I’ve puzzled for a few days how to wrap up the first year of this blog.
The answer's easy, though.
With a thank-you, of course, because 4,880 of you have taken a peek and had a read (or a laugh) at what I’ve had to say.
The biggest audience by far has been in the UK, with useful chunks coming from the USA, Germany and France. So the transatlantic alliance is alive and well and relations with Europe weren’t completely trashed by the Cameron V Sarko bust-up.
I’d also like to say thank you to some regular readers in Russia, India, Hungary and Singapore, and some welcome attention from Brazil and Canada.
What have you been reading? The single most-visited post was ‘Champagne, Chips and property development’, some thoughts about the Invest in Nottingham Club’s London day (and the champagne and chips I had at St Pancras).
But even that was dwarfed by the three posts which followed Westfield’s bombshell decision to sell Nottingham’s Broadmarsh shopping centre on the eve of a planned £450 million redevelopment. I’ll have a few more snippets on that in January.
Various observations on the economy, notably about oil prices, inflation, employment trends and public sector job losses, also appeared to go down well.
Well, I hope they did anyway. I’ve tried to shed light on a mix of major business-related issues in Nottingham and get underneath what seem to me some misleading analyses of where our economy is at.
Once again, I’ll have more to say on that shortly and it won’t all be depressing.
One of the lessons I’ve learned over the years in business journalism is that people who own and run businesses can get really fed-up of clichéd representations of what they do, and don’t regard one set of bad numbers as reason to give up and go home.
So ‘leaps’ in this number or ‘plunges’ in that might make today’s headlines but they tell you little about economic reality. Rifling through the Office for National Statistics website, you soon discover that some of these leaps and plunges aren’t leaps and plunges at all.
Similarly, the biggest beef for me at the moment is the lack of long-term perspective in some reporting of our economic predicament. Yes, we are going through an unprecedented economic crisis, but we are doing so during a period of unprecedented wealth and health. So, buddy, I can still spare you several dimes.
Whether its Christmas, the holidays, Hanukkah or just another day at the office, have a good one.
Wednesday, 21 December 2011
Thursday, 15 December 2011
Eon or eeyore?
More consumer misery...
I take a call on my mobile from someone who says he is from the energy firm E.on. It goes something like this:
He begins: “Is that Mr Baker?”
Me (wearily): “Who is this?”
Him: “I’m from the customer winback team at E.on, and as a valued former customer...”
Me: “I’ve never been a customer of E.on.”
Him: “Oh, is that right? Well, I just wondered if you could tell me who your energy supplier is at the moment ‘cos I want to talk to you about some special deals...”
Me (even more wearily): “Do you seriously think I’m interested in doing business with someone who cold-calls me, on my mobile, at work, and tells me I’m a former customer when I’m not?”
Him, laughing: “Oh, okay, then. See ya.”
Dismal.
I take a call on my mobile from someone who says he is from the energy firm E.on. It goes something like this:
He begins: “Is that Mr Baker?”
Me (wearily): “Who is this?”
Him: “I’m from the customer winback team at E.on, and as a valued former customer...”
Me: “I’ve never been a customer of E.on.”
Him: “Oh, is that right? Well, I just wondered if you could tell me who your energy supplier is at the moment ‘cos I want to talk to you about some special deals...”
Me (even more wearily): “Do you seriously think I’m interested in doing business with someone who cold-calls me, on my mobile, at work, and tells me I’m a former customer when I’m not?”
Him, laughing: “Oh, okay, then. See ya.”
Dismal.
Wednesday, 14 December 2011
Mary Portas on retail: The future isn't the past
Mary Portas’ 55-page review into the future of Britain’s failing High Streets can be summed up in seven words: The future doesn’t lie in the past.That reality is that supermarkets and shopping centres have thrived because they offered something which High Streets shaped by another era were always going to struggle with. The days when shoppers could park on the street and meander from shop-to-shop were dying as long ago as the 1960s and 1970s.
From the 1980s onwards, the writing has been on the wall: people leading increasingly busy lives have been looking for four key criteria from their retail experience – convenience, value, speed and an experience (as opposed to a simple transaction). Supermarkets, shopping centres and websites easily tick those boxes. High Streets don’t
Yet planning policies and councillors on planning committees have persisted in trying to preserve an economic model which fractured long ago. I’ve heard many a councillor say that they don’t want a big supermarket on their doorstep because of the damage it might do to local shops.
