
The “extraordinary consumer demand” saw shares in the entertainment giant rise by 3.5%.
Disney+, the competitor to the likes of Netflix and Amazon, launched in the US, Canada and the Netherlands earlier this week.
The platform is offering a mix of Marvel and Star Wars films and shows, every episode of the Simpsons, new series and classic content from the back catalogue of the world-famous studios.
Disney+ will be rolled out to the UK and Ireland from next March.
Although numbers from the launch day were more than three times the size of some forecasts, it was not immediately clear how many subscribers came from promotions.
Customers of some Verizon phone and internet packages were offered a year free.
Disney has invested billions in its streaming service, which costs $7 (£5.40) a month or $70 (£54) a year after a seven-day free trial.
Some analysts thought it would take Disney a year to reach 10 million subscribers.
In April, Disney said it plans to have up to 90 million Disney+ subscribers globally by 2024.
Netflix, which launched in 2007, now has 158 million subscribers.
(qlmbusinessnews.com via theguardian.com – – Wed, 13th Nov 2019) London, Uk – –
A group of Facebook workers say they are treated as if they ‘do not belong’ at the company
One year after a former Facebook manager accused the company of having “a black people problem” – failing its black employees by allowing the proliferation of a hostile workplace culture — an anonymous group of tech workers at the social media giant have penned a letter in which they argue that the problem has only metastasized.
“Racism, discrimination, bias, and aggression do not come from the big moments,” they write. “It’s in the small actions that mount up over time and build into a culture where we are only meant to be seen as quotas, but never heard, never acknowledged, never recognized, and never accepted.”
The memo, published last week on Medium, includes descriptions of discrimination and hostility that 12 current and former employees of color, including black and Latinx workers, said they’ve experienced at the company. The writers say the alleged incidents all had witnesses and corroboration.
One Facebook program manager said they were told by two white employees to clean up after their breakfast-mess and that when the employee raised the issue their supervisor only said the worker should “dress more professionally”.Other writers said supervisors and colleagues called them aggressive and arrogant for sharing opinions in ways similar to their white colleagues.
“[W]e are sad. Angry. Oppressed. Depressed. And treated every day through the micro and macro aggressions as if we do not belong here,” employees write in the memo.
The employees further alleged they were brushed aside by human resources staff when they asked that the aggressions be addressed.
Facebook did not immediately respond to an email from the Guardian, but in a statement sent to reporters on Friday, Bertie Thomson, Facebook’s vice-president of corporate communications, apologized.
“No one at Facebook, or anywhere, should have to put up with this behavior,” Thomson wrote. “We are sorry. It goes against everything that we stand for as a company. We’re listening and working hard to do better.”Advertisement
The memo on Medium included screenshots of an app that allows Facebook employees to comment anonymously on issues and colleagues at the site.
“These people make it seem like they work for the KKK,” one staff member reportedly wrote, referring to employees of color and last year’s viral post from Mark Luckie, the former employee who thrust the company’s race relations into the spotlight.
“They should feel privileged that they were diversity hires and got into the company after we lowered our hiring standards. That’s just my opinion, though.” The screenshot is followed by a poll showing that more than 66% of respondents felt that black employees “just complain to get attention”.
The recent letter has garnered buzz, but concerns over race relations at Facebook are long-standing. A 2013 diversity report showed that the companys’s US workforce – in particular its leadership – was dominated by white men, while black and Hispanic employees made up just 2% and 4% of its staff, respectively. Two years later, its percentage of black employees had barely changed.
Luckie, the former Facebook employee, wrote in his 2018 memo that the company’s lack of diversity has led to racially biased content removal and account suspensions. In a claim echoed by this year’s anonymous letter, Luckie wrote that Facebook leadership paid strong lip service to creating equitable policies and building a diverse staff, but doesn’t back up its stated convictions in practice.
“In some buildings, there are more ‘Black Lives Matter’ posters than there are actual black people”, Luckie wrote last year.
By Mario Koran
(qlmbusinessnews.com via bbc.co.uk – – Wed, 13th Nov 2019) London, Uk – –
Tesla's chief executive, Elon Musk, has said Berlin will be the site of its first European factory as the carmaker's expansion plans power ahead.
“Berlin rocks,” Mr Musk said, adding Tesla would build an engineering and design centre in the German capital.
Tesla previously said it aimed to start production in Europe in 2021.
The moves come as the firm, which has also invested heavily in a Chinese factory, faces intensifying competition in the electric vehicle industry.
