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The UK retail trade is calling on the government to come up with a “credible growth strategy” now the economy is in a double-dip recession.

Figures out today showed the UK economy has returned to recession, after shrinking by 0.2% in the first three months of 2012.

The British Retail Consortium (BRC) said the UK’s return to recession was “a blow to the retail sector at a time when a boost to consumer confidence is desperately needed”.

The BRC has previously warned that temporary bright spots, such as last month’s retail sales figures, cannot disguise the “fundamental difficulties faced by households and businesses”.

With inflation growing at almost three times the rate of average wage increases and personal budgets under pressure from high fuel and utility bills, consumers have continued to cut back on many areas of spending, said the BRC.

BRC director general Stephen Robertson said: “2012 looks like being tougher than we thought. The figures are subject to revision but the UK’s return to a technical recession is a blow.

“Whether GDP growth is just above or just below zero doesn’t change the harsh realities facing customers but it will undermine confidence at a time when we desperately need to be going forward not backwards.

“Sunshine helped the retail sector in March and left these GDP figures less negative than they would have been but that cannot disguise the fundamental difficulties faced by households and businesses.

“Consumers are struggling to balance their budgets. We won’t see a convincing revival until real wage growth returns but last month’s increase in inflation suggests the squeeze on disposable incomes will continue.

“If it’s to rekindle recovery the government must deliver a credible growth strategy. It should halt its tsunami of destructive new regulations and taxes. They are adding costs to individuals and households and can only prolong this new recession.”

Source: BRC

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Morrisons is introducing a new selection of salads that include a range of “highly nutritious superfoods”.

The retailer is undertaking the first revamp of its in store salad bar in 15 years, with a total of 14 new lines and 20 that have been improved.

One of the new “nutritious options” that has been brought in-store is a “super salad”, which includes cranberries, edamame beans and black.

Customers will be introduced to an “exotic new taste” with the Moroccan spiced carrot salad, which combines bulgar wheat, apricots and sultanas to create an African- style salad.

A summery treat will arrive at Morrisons salad bars with the addition of an oriental slaw, which includes pink star cabbage, carrot, spring onions, peppers and courgette in an oriental vinaigrette dressing.

Morrisons executive chef and head of innovation Neil Nugent said: “Our customers are constantly looking for new and exciting twists to their salads, whether it’s for a lunchtime snack or as part of a larger evening meal.”

Source: Morrisons

Sportswear retailer Sports Direct has reported that fourth quarter sales in the nine weeks to 25 March have exceeded management expectations.

Group total sales in the period rose 13.2% to £267.6 million year-on-year while gross profit was up 13.5% to £99.8 million. This compares with a third quarter rise of 9.1%.

Dave Forsey, chief executive, said: "This performance continues to be primarily through the UK division where online sales now represent an even larger proportion of our total retail sales than envisaged at our Interim Results in December 2011."

Retail division sales for the period increased 16.1% to £232.6 million and there was 15.1% rise in retail gross profit to £85.4 million. This does not include sales and gross profit from the newly formed Premium Lifestyle division.

Sports Direct said back in February that it would reach its full year targeted underlying EBITDA of £215 million, before bonus scheme costs, and its "super-stretch" scheme target of £225 million. As a result, the company will be seeking shareholder approval at the 2012 Annual General Meeting for a Super-Stretch Executive Bonus Share Scheme for Mike Ashley, the Company’s executive deputy chairman.

The scheme proposes a grant of 8 million shares to Ashley, which will vest in 2018 if performance criteria are met.

"We remain positive about the group’s outlook and are excited about the summer ahead with the Diamond Jubilee, Euro 2012 and the London Olympics," Forsey said.

source: www.theretailbulletin.com

Apple said its net profit came in at $11.6bn (£7.2bn), up from $6bn in the same period last year and much better than had been expected.

The technology giant sold 35 million iPhones in the quarter, which was also almost double the level from a year ago.

Apple shares rose more than 7% to $601 in after-hours trading.

To put its results in perspective, Apple’s profits are now more than Google’s quarterly revenues of $10.65bn.

Microsoft, the world’s largest software firm, has quarterly revenues of about $17bn.

Google and Microsoft make Android and Windows Phone respectively, which are rivals to Apple’s iOS platform.
‘Blowout quarter’

“Apple had a blowout quarter,” said JJ Kinahan, a strategist at TD Ameritrade. “There were already high expectations and they blew the expectations away.”
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You can converge a toaster and a refrigerator, but those things are probably not going to be pleasing to the user”

Chief executive Tim Cook, speaking on the conference call, said that almost 67 million iPads had now been sold - it took the company 24 years to sell as many Mac computers and three years to sell that many iPhones.

“The new iPad is off to a great start, and across the year you’re going to see a lot more of the kind of innovation that only Apple can deliver,” he said.