They should read this one paragraph from Mary Portas’ report:
“The phenomenal growth of online retailing, the rise of mobile retailing, the speed and sophistication of the major national and international retailers, the epic and immersive experiences offered by today’s new breed of shopping mall, combined with a crippling recession, have all conspired to change today’s retail landscape. New benchmarks have been forged against which our high streets are now being judged. New expectations have been created in terms of value, service, entertainment and experience against which the average high street has in many cases simply failed to deliver. These reasons alone conspire to create a new shopper mindset which cannot and should not be reversed.”
Or to put it more succinctly, shoppers have already left the High Street behind. A policy which seeks to preserve it in its current form is almost certain to prolong its suffering and delay its recovery.
Mary Portas may not be the first person to delve into the future of retailing, but councils would do well to pay particular attention to her investigation because it comes at a critical time – and there is an absolutely crucial difference in her approach.
Where others have carried out academic, economic and planning-based analyses, her report is that of a retailer and consumer. Where others focused on improving process, she started with a simple question: what do shoppers actually want?
They clearly don’t want the High Street to carry on trying to serve up a pale imitation of supermarkets or shopping centres. It therefore has to do something different.
What is that something different? Clues are beginning to emerge. It would be about a mix of uses which may still take in some conventional retail formats, but would also look at services which cannot be delivered online and work better locally, socially useful services (like council departments themselves), residential use, leisure and event-based use.
Councils do need to look long and hard at the continuing relevance some of their policies and consider whether they infact do more harm than good. Refusing a planning application for a particular type of shop because it involves a different use is barking mad if the property stays empty. And surrounding the car-borne consumer with parking restrictions, price rises and traffic wardens is an open invitation to go elsewhere. What value is there in a short-term hike in parking revenues when it contributes to the long-term decline in business rates?
The authorities who impact on the way our High Streets operate have got to take on board the scale of the change that has happened in retail and its whirlwind speed. Decades ago, shoppers used to trawl the shops and the streets physically looking for ‘bargains’. These days they go on discount websites, receive email alerts and, in some cases, wield smartphones capable of what’s known as Near Field Communication – so the store can ‘talk’ to them when they walk past.
Against that background, sitting in a council chamber and voting to block a supermarket development is like facing a tsunami with a bucket. Or telling consumers they should go back to a time when they had to spend more time looking for a limited variety of goods which cost more.
Your average independent small-town retailer cannot hope to compete with a global, technology-driven onslaught. Mary Portas’ point is that they shouldn’t even try – they should do something else.
That’s where the debate about the future of retailing in Nottingham’s town centres and high streets has to go next.
Wednesday, 30 November 2011
When the A453 speeds up, so will the economy
The reporting of the Chancellor’s Autumn Statement (that’s the mini Budget he said he was getting rid of) has been almost ritually gloomy
Growth worse than forecast, borrowing worse than forecast, cuts worse than forecast, unemployment worse than forecast (that’s enough worse than forecast – ed.)
There are a couple of reasons for the headline gloom-fest. For starters, this is not what George Osborne said would happen, and it lands him in a suspiciously similar position to his political opponent, Nottingham High School old boy Ed Balls. So some would say he is properly being held to account, others that it’s political schadenfreude.
The second reason is that we appear to have a fixation with news agendas:
“I think it’s grim, what do you think?”
“Well, yeah – it does sound grim, doesn’t it?”
“Terrible, pretty grim really.”
Now, it would be a brave person to stand up and suggest anaemic UK growth and the euro zone horror story signal that happy days are here again.
But I’ll try to dial in a little bit of perspective.
Besides a potential hiccup in this quarter and the next (that’s the R-word or the Double-D phrase), the economy is likely to grow a little bit over the next year.
As that’s a national average, some regions of the UK are likely to grow more than others.
The East Midlands looks like it’ll be one of them.
I says that because I saw a piece of research towards the end of last week from the Institute for Public Policy Research which analysed when employment in the regions was likely to get back up to its pre-recession peak.
Some of its research does sound, ahem, grim. Northern regions may not see employment peak again until 2018 or beyond. That’s a lost decade.
But other regions will see it return to the high by 2014. And we’re bracketed together with the south, south east and east of England in this group.
One more point of perspective. Whether it was courage, confrontation or carelessness, the Chancellor chose the day before the public sector pensions strike to announce that these workers could also look forward to pegged pay increases and more job losses.
In total, the Office for Budgetary Responsibility is now estimating that more than 710,000 public sector workers will have lost their jobs by 2017.
In isolation, that’s a huge number. But, as I’ve blogged before, it is a proportionally small part of the economy – of the UK workforce of 30 odd million, 6 million are employed in the public sector. So the job losses would amount to less than 2.5% of our total workforce, and over that length of time at least some of those jobs will be replaced by private sector growth (not as many as George Osborne would hope, though).