Mr Musk made the announcement at an awards ceremony in Germany on Tuesday.
“Everyone knows that German engineering is outstanding and that's part of the reason we are locating our Gigafactory Europe in Germany,” he said.
Mr Musk also cited risks surrounding the UK's exit from the EU for his decision, according to AutoExpress.
“Brexit [uncertainty] made it too risky to put a Gigafactory in the UK,” he told the trade magazine.
Mr Musk said the facility would be located near the new Berlin airport and later gave more details on what the factory would produce on Twitter.
The focus on Germany comes amid rising appetite for electric cars in Europe.
Over the coming years, the biggest electric car production plants will be in Germany, France, Spain and Italy, industry analysis showed.
Some 16 large-scale lithium-ion battery cell plants are confirmed or due to begin operations in Europe by 2023.
Tesla's European plan comes as the carmaker also moves ahead with a $2bn (£1.6bn) factory in Shanghai.
The firm is looking to ramp up production in China, the world's biggest car market, where sales have been hurt by tariffs triggered by the US-China trade war.
The Shanghai facility will produce Model 3 and Model Y cars. The automaker reportedly showed off its new China-made vehicles to local media this week.
Still, Tesla has struggled with years of losses, fuelling investor doubts and casting a shadow over its shares in recent years.
The firm has yet to turn an annual profit, although it recorded positive results in the final two quarters of 2018.
Last year, Tesla took aggressive steps to slash expense, cutting thousands of jobs and reining in other spending.
(qlmbusinessnews.com via news.sky.com– Tue , 12th Nov 2019) London, Uk – –
The firm says the “situation is critical” and could pull out of the country, where it is the largest foreign direct investor.
UK-based mobile giant Vodafone sank to a loss of £1.6bn after a ruling by India's top court threatens to land it with huge fees and penalties.
The firm has described it as a critical situation and warned it could pull out of the country, where it is the largest foreign direct investor.
The court judgment against the telecoms industry relates to a decade-long battle over the calculation of licence and other regulatory fees.
Vodafone said its liability appeared to be at least £3.2bn but warned it “could be substantially higher”.
The mobile operator said it may seek a review of the supreme court's decision, which saw it post a loss in the six months to 30 September.
Announcing its results for the period, the company said: “In October the Supreme Court in India ruled against the industry in a dispute over the calculation of licence and other regulatory fees, and Vodafone Idea is now liable for very substantial demands made by the Department of Telecommunications in relation to these fees.
“We are actively engaging with the government to seek financial relief for Vodafone Idea.”
Vodafone chief executive Nick Read said: “The situation is critical. I think the government are left in no doubt on our position.
“We are India's largest foreign direct investment investor and I think there's a moment where you have to say we've been commercially successful and our brand is strong.
“What we need is a supportive regulatory environment and prices that are sustainable.
“It's been a very challenging situation for a long time and, if you look at the share price in India, it is effectively has zero value.”
Mr Read revealed he had travelled to India with Vodafone's chairman, Gerard Kleisterlee, last month to lay out the company's demands to ministers.
He has asked for a two-year moratorium before any payments are made, lower taxes in the country, the waiving of interest and fines associated with the judgment, and to spread out the fee costs over 10 years.
Mr Read added: “We've committed a lot of capital to India and we've made a decision we will not put further capital in (until the issue is resolved).”
Elsewhere in the business, Vodafone said its overall revenues over the six-month period had gone up after a return to growth “supported by improvements in South Africa, Spain and Italy, with solid retail performance in Germany and strong commercial acceleration in the UK”.
The company's reported revenues rose 0.4% to €21.9 (£18.8bn).
Vodafone also increased its profit guidance to €14.8-€15bn (£12.7bn-£12.9) from €13.8-€14.2bn (£11.9bn-£12.2bn), pointing to the acquisition of Liberty Global's assets in Germany and the sale of its New Zealand business.
(qlmbusinessnews.com via bbc.co.uk – – Mon, 11th Nov 2019) London, Uk – –
British Steel is set to announce a rescue deal with China's Jingye Group, which could safeguard up to 4,000 jobs in the UK.
Jingye Group has agreed in principle to buy British Steel for £70m.
It is understood that the government will help in the form of loan guarantees and other financial support.
British Steel has been kept running by the government via the Official Receiver since May, when the company went into liquidation.
