Are these early signs of green shoots? Excuse the pun, but Philip Green is involved, so that may well be the case.
Apparently Green is a secret backer to buy the O2 shpping centre in London's Finchley Road for 92m pounds. If he's involved, he may well have seen now as being an ideal time to buy and that the collapse in commercial real estate is nearing an ebb.
It seems that Green is closely monitoring the property market for opportunistic raids. Once suggestion is that he may be looking for departement store-style shops to showcase his brands.
Only this month Green decided to integrate BHS and the Arcadia brands, including Top Shop, Burton and Miss Selfridge, in addition to announcing a roll our of Top Shop in the US.
A real entrepreneur
Monday, 9 March 2009
Friday, 6 March 2009
Quantitative Easing - do you get that from Boots...?
Quantitative Easing - sounds like some deadly remedy from childhood days. A lethal cough linctus or on similar lines to 'milk of magnesia'... It congures up images of Victorian institutions ...
But in fact, as we all now know, it's a fancy way of saying Gordy is printing money. It feels a bit like joining the ranks of Zimbabwe or being in the Weimar Republic in the 1930's - but what are the implications for us all and what is likely to happen? It didn't work for Japan in the late 90's so why take this big last gamble?
Reading the press on this, my conclusion is that we don't have much choice. We're damned if we do nothing and seem to be critisicised if we don't do anything. But 75 billion pounds of new money - it's mind boggling.
A month ago I wrote about business needing a kick start instead of another rate drop. Yesterday the Bank of England dropped the rate to 0.5% - a new unknown territory. Now 'quantative easing' can begin apparently, as all the other firepower has been used.
What will happen is that the BOE will create 'virtual money' (not actually print cash) and use this to buy bonds and other securities from banks in the hope that they will use the money to lend to business and consumers.
The big risk is that the banks will hoard the money and sit on their hands, and nothing will happen.
Let's hope not, as there's a lot staked on this, and not many options left.
But in fact, as we all now know, it's a fancy way of saying Gordy is printing money. It feels a bit like joining the ranks of Zimbabwe or being in the Weimar Republic in the 1930's - but what are the implications for us all and what is likely to happen? It didn't work for Japan in the late 90's so why take this big last gamble?
Reading the press on this, my conclusion is that we don't have much choice. We're damned if we do nothing and seem to be critisicised if we don't do anything. But 75 billion pounds of new money - it's mind boggling.
A month ago I wrote about business needing a kick start instead of another rate drop. Yesterday the Bank of England dropped the rate to 0.5% - a new unknown territory. Now 'quantative easing' can begin apparently, as all the other firepower has been used.
What will happen is that the BOE will create 'virtual money' (not actually print cash) and use this to buy bonds and other securities from banks in the hope that they will use the money to lend to business and consumers.
The big risk is that the banks will hoard the money and sit on their hands, and nothing will happen.
Let's hope not, as there's a lot staked on this, and not many options left.
Tuesday, 3 March 2009
Who has been swimming naked....?
As you will read from previous posts, I am determined to hunt out and highlight, wherever possible, the upside of the current downturn.
It was Warren Buffet who made the memorable comment in 2007 'When the tide goes out, you learn who's been swimming naked'. This has been particulartly the case in the US with Maddof (pronounced apparently as 'made-off' as in 'made off with your money'), and more recently Sanford, but I wanted to turn this analogy another way.
Now the economic tide is out, we can see who has been swimming naked. There were no great shocks when Woolies went down - we all knew it had been on the cards for years, and that the business had survived due to the boom years. Just as a below-average employee can survive in a large corporate environment when they should have been fired years before, so too poorly performing businesses seemed to get swept up in the frenzy.
The difference in performance between mediocre and great business in economic boom time is far smaller that you might think; in difficult times this difference can become a chasm. Therefore businesses that offer genuine value to customers will out-perform the rest - and dramatically so. So what differentiates the well dressed swimmers from the embarassed?
Some are well-placed because of the demise of their competition. Take for example Mothercare - a strong International business which is capitalising on the demise of Woolworths and Adams. Trusted brands that have been doing the right thing for a long time are also cleaning up - Pizza Express and McDonalds for example, are benefitting from those customers who believe they offer real value for money.
Niche players are thriving too. You wouldn't have thought of Whitbread as niche, but they have focussed on 3 core areas and have businesses that are performing well in the current environment - Premier Inn, Costa and Beefeater.
It was Warren Buffet who made the memorable comment in 2007 'When the tide goes out, you learn who's been swimming naked'. This has been particulartly the case in the US with Maddof (pronounced apparently as 'made-off' as in 'made off with your money'), and more recently Sanford, but I wanted to turn this analogy another way.
Now the economic tide is out, we can see who has been swimming naked. There were no great shocks when Woolies went down - we all knew it had been on the cards for years, and that the business had survived due to the boom years. Just as a below-average employee can survive in a large corporate environment when they should have been fired years before, so too poorly performing businesses seemed to get swept up in the frenzy.