Besides the raft of measures aimed at encouraging lending to small and medium-sized businesses, the major headline for us was that we finally appear to have dragged the A453 widening project over the line.
After only 30 years of trying...
This single carriageway link between Nottingham, the M1, East Midlands Airport and the East Midlands Parkway railway station has accurately been described as the biggest car park in Nottingham.
Beyond the jokes, it has cost the local economy millions in delays, and Boots dropped some heavy hints in private that it regarded progress on this project as a factor in future investment – especially after the decision to turn part of its sprawling and under-utilised campus into an enterprise zone.
While we don’t have a definite start date, that project will now begin before 2015, which is earlier than expected. Turning it into a four-lane road should reduce congestion and cut journey times.
More significantly, it is also likely to open up swathes of land for residential and commercial development, and I wouldn’t be in the least bit surprised to see land transactions and planning applications start to shift in this area.
We can’t kid ourselves – it’s going to be slow progress for a while now. We could well have a situation where, when the A453 finally speeds up, so does the economy.
Growth worse than forecast, borrowing worse than forecast, cuts worse than forecast, unemployment worse than forecast (that’s enough worse than forecast – ed.)
There are a couple of reasons for the headline gloom-fest. For starters, this is not what George Osborne said would happen, and it lands him in a suspiciously similar position to his political opponent, Nottingham High School old boy Ed Balls. So some would say he is properly being held to account, others that it’s political schadenfreude.
The second reason is that we appear to have a fixation with news agendas:
“I think it’s grim, what do you think?”
“Well, yeah – it does sound grim, doesn’t it?”
“Terrible, pretty grim really.”
Now, it would be a brave person to stand up and suggest anaemic UK growth and the euro zone horror story signal that happy days are here again.
But I’ll try to dial in a little bit of perspective.
Besides a potential hiccup in this quarter and the next (that’s the R-word or the Double-D phrase), the economy is likely to grow a little bit over the next year.
As that’s a national average, some regions of the UK are likely to grow more than others.
The East Midlands looks like it’ll be one of them.
I says that because I saw a piece of research towards the end of last week from the Institute for Public Policy Research which analysed when employment in the regions was likely to get back up to its pre-recession peak.
Some of its research does sound, ahem, grim. Northern regions may not see employment peak again until 2018 or beyond. That’s a lost decade.
But other regions will see it return to the high by 2014. And we’re bracketed together with the south, south east and east of England in this group.
One more point of perspective. Whether it was courage, confrontation or carelessness, the Chancellor chose the day before the public sector pensions strike to announce that these workers could also look forward to pegged pay increases and more job losses.
In total, the Office for Budgetary Responsibility is now estimating that more than 710,000 public sector workers will have lost their jobs by 2017.
In isolation, that’s a huge number. But, as I’ve blogged before, it is a proportionally small part of the economy – of the UK workforce of 30 odd million, 6 million are employed in the public sector. So the job losses would amount to less than 2.5% of our total workforce, and over that length of time at least some of those jobs will be replaced by private sector growth (not as many as George Osborne would hope, though).
Besides the raft of measures aimed at encouraging lending to small and medium-sized businesses, the major headline for us was that we finally appear to have dragged the A453 widening project over the line.
After only 30 years of trying...
This single carriageway link between Nottingham, the M1, East Midlands Airport and the East Midlands Parkway railway station has accurately been described as the biggest car park in Nottingham.
Beyond the jokes, it has cost the local economy millions in delays, and Boots dropped some heavy hints in private that it regarded progress on this project as a factor in future investment – especially after the decision to turn part of its sprawling and under-utilised campus into an enterprise zone.
While we don’t have a definite start date, that project will now begin before 2015, which is earlier than expected. Turning it into a four-lane road should reduce congestion and cut journey times.
More significantly, it is also likely to open up swathes of land for residential and commercial development, and I wouldn’t be in the least bit surprised to see land transactions and planning applications start to shift in this area.
We can’t kid ourselves – it’s going to be slow progress for a while now. We could well have a situation where, when the A453 finally speeds up, so does the economy.
Thursday, 24 November 2011
Broadmarsh: They think it's all over...it is now
Capital Shopping Centres now owns Nottingham.
Well, in retail terms anyway.
It agreed a deal today to buy the remaining 25% shareholding in Broadmarsh from the Royal Mail Pension Fund. With the 75% it agreed to buy from Westfield for £55m, it means it now has complete ownership of the centre.
For those interested, it paid £18.3m for the pension fund’s 25%. It’s the same quantum as the Westfield price, and probably a premium over the paper value.
The wording of CSC’s announcement, made to the Stock Exchange, is interesting.