As well as employing 4,000 people at its Scunthorpe and Teesside sites, British Steel supports an additional 20,000 jobs in the supply chain.
Another 1,000 jobs are based in France and the Netherlands – those are included in the deal too.
It is expected that an agreement will be signed, but that the company will continue to be run by the Official Receiver for at least a month before being transferred.
Gareth Stace, director general of industry lobby group UK Steel, told BBC Radio 4's Today that the business being bought was a “significant asset to our country” as it makes up a third of UK steel production, mostly from Scunthorpe.
He said that there was a need for “very significant investment” in the Scunthorpe works and that was why the expected announcement from Jingye was “really welcome”.
“Jingye are looking to make significant investment, are in for the longer term and therefore it isn't about keeping this site going for a year or two or a couple of years. To me, what I understand about the company, it's about looking to the future, so we're not going to be back in here in three years, five years, in 10 years' time.”
The firm had previously been in rescue talks with Ataer, which is a subsidiary of Turkey's state military retirement scheme Oyak.
Analysis: By Dominic O'Connell
What does a steel maker from Hebei province, south-west of Beijing, see in a struggling plant in Scunthorpe? It is difficult to know, particularly when we know so little about the buyer of British Steel, Jingye Group.
There is little publicly available information – certainly no set of accounts – but the organisation's Facebook page extols its rapid rise to become a big player in steel in just 20 years.
In the process, it has “laid an extraordinary road of development with wisdom and perspiration”, the voiceover of one of promotional video says, with ranks of identically overalled workers smiling on the steps of its rather grand headquarters.
On the face of it, the Chinese buyer will be interested in the products that British Steel makes that it does not. British Steel is a specialist in railway tracks, “long products”, a catch-all term for girders used in construction, and the high-quality steel wire used in car tyres and dozens of other industrial applications.
Jingye does not appear to make the first two, so the purchase of British Steel should bring it some valuable technology and new product lines. That plus has to be set against the need for investment at Scunthorpe; if, as reported, Jingye wants to increase production, blast furnaces and coke ovens will have to be refurbished at a price tag estimated at £500m.
What British Steel workers will fervently hope is that the Jingye commitment is long-term and that this is not another false dawn.
According to Mr Stace, British Steel's output complements Jingye. He says both British Steel and Jingye make wire rods, but there is one crucial difference.
“Actually British Steel makes rail, high-quality rail and heavy sections, ie girders, which Jingye doesn't make. [So it] not only increases the amount of different products that Jingye could make but also, much more importantly, secures a foothold in the UK.”
Mr Stace said he believed the steel industry in the UK could now compete globally and he was publishing a manifesto with ideas for change.
“But the problem we have is we have a uncompetitive business landscape in the UK. government can change that,” he added.
“I'm talking about energy costs, business rates, procurement – the government buying more steel from the UK – free and fair trade, and even much more support for R&D [research and development], which we are going to lose when we fall out of the EU.”
He said: “What government needs to do is give us that business landscape. We can thrive on the global market and generate highly paid, highly skilled jobs for the UK economy.”
It is expected that the employees will be briefed on the latest developments this morning as they come to work. A formal announcement is due later on Monday morning or early afternoon.
In the long term, it is believed that while Jingye Group has promised to increase production, it has also warned costs may need to be cut.
The Chinese group is reportedly aiming to increase production at Scunthorpe from 2.5 million tonnes per year to more than three million.
Jingye's chairman, Li Ganpo, recently visited British Steel's sites and met Scunthorpe MP Nic Dakin and Andrew Percy, representative for the Brigg and Goole constituency.
Mr Percy told the Grimsby Telegraph he had been given assurances over the company's future.
Community, a UK trade union which absorbed the old Iron & Steel Trades Confederation (ISTC) body, said: “If this is confirmed, then we welcome this positive step towards securing British Steel under new ownership,
“The fact that there has been ongoing interest from both Ataer and now Jingye rightly demonstrates that potential buyers believe that British Steel can have a sustainable future.”
Meanwhile, Ross Murdoch, national officer for the GMB union, said: “On the face of it, we cautiously welcome this sale, which finally provides some light at the end of the tunnel for 4,000 British Steel workers.
“GMB also met with Chairman Li and his senior team in Scunthorpe on 30 October. We were impressed with the passion and enthusiasm from the Jingye team.
“However, due diligence on this sale was completed very quickly and the devil will be in the detail.”