The difference in performance between mediocre and great business in economic boom time is far smaller that you might think; in difficult times this difference can become a chasm. Therefore businesses that offer genuine value to customers will out-perform the rest - and dramatically so. So what differentiates the well dressed swimmers from the embarassed?
Some are well-placed because of the demise of their competition. Take for example Mothercare - a strong International business which is capitalising on the demise of Woolworths and Adams. Trusted brands that have been doing the right thing for a long time are also cleaning up - Pizza Express and McDonalds for example, are benefitting from those customers who believe they offer real value for money.
Niche players are thriving too. You wouldn't have thought of Whitbread as niche, but they have focussed on 3 core areas and have businesses that are performing well in the current environment - Premier Inn, Costa and Beefeater.
Tuesday, 24 February 2009
Have you noticed... the BBC have created a sub brand for the Credit Crunch?!
Have you noticed that the BBC have a new sub brand?
It has has a new logo and always appears in the News. It's called 'recession' and has a red squiggly line bouncing up and down (more down) with an arrow on the end.
So .. what will the next sub brand be? My insider tells me it could well be 'recovery?'. The question mark is important but what's the logo going to be .... the infamous green shoots...
But when will they start using this?? Meetings are still ongoing at the Beeb.
Then apparently there will be a 'recovery' sub brand so that we all enter into a new golden era...
Let's wait and see what happens. No doubt Peston will enlighten us.
It has has a new logo and always appears in the News. It's called 'recession' and has a red squiggly line bouncing up and down (more down) with an arrow on the end.
So .. what will the next sub brand be? My insider tells me it could well be 'recovery?'. The question mark is important but what's the logo going to be .... the infamous green shoots...
But when will they start using this?? Meetings are still ongoing at the Beeb.
Then apparently there will be a 'recovery' sub brand so that we all enter into a new golden era...
Let's wait and see what happens. No doubt Peston will enlighten us.
Lord Carter gives keynote speech on 'Delivering Digital Britain'. We were there.
The Crunch Breaker and the Leaptomorrow team (www.leaptomorrow.com) attended a breakfast function earlier today where Lord Carter, Minister in Her Majesty's Government for Communications, Technology and Broadcasting gave a keynote policy speech on the future of Digital Britain.
The eagerly awaited Carter Report revealed little newness and was a telling tale of the position the UK Government is now in. 'We're not quite sure what to do' was mentioned various times by Lord Carter, but in his brief overview of the report, which he has led, he highlighted several key areas the UK Government will focus on in their digital policy, which are briefly as follows:
1. Infrastructure - the Govermement have a commitment to link up to 90% of the UK population to high speed digital broadband, although no time span was given.
2. Content - the decision to turn off analogue for TV would not be followed in other media such as radio.
3. Proficiency - trying to balance the 'openness and freedom' of the Internet with finding solutions to illegality and piracy.
4. Digital Government - there is a commitment to delivering easier access and allowing the user to trail the goverment bodies. Plus Universal service.
5. Training - people who hold the future should be trained. Need to retain know how in the UK where we lead in design, graphics and the computer games industry.
All very interesting (!?) but luckily we had two other speakers offering challenging questions too - Neil Burkett, CEO at Virgin Media and Paul Bazelgette, sector guru, and responsible for Big Brother among other things..
- Public Utility vs Boosting the Economy - needs to be the latter. All very well making broadband available to all but we need to see a financial dividend. We need to make digital far more commercial and driving entrepreneurial opportunity. Currently a social dividend exists; and economic dividend does not.
- Old Organisations vs New Organisations - there's no point in the Government pumping money into yesterday's industries. We, as taxpayers, should not be protecting old business models that cannot be sustained. Allow these to wither and die.
And the lessons for small and medium sized businesses?
Think laterally. How can you use all aspects of New Media and grow your business? Think beyond your normal boundaries - the government are committed to widening fast speed connections, both land based and wireless. We, as entrepreneurs are those who have to come up with the triggers to drive new growth.
One thing is for sure. Things will be very different after this recession. There will be winners and losers. Let's make sure we're in the former.
The eagerly awaited Carter Report revealed little newness and was a telling tale of the position the UK Government is now in. 'We're not quite sure what to do' was mentioned various times by Lord Carter, but in his brief overview of the report, which he has led, he highlighted several key areas the UK Government will focus on in their digital policy, which are briefly as follows:
1. Infrastructure - the Govermement have a commitment to link up to 90% of the UK population to high speed digital broadband, although no time span was given.
2. Content - the decision to turn off analogue for TV would not be followed in other media such as radio.
3. Proficiency - trying to balance the 'openness and freedom' of the Internet with finding solutions to illegality and piracy.
4. Digital Government - there is a commitment to delivering easier access and allowing the user to trail the goverment bodies. Plus Universal service.
5. Training - people who hold the future should be trained. Need to retain know how in the UK where we lead in design, graphics and the computer games industry.
All very interesting (!?) but luckily we had two other speakers offering challenging questions too - Neil Burkett, CEO at Virgin Media and Paul Bazelgette, sector guru, and responsible for Big Brother among other things..