CSC had said it wanted to pump £250m into expanding the Victoria Centre, which it already owns. The fear in Nottingham was that this would mean a more ambitious revamp of Broadmarsh – which would also tidy up a massive eyesore on the southern approach to the city – would be sidelined.
Not only that, but the artist’s impressions of what CSC has said it wants to do to the Victoria Centre are, shall we say, quite traditional (and that’s putting it politely
Anyway, this is what David Fischel, CSC’s chief exec, said in today’s announcement:
“CSC is delighted to have acquired this important asset in Nottingham. Common ownership of Victoria Centre and Broadmarsh greatly improves the prospect of transformational retail and leisure led development taking place within the city to the benefit of the local and wider Nottingham community.
“The Victoria Centre has been at the heart of Nottingham for over 40 years and this acquisition further underlines our commitment to the city, which is one of the UK's top ranking retail destinations. We look forward to working with Nottingham City Council on this exciting opportunity.”
That may just be holding back an already familiar deck of cards. Or it could be an olive branch to a City Council which privately has considerable concerns about what CSC may – or may not – do. Or, it could be an indication that, now it’s got two centres, it will revise both plans.
Legal completion of the purchase hasn’t gone through yet, so I doubt we’ll hear a categorical statement of intent until then. CSC will also be discussing its options with the likes of Harvey Nichols, Marks & Spencer, Apple and Hollister, all of whom had agreements of varying status in relation to Westfield’s Broadmarsh redevelopment.
Either way, it’s time for CSC to start talking to Nottingham.
Well, in retail terms anyway.
It agreed a deal today to buy the remaining 25% shareholding in Broadmarsh from the Royal Mail Pension Fund. With the 75% it agreed to buy from Westfield for £55m, it means it now has complete ownership of the centre.
For those interested, it paid £18.3m for the pension fund’s 25%. It’s the same quantum as the Westfield price, and probably a premium over the paper value.
The wording of CSC’s announcement, made to the Stock Exchange, is interesting.
CSC had said it wanted to pump £250m into expanding the Victoria Centre, which it already owns. The fear in Nottingham was that this would mean a more ambitious revamp of Broadmarsh – which would also tidy up a massive eyesore on the southern approach to the city – would be sidelined.
Not only that, but the artist’s impressions of what CSC has said it wants to do to the Victoria Centre are, shall we say, quite traditional (and that’s putting it politely
Anyway, this is what David Fischel, CSC’s chief exec, said in today’s announcement:
“CSC is delighted to have acquired this important asset in Nottingham. Common ownership of Victoria Centre and Broadmarsh greatly improves the prospect of transformational retail and leisure led development taking place within the city to the benefit of the local and wider Nottingham community.
“The Victoria Centre has been at the heart of Nottingham for over 40 years and this acquisition further underlines our commitment to the city, which is one of the UK's top ranking retail destinations. We look forward to working with Nottingham City Council on this exciting opportunity.”
That may just be holding back an already familiar deck of cards. Or it could be an olive branch to a City Council which privately has considerable concerns about what CSC may – or may not – do. Or, it could be an indication that, now it’s got two centres, it will revise both plans.
Legal completion of the purchase hasn’t gone through yet, so I doubt we’ll hear a categorical statement of intent until then. CSC will also be discussing its options with the likes of Harvey Nichols, Marks & Spencer, Apple and Hollister, all of whom had agreements of varying status in relation to Westfield’s Broadmarsh redevelopment.
Either way, it’s time for CSC to start talking to Nottingham.
Wednesday, 23 November 2011
Is High Pay Commission really tuned into business growth?
I blogged a few weeks back about the High Pay Commission, and it was in the news again over the past couple of days.
If you don’t want to track back through the link, here’s the resume: the High Pay Commission isn’t a Commission in the normal sense of a heavyweight, government-sanctioned probe into a matter of major concern. It’s a one-year project funded by a left-leaning think tank which wants to influence government policy. So the name’s a bit of a fib.
And though it is clearly all about what goes on in the upper reaches of stock market businesses, it doesn’t involve any business people. This Commission’s members are academics and a couple of well-connected London journalists.
The Commission’s mission is written all over its name: a belief that senior executives get paid way more than most, and probably don’t deserve it.
It’s in the news again this week because it has published its final report. It finds that executives right at the top of big stock market firms enjoyed pay rises which disappeared into space, compares that to the less-than-stellar performance of their businesses, and wants other people to have a say in executive pay in future. So no surprises really.
I’d be amazed if anything happened, though, for three reasons.