The UK industry has been struggling for a number of years amid claims that China has been flooding the market with cheap steel. In 2016 the EU imposed tariffs of up to 73.7% on Chinese steel after an influx of cheap imports from Asia forced European manufacturers to cut jobs and lower prices.
Jingye has 23,500 employees and as well as its main steel and iron making businesses, but also engages in tourism, hotels and real estate.
It has total registered assets of 39bn yuan (£4.4bn). According to its website, Jingye Group ranked 217th among the top 500 enterprises in China in 2019.
The firm sells its products nationwide and exports them to more than 80 countries and regions.
Jingye's products have been used in major projects such as Beijing Daxing International Airport and the underground system in Shijiazhuang.
In less than three years, TikTok has become one of the most popular social media apps on the planet. Timothyna Duncan reports on the app’s success.
Aeroponics grows fruits and vegetables faster, cheaper and better. Vertical farming with Tower Gardens is on the ‘rise' and rightfully so. You can grow a variety of plants without ANY soil and 90% LESS water. It also requires 10x less space so you can do a lot more in a smaller area. That means easily growing fresh herbs, fruits, vegetables, and flowers both indoors and out. And because everything is grown and picked fresh, the flavor is unbelievable!
Today we take you to Atlanta, Georgia to tour the sprawling Tyler Perry Studios. Home to productions like Marvel’s “Black Panther” and AMC Networks’ “The Walking Dead,” the self-made entertainment legend’s production compound is larger than Warner Bros. and Walt Disney’s Burbank studios combined.
12 newly-dedicated sound stages are joined by an entire backlot neighborhood called “Maxineville,” featuring a perfect replica of Madea’s house. Tyler Perry Studios is the centerpiece of Georgia’s burgeoning film industry and a testament to the vision, success, and generosity of its founder.
In less than one year, WeWork went from having a $47 billion valuation and being the darling of the venture capital world to needing an $8 billion infusion to avoid running out of money. This is the story of Adam Neumann, Softbank's risky investment, a failed IPO and how we got here.
(qlmbusinessnews.com via news.sky.com– Thur, 7th Nov 2019) London, Uk – –
The company says it is making progress in boosting its fortunes in the wake of its failed bid to merge with Asda.
Sainsbury's has reported a slump in pre-tax profits, with sales falling despite price cuts and new value ranges.
The supermarket chain, which also owns Argos, said it had achieved “positive momentum in grocery market share” in highly competitive times.
But it reported a 0.2% decline in group sales to £16.8bn over the 28 weeks to 21 September – its first half – with like-for-like sales, a comparable measure, falling 1%.
Trading pre-tax profits fell 15% to £238m. Sainsbury's blamed the phasing out of cost savings and tough weather comparisons.
On a statutory basis, pre-tax profits which include one-off costs came in at £9m. The figure covering the same period last year was £107m.
The company said this was mainly explained by a previously-flagged £203m writedown in the value of its estate that was mainly non-cash and reflected store closures.
Sainsbury's said its grocery and clothing offerings had a better performance in the second quarter than in the first.
Its chief executive, Mike Coupe, is under pressure to grow revenue after being accused of taking his eye off the ball as he fought for a £12bn merger with Asda.
The deal was blocked on competition grounds in April.
Mr Coupe said of the first half performance: “We have created positive momentum across the business through strategic investments in our customer offer.
“We have lowered prices on every day food and groceries, launched a range of value brands and are more competitive on price than we have ever been.
“We are investing in hundreds of Sainsbury's and Argos stores, introducing new products and services and continually improving service and availability. As a result, customer satisfaction has increased significantly year on year.”
The company guided that the retail sector remains “highly competitive” – a consequence of the price war that has been raging for years as discounters Aldi and Lidl capture market share from the ‘big four' chains.
Sainsbury's raised its interim dividend by 6% and shares, down 22% in the year to date, opened 1% higher.
Sophie Lund-Yates, equity analyst at Hargreaves Lansdown, said of the results: “The supermarket landscape has become more competitive and Sainsbury is fighting to keep sales moving in the right direction.
“We've had good news from M&S' food business this week, and its deal with Ocado will just add more pressure into the mix.
“It begs the question: what can Sainsbury's do to differentiate itself? The integration of Argos has been a step in a new direction, but despite the cross-selling potential, it hasn't been enough to boost overall sales.”
By James Sillars
(qlmbusinessnews.com via bbc.co.uk – – Thur, 7th Nov 2019) London, Uk – –
Airbnb says it will verify every single property on its platform after a news website found a series of scams.