- Public Utility vs Boosting the Economy - needs to be the latter. All very well making broadband available to all but we need to see a financial dividend. We need to make digital far more commercial and driving entrepreneurial opportunity. Currently a social dividend exists; and economic dividend does not.
- Old Organisations vs New Organisations - there's no point in the Government pumping money into yesterday's industries. We, as taxpayers, should not be protecting old business models that cannot be sustained. Allow these to wither and die.
And the lessons for small and medium sized businesses?
Think laterally. How can you use all aspects of New Media and grow your business? Think beyond your normal boundaries - the government are committed to widening fast speed connections, both land based and wireless. We, as entrepreneurs are those who have to come up with the triggers to drive new growth.
One thing is for sure. Things will be very different after this recession. There will be winners and losers. Let's make sure we're in the former.
Monday, 23 February 2009
Do your research before going International - Tesco got it wrong
Yesterday's Sunday Times ran an article which began 'Tesco admits: we got it wrong in the US'.
Tesco. The one company that doesn't make mistakes. The company that drove a customer loyalty program to beat all others, boasting that it knew every minutae of millions of shoppers' habits in the UK. It knew its customers buying patterns so well that it could market product at the right time of the day and in the right part of the store.
So what went wrong in the US? It seems that they didn't take enough time to find out about their customers in this new market. Maybe they just thought they could apply the same models again.
But that's the key with International growth - it's an old cliche but it really is a question of 'Think Global, Act Local'. Make sure you get to know your target markets passionately.
So what went wrong with Tesco?
It seems that their US operation, Fresh and Easy got its early market research wrong. Marketing Director, Simon Uwins said 'we went into people's houses, talked to them about food and food shopping. We went into kitchens and poked around pantries'. This was all before the launch of 113 stores on the West Coast.
Unfortunately, he now admits, they didn't go into the garage where they would have found huge chest freezers full of stockpiled meat bought on special offer. In the US, it seems, consumers are driven by the weekly 'special offer flyers' so common in US food retailing. Tesco missed this and didnt realise the market was so driven on price and tactical manoeuvering - they have suffered and now have put the full roll out of 200 stores on hold for 6 months.
So the lesson is simple - make sure that every new market is researched fully. It doesn't naturally follow that the same format will work in all.
Tesco. The one company that doesn't make mistakes. The company that drove a customer loyalty program to beat all others, boasting that it knew every minutae of millions of shoppers' habits in the UK. It knew its customers buying patterns so well that it could market product at the right time of the day and in the right part of the store.
So what went wrong in the US? It seems that they didn't take enough time to find out about their customers in this new market. Maybe they just thought they could apply the same models again.
But that's the key with International growth - it's an old cliche but it really is a question of 'Think Global, Act Local'. Make sure you get to know your target markets passionately.
So what went wrong with Tesco?
It seems that their US operation, Fresh and Easy got its early market research wrong. Marketing Director, Simon Uwins said 'we went into people's houses, talked to them about food and food shopping. We went into kitchens and poked around pantries'. This was all before the launch of 113 stores on the West Coast.
Unfortunately, he now admits, they didn't go into the garage where they would have found huge chest freezers full of stockpiled meat bought on special offer. In the US, it seems, consumers are driven by the weekly 'special offer flyers' so common in US food retailing. Tesco missed this and didnt realise the market was so driven on price and tactical manoeuvering - they have suffered and now have put the full roll out of 200 stores on hold for 6 months.
So the lesson is simple - make sure that every new market is researched fully. It doesn't naturally follow that the same format will work in all.
Tuesday, 17 February 2009
Gloom, doom and despondency. Where is the positivity?!
The snow. The blizzards. The cold. And then the rain.
The grey skies day after day. Postcards from someone 'sunning it up' in the Caribbean - wish you were here .... if only....
Gordon Brown. Miserable as hell. England lose the Football, Cricket and Rugby. More snow, rain and wind. And then Darling telling us the economy is as bad as it's been for 100 years. Let's emigrate!
Then on Monday morning the rain stopped, the temperature rose and the sun shone. I noticed that dawn was suddenly earlier. It felt as if Noah had got out of his boat. In a funny sort of way it felt that things may get better.
I know not a lot has changed in the news, but positiveness is so important - personally and in business. We need that 'positive' factor back; that 'can do' attitude, and if the oncoming Spring and change of weather can put a 'spring' into our step, then that can only be a good thing.
The grey skies day after day. Postcards from someone 'sunning it up' in the Caribbean - wish you were here .... if only....
Gordon Brown. Miserable as hell. England lose the Football, Cricket and Rugby. More snow, rain and wind. And then Darling telling us the economy is as bad as it's been for 100 years. Let's emigrate!
Then on Monday morning the rain stopped, the temperature rose and the sun shone. I noticed that dawn was suddenly earlier. It felt as if Noah had got out of his boat. In a funny sort of way it felt that things may get better.
I know not a lot has changed in the news, but positiveness is so important - personally and in business. We need that 'positive' factor back; that 'can do' attitude, and if the oncoming Spring and change of weather can put a 'spring' into our step, then that can only be a good thing.
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