July 26, 2009
From the BBC News:
The chancellor is to quiz bank bosses over how much they charge small firms for loans, saying he is “extremely concerned” their rates may be too high.
Alastair Darling said the cost of loans seemed to have risen, despite the UK’s record low base interest rate of 0.5%.
He told the BBC that banks had a duty to restore lending levels, saying the government did not rescue the banking sector “out of some charitable act”.
March 6, 2009
BBC reports on Mosaic going into administration.
Mosaic, which owns some of the most famous brands on the UK High Street, has gone into administration, with debts of about £400m.
But most of the group, including Oasis, Karen Millen, Warehouse and Coast have been immediately sold to Mosaic’s main creditor – Icelandic bank Kaupthing.
As the recession deepens it would appear that more and more retailers are going into administration.
February 16, 2009
Are we going to see the end of cash?
BBC Breakfast report on a possible cashless future.
February 6, 2009
The BBC reports on the huge increase in the number of businesses going bust!
There has been a huge rise in the number of firms going bust in England and Wales because of the recession.
The Insolvency Service said that in the last three months of 2008 there were 2,428 corporate insolvencies such as administrations and receiverships.
That was a 220% rise on the same period the year before.
This of course has an impact on suppliers of those businesses as well as the immediate impact on the employees.
This kind of negative news, along with job losses reported across the country makes consumers behave in the very way in which reinforces the recession, as spending reduces and firms cut back on production.
Things will start to change once the economy starts to feel that it is at the bottom and has higher expectations about the way in which the economy is moving.
More on the economic environment in which businesses operate.
January 7, 2009
The womenswear company Viyella, which was founded in 1784, has become the latest long-established British company to call in the administrators.
The company has annual sales of about £30m and operates 40 stores, 64 concessions and four clearance outlets.
Of course like other retailers mentioned in this blog, only Woolworths has actually closed, the others are “only” in administration, but more often then not this can lead to at a minimum closure of lots of stores.
Even retailers not in administration are feeling the pinch and closing stores. BBC also reports on Marks and Spencers who are closing stores and cutting jobs.
Marks and Spencer plans to close 25 of its small Simply Food stores and another two of its regular stores.
The closures will mean the loss of 780 jobs. The retailer is also planning to cut 450 head office jobs.
The retail sector which weathered the last few recessions has been hit very hard by this one. The difference this time, is that margins are tight so it doesn’t take a large drop in sales for it to have a major impact on the profitability of the retailers.
September 28, 2008
Over the last week (okay the last year) the credit crunch has been causing major problems in the financial world.
The BBC has a whole section devoted to the crisis.
August 28, 2008
BBC reports on how the credit crunch and rising food and fuel costs are having an impact the costs for snack firms.
Mars has become the latest snack firm to admit the credit crunch is eating into its business.
The Snickers bar and M&Ms maker said it would be raising the wholesale price of its goods to offset rising raw material, packaging and energy costs.
The news came days after fellow US firm Hershey raised its product prices.
Mars also said it would be cutting the size of some of its goods. In the UK, a number of firms have shrunk snack sizes to stave off price rises.
So we can expect our chocolate bars to get smaller (or get more expensive).