In October, Vice News uncovered a pattern of false or misleading property listings posted on the rentals site.
Airbnb said it would review every property by December 2020, and also promised to refund customers if they were misled by inaccurate listings.
It is the first time Airbnb, which launched in 2008, has pledged to verify every home promoted on its platform.
During its investigation, Vice News spoke to several people who had booked accommodation on Airbnb and been scammed.
When the guests arrived for their holiday, they typically received a last-minute phone call from the landlord saying the property was no longer available, due to an emergency or double-booking.
They would then be moved to another property, often in a different area and without the amenities promised in the original booking.
In many cases the guests felt they had no option but to stay at least one night, after arriving late at night in a city far from home.
But they say Airbnb then refused to give them a full refund despite the misleading bookings.
In a series of tweets, Airbnb chief executive Brian Chesky said: “Airbnb is in the business of trust. We are making the most significant steps in designing trust on our platform since our original design in 2008.”
Adam French, a consumer rights expert from Which?, told the BBC: “Holiday booking fraud is on the rise, with people losing millions every year to fraudsters tricking them out of their money with holiday lettings that do not actually exist.
“Steps from Airbnb to finally verify all of its listings are positive, but the industry must do more to ensure people are no longer being stripped of their money and having their holiday plans left in tatters.”
On 2 November, Airbnb said it would ban “party houses” after a mass shooting at a California home rented through the company left five people dead.
And in 2017, it changed its security policy, after a BBC investigation found criminals were hijacking accounts and burgling homes.
(qlmbusinessnews.com via bbc.co.uk – – Wed, 6th Nov 2019) London, Uk – –
Marks and Spencer profits dropped in the first half of its financial year following a sharp fall in demand for its clothes and home goods.
The High Street retailer said that while its food business was “outperforming the market”, there had been issues in clothing and home.
Marks and Spencer is undergoing a transformation plan led by chief executive Steve Rowe.
He said after a “challenging” first half, it is now seeing improvements.
Overall, pre-tax profits tumbled by 17% to £176.5m on total sales down 2.1% to £4.86bn.
Like-for-like sales in clothing and home fell by 5.5% during the six months to 30 September, worse than an expected 4.3% drop.
Despite that, in early morning FTSE 250 trading the company's shares were up 6.3% at 193.94 pence.
M&S said there had been “availability challenges” as a result of “supply chain issues and a shape of buy that remained too broad”.
The company is facing competition from fashion giants such as Primark on the High Street and Asos on the internet.
It said its clothing business “has historically been too slow to market” and had “too many slow-moving lines”.
It also said it was going to ensure that they had enough product in all sizes, and would be quicker to restock popular and fast-selling items in stores.
In addition it said it would look to introduce slimmer cuts in clothing designs, which would be increasingly aimed at a “family market”.
M&S said it was seeing a positive response to its current winter season clothing, which it says is a “better value product”.
But retail expert Richard Hyman told BBC Radio Four's Today programme: “I think Marks and Spencer customers are not interested in price, as much as relevance. Making clothes cheaper is not the answer.
“When they talk about this season's offering, they are talking about a matter of weeks. The general outlook for Christmas trading is not looking very good across the trade.”
In contrast, like-for-like sales in food grew by 0.9%, ahead of a forecast 0.3% rise.
To stem the decline in food, M&S forged a joint venture with Ocado in February, agreeing to buy 50% of its retail business for £750m.
But Mr Hyman said: “I can't see the central logic of the Ocado deal. I don't think they have to be online in food at all. Online [food retailing] in the UK is 7% of the market, suggesting people are not clamouring to buy food online.”
And Neil Wilson, chief analyst at markets.com said that overall, change had been far too slow at the company.
But M&S boss Mr Rowe said the firm was now starting to see the benefits of its transformation plan. “For the first time we are beginning to see the potential from the far reaching changes we are making,” he said.
However, while it forecast some improvement in trading in the second half of the year, market conditions remain challenging.
In September, M&S was relegated from the FTSE 100 index of Britain's biggest listed companies.
It marked the first time the retailer had not been a FTSE 100 member since the index was launched in 1984.
(qlmbusinessnews.com via bbc.co.uk – – Wed, 6th Nov 2019) London, Uk – –
Troubled baby goods retailer Mothercare has called in administrators, putting 2,500 UK jobs at risk.
There will be a phased closure of all of its 79 UK stores, administrators from PwC said.