The strong results followed a 13% fall in its share price in the past few weeks.

Some analysts had predicted that iPhone sales would be weak, suggesting that phone companies had reined in their sales.

“We’re thrilled with sales of over 35 million iPhones and almost 12 million iPads in the March quarter,” said Mr Cook.

Apple now has $110bn in cash. In March, the tech giant said it would use its cash to start paying a dividend to shareholders and to buy back some of its shares.

It expects to use $45bn over the next three years.

Apple’s shares recently touched a high of $644, surpassing $600bn in market value and affirming its position as the world’s most valuable firm.

The iPhone maker’s shares were worth as little as $3.19 in 1997, when it faced the possibility of bankruptcy.

source: www.bbc.co.uk

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The Association of Convenience Stores (ACS) has urged retailers to check and upgrade their systems to prevent under-age sales, as changes to licensing laws introduced today (25 April) increase the powers of local authorities to review or revoke alcohol licences.

The changes taking effect include:

a reduced evidence threshold to undertake a review of a licence that may lead to additional licensing conditions or the revocation of a licence;
the removal of the vicinity test, which will mean that objectors to an existing or new licence will not have to live or work near that premises;
licensing authorities and public health agencies becoming responsible authorities, which will mean they can raise objections to a licence;
an increase in the maximum fines that can be levied to £20,000.

ACS chief executive, James Lowman, said: “From today, it will be harder to get and keep an alcohol licence. Best practice in preventing under-age purchases is now essential for businesses who want to safeguard their future.

“These changes also highlight the importance of forging links with local decision-makers. Your local licensing officer, police, Councillors and health agencies need to know that you are a responsible retailer and a force for good in the community, so you need to tell them loud and clear.”

ACS is working with the government on its Alcohol Strategy, which contains further challenges for retailers including restrictions on multi-buy promotions, the introduction of public health as a licensing objective, and the introduction of cumulative impact policies to control the number of licences in an area. ACS has also submitted evidence on the introduction of Early Morning Restriction Orders (EMROs) and the Late Night Levy, both of which seek to limit the impact of premises open late at night.

Source: ACS

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Family spending power fell by £10 a week in March 2012 – reversing the improving trend seen in recent months, according to the latest Asda Income Tracker.

This left the average UK family with £144 of weekly disposable income, 6.5% down from the same time last year.

The official measure of the rising cost of living was up in February, as the consumer price index (CPI) rose over the year by 3.5%, well above average earnings growth which remained weak at just 1.6%. When slow income growth is added to high inflation on the cost of basics, it’s clear that family spending power is being squeezed in both directions, resulting in disposable income levels eroding further, said Asda.

As well as those that are in work seeing small year-on-year salary increases, well below inflation, tough conditions in the labour market mean unemployment is still having an impact despite slight year-on-year improvements in the headline rate. Balancing the two conflicting elements, family income growth is still very fragile, with the improving cost of basics overshadowed by the high number of workers becoming unemployed.

Despite some recent improvements in the cost of utilities and transport with a drop in wholesale prices and energy providers making cuts to bills in March, they are still two of the main factors putting pressure on discretionary spend. The cost of electricity and gas remains well above that of last year and are rising again by 8.1 and 16.1 respectively in March. Petrol and diesel prices by 4.2% and 4.7% respectively over the year, with prices at the pump hitting an all-time high during the month.

Spare cash is also declining year-on-year across every UK region, with annual drops remaining severe in the first quarter of the year. The north-west of England saw strongest pressure on family budgets over the past year – with employment conditions in the region reducing spending power. Northern Ireland continues to suffer steep declines, with the cost of essentials making up a larger proportion of family budgets, and therefore most impacted. Families in the province had just £83 a week of discretionary income in Q1 2012 – just over half that of the national average.

London and the south-east fared relatively well over the first quarter, with essential spending making up a smaller proportion of household budgets. Discretionary spend in London was £184 per week in Q1 2012, compared to a UK average of £144, and four times higher than cash available to families in north-west and Northern Ireland. This gap continues to widen, demonstrating the difference in economic challenges faced by families across the UK.

Andy Clarke, Asda president and CEO, said: “It’s worrying to see the cost of essentials creeping back up, increasing the demands on family budgets and putting pressure income growth.

“Unemployment drove the continued drop in disposable income in March and throughout the quarter, with a growing divide between the nations and regions.

“We’re firm in our commitment to help tackle this in 2012, by creating new jobs, working with new communities and bringing Asda value where it matters most to families across the UK.”

source: www.talkingretail.com

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Asda will this summer become the latest business in the UK to introduce contactless payments in partnership with Streamline and Visa Europe. The new contactless payment option will be available across 25 stores from July onwards.

The contactless technology means some Asda customers will be able to “simply tap the reader” with their contactless enabled card, and pay in less than a second when making payments of up to £15 (rising to £20 from 1 June). The technology is expected to reduce queues, especially during peak periods.