The UK firm “has been loss-making for a number of years”, but international franchises are profitable, PwC said.
On Monday the baby goods firm said it was “not capable” of being sufficiently profitable and that it had failed to find a buyer.
Joint administrator Zelf Hussain said: “This is a sad moment for a well-known High Street name,” adding that Mothercare “has been hit hard by increasing cost pressures and changes in consumer spending.”
“It's with real regret that we have to implement a phased closure of all UK stores. Our focus will be to help employees and keep the stores trading for as long as possible,” Mr Hussain said.
Mothercare chairman Clive Whiley said there was “deep regret and sadness that we have been unable to avoid the administration of Mothercare” and that the board “fully understand the significant impact on those UK colleagues and business partners who are affected”.
He added: “However, the board concluded that the administration processes serve the wider interests of ensuring a sustainable future for the company, including the wider group's global colleagues, its pension fund, lenders and other stakeholders.”
Mothercare said it was in continuing talks over possible UK concession stores and about using the brand to sell goods online.
It said it would move its pensions scheme across to its international business.
Former Mothercare store manager Michelle Smith lost her job in October 2018 when her Isle of Wight store was one of 51 to close.
She said she felt sorry for the people who will lose their jobs due to the administration.
When her store closed, it was “devastating” for the Isle of Wight, she said.
“My store was the only child and baby shop on the island,” she said.
While branded baby products can be cheaper online, a lot of people like to see, touch and feel products before buying them, she added.
However, online retailers don't have the same overheads, she said.
Michelle is now a store manager for Co-op.
The administration will be “disappointing for all the employees but it's not unexpected”, said Diane Wehrle, marketing and insights director at Springboard.
Since the firm negotiated a rescue deal with lenders last year, “they haven't changed anything fundamentally”, she said.
“The levels of investment needed to future-proof the business would have been so significant and they couldn't make that leap,” she added.
Ultimately, supermarkets and department stores ate into their market, plus cheaper online competitors, she said.
(qlmbusinessnews.com via news.sky.com– Tue, 5th Nov 2019) London, Uk – –
The company Facebook, which owns the social media network Facebook, wants users to realise there's a difference between the two.
Facebook, the company behind the social media platform also called Facebook, wants to avoid being confused with Facebook – but instead of changing its name, like Google did to Alphabet, it is changing its logo.
The new logo is still just the word Facebook, but it is capitalised where the social media platform's logo is in lowercase.
An animated image released by the company shows the logo in various colours, distancing it a little from the blue of the main Facebook platform – which the company is increasingly describing as an app.
Explaining the change, the company's chief marketing officer, Antonio Lucio, said “Facebook started as a single app”, although in truth Facebook started as a social networking website for Harvard students – not a single application.
But, as Mr Lucio continued: “Now, 15 years later, we offer a suite of products that help people connect to their friends and family, find communities and grow businesses.”
This range of products all under the Facebook umbrella has grown increasingly diverse. They include the major four platforms, Facebook, Messenger, Instagram and WhatsApp, as well as others which have a much smaller market share or are yet to launch.
Oculus, Workplace, Portal and Calibra are mentioned by Mr Lucio as sharing infrastructure as well as development teams – and the company is keen to avow that these are Facebook products.
For a company such as Google, the value of its Search brand benefits its other services, including Maps and Gmail – and they are available as interconnected services at the point of delivery.
However, for Facebook, which has expanded primarily by acquiring these other social media platforms which were foreign to its own development teams, the focus has been on assimilating those platforms and their users into its own business structures.
For a long time there was very little clarity about how the company would do this and if it could do so legally.
Earlier this year the company's executives were called in for an “urgent briefing” by the Irish data protection commissioner after confirming plans to integrate the Facebook, WhatsApp and Instagram platforms.
Those plans would see the company combine its data collection on the hundreds of millions of users of its separate platforms around the world – potentially bringing it into conflict with strict EU laws on how companies handle personal data.
Facebook's information campaign around its new branding would potentially increase its ability to argue that users had provided their informed consent to continue using these joined-up platforms.
“We started being clearer about the products and services that are part of Facebook years ago, adding a company endorsement to products like Oculus, Workplace and Portal,” explained Mr Lucio.
“And in June we began including ‘from Facebook' within all our apps. Over the coming weeks, we will start using the new brand within our products and marketing materials, including a new company website.”
Whether such signalling will be enough to address concerns about the company's market share remains to be seen.
By Alexander Martin