The deal will see Asda capitalise on the growing popularity of contactless technology. Today there are around 20 million contactless cards in circulation in the UK, with a total of 30 million anticipated by the end of 2012.

Matthew Rowsell, chief commercial officer at Streamline, said: “This partnership is the latest step in the contactless revolution that we’re seeing right across the UK. Bringing Asda on board reinforces how popular and necessary contactless has become. Streamline is committed to keeping retailers up to date with the latest industry and consumer trends, with ongoing support and guidance in implementation.”

Mark Austin, head of contactless at Visa Europe said: “The rollout of contactless technology by organisations like Asda is helping to set the scene for a major change in the way we pay. We’re excited to be working with partners across the industry and remain committed to the rollout of Visa payWave to match the ever increasing uptake of Visa contactless cards by British consumers.”

Source: Streamline/Visa Europe

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Asda will this summer become the latest business in the UK to introduce contactless payments in partnership with Streamline and Visa Europe. The new contactless payment option will be available across 25 stores from July onwards.

The contactless technology means some Asda customers will be able to “simply tap the reader” with their contactless enabled card, and pay in less than a second when making payments of up to £15 (rising to £20 from 1 June). The technology is expected to reduce queues, especially during peak periods.

The deal will see Asda capitalise on the growing popularity of contactless technology. Today there are around 20 million contactless cards in circulation in the UK, with a total of 30 million anticipated by the end of 2012.

Matthew Rowsell, chief commercial officer at Streamline, said: “This partnership is the latest step in the contactless revolution that we’re seeing right across the UK. Bringing Asda on board reinforces how popular and necessary contactless has become. Streamline is committed to keeping retailers up to date with the latest industry and consumer trends, with ongoing support and guidance in implementation.”

Mark Austin, head of contactless at Visa Europe said: “The rollout of contactless technology by organisations like Asda is helping to set the scene for a major change in the way we pay. We’re excited to be working with partners across the industry and remain committed to the rollout of Visa payWave to match the ever increasing uptake of Visa contactless cards by British consumers.”

Source: Streamline/Visa Europe

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Asda has cut 2p a litre from the price of both unleaded petrol and diesel, the first fall in prices in 2012.

A drop in global oil prices and the strengthening of sterling against the US dollar have reduced wholesale costs, enabling the supermarket to pass those savings on to hard pressed motorists.

Drivers filling up at any of Asda’s 195 forecourts nationwide will pay no more than 138.7p per litre for unleaded and 143.7p per litre for diesel.

Andy Peake, Asda’s director of petrol trading, said: “We’re committed to doing everything we can to help lower the cost of living for our customers, and today’s move shows that Asda is once again leading the way in reducing the price at the pump.

“Unlike other retailers, our price cuts benefit everyone across the country, meaning that no-one filling up at Asda will be forced to pay a premium for their fuel.”

Asda said research taken from PetrolPrices.com showed some retailers were getting away with charging up to 8p per litre more in towns without an Asda nearby.

source: www.talkingretail.com

The report by Premier Tax Free found that visitors to Glasgow came top, spending 175% more in December 2011 than in December 2010. Americans made up the majority of the rise, increasing their spending in the city by more than 290%. Chinese visitors spent 180% more and visitors from the UAE 83% more. In comparison tourist spending in London and Manchester increased by 35% and in Edinburgh by 31%.

In London tourists typically spent £428 per sale in December. The report found that spending by Norwegians increased the most from 2010, with the nation spending 74% more. Spending by Qataris and Kuwaitis increased by 44% and 41% respectively while Americans spent 36% more.

December also showed some distinct tourist trading peaks in London. The most intense spending occurred between 23 and 31 December with 33% of total value. This is up 50% from the same period in 2010.

The biggest tourist spending day was Boxing Day, accounting for 5% of total tourist spending in the capital. This was 90% more than the same day in 2010, with a typical transaction value of £302.

Lebanese tourists took the greatest advantage of the sales, spending the most per transaction on Boxing Day at £1,225. They were followed by Saudi Arabians who spent £460 per sale.

The traffic free shopping days in London’s West End on 10 and 11 December also had a positive impact on tourist sales accounting for 5% of the total value of transactions over the month. In general, tourists spent £414 per transaction over the weekend, with those from Indonesia spending the most per transaction, at £1,473.

Duncan Bews, director of sales at Premier Tax Free said: “It is very encouraging to know that tourists are flocking to the UK to spend their money. These figures demonstrate how valuable the tourist industry is, especially over peak shopping periods.”

He added: “In addition, these numbers show no signs of slowing down. Retailers need to make the most of visitors to the UK eager to take advantage of the lower pound. Those that convert the additional 20% tourists can claim back through tax free shopping into sales can make substantial gains.”