One is that a government grappling with no growth probably has neither the time nor the inclination to launch into an issue which risks being portrayed as dis-incentivising businesses at the cutting edge of the economy (indeed, Business Secretary Vince Cable has already kicked the Commission’s proposals into the long grass by saying government will look at some proposals next year).
Secondly, some of them sound like Utopia-meets-the-boardroom. The idea that any business would want employees sitting on a committee voting on a proposal about how much the boss gets paid is unrealistic. Why not stop there: we could have selected employees also voting on the sales strategy, couldn’t we? No, actually – it would be stupid.
Finally, while reining in top pay might make ordinary people feel good it will do nothing to make them wealthier. The answer to that is enabling economic growth, not disabling executive pay.
And this is the beef with the High Pay Commission. It’s an entirely London-centric concept: backed by a London think tank, run by people based in London and focusing on a small part of the business universe which is centred on London.
It seems to think silly salary packages doled out by global enterprises should be a big issue for the UK government. But is this really where the action's at?
As I said in the earlier blog, many ordinary business people have no more time for the PLC world than the High Pay Commission does. They think it’s too short-term, and have little respect for stock market chief executives or their jackpot pay packets.
But they don’t lose sleep over it. The big issue for them is the continuing inability of government to act like it gets SMEs – the real bedrock of the economy – on any level.
If it did, there would be fewer rules and regulations, cleverly-targeted tax incentives, better access to finance, and a serious effort to solve the continuing problem of school and college leavers who don’t understand what it takes to hack it at work.
The High Pay Commission’s proposals simply do not register on the radar of key business concerns.
But perhaps they weren’t meant to. Protests not so very far away from the Stock Exchange (and mirrored in Nottingham’s own Market Square) have been making a lot of noise about inequality and unfairness. The Occupy movement is anchored in a belief that capitalism, having landed us all in the soup, is just carrying on like it’s someone else’s problem.
Against that background, PLC bosses paying themselves fortunes according to obscure formulae which seem to come up trumps whatever the weather hardly seems like the stuff of civil society.
So the High Pay Commission is not divorced from reality. It makes some powerful points about the relationship between attainment and reward and public companies’ obligation to fairness.
But the anti-big business rhetoric we see so much of these days is in danger of obscuring a greater truth: that the vast majority of businesses simply aren’t like that, and that it is these businesses that our economic recovery hinges on.
I said in another blog that we were in an era where business has to work a whole lot harder to win public respect, and might start by pointing out the huge contribution it makes to the wealth and wider wellbeing of the communities we live in (don’t forget that 80% of jobs are in the private sector).
If it did, then may be London think tanks would think beyond PLC pay packets when they ponder the best way for business to bring wealth to a wider audience.
If you don’t want to track back through the link, here’s the resume: the High Pay Commission isn’t a Commission in the normal sense of a heavyweight, government-sanctioned probe into a matter of major concern. It’s a one-year project funded by a left-leaning think tank which wants to influence government policy. So the name’s a bit of a fib.
And though it is clearly all about what goes on in the upper reaches of stock market businesses, it doesn’t involve any business people. This Commission’s members are academics and a couple of well-connected London journalists.
The Commission’s mission is written all over its name: a belief that senior executives get paid way more than most, and probably don’t deserve it.
It’s in the news again this week because it has published its final report. It finds that executives right at the top of big stock market firms enjoyed pay rises which disappeared into space, compares that to the less-than-stellar performance of their businesses, and wants other people to have a say in executive pay in future. So no surprises really.
I’d be amazed if anything happened, though, for three reasons.
One is that a government grappling with no growth probably has neither the time nor the inclination to launch into an issue which risks being portrayed as dis-incentivising businesses at the cutting edge of the economy (indeed, Business Secretary Vince Cable has already kicked the Commission’s proposals into the long grass by saying government will look at some proposals next year).
Secondly, some of them sound like Utopia-meets-the-boardroom. The idea that any business would want employees sitting on a committee voting on a proposal about how much the boss gets paid is unrealistic. Why not stop there: we could have selected employees also voting on the sales strategy, couldn’t we? No, actually – it would be stupid.
Finally, while reining in top pay might make ordinary people feel good it will do nothing to make them wealthier. The answer to that is enabling economic growth, not disabling executive pay.
And this is the beef with the High Pay Commission. It’s an entirely London-centric concept: backed by a London think tank, run by people based in London and focusing on a small part of the business universe which is centred on London.
It seems to think silly salary packages doled out by global enterprises should be a big issue for the UK government. But is this really where the action's at?
As I said in the earlier blog, many ordinary business people have no more time for the PLC world than the High Pay Commission does. They think it’s too short-term, and have little respect for stock market chief executives or their jackpot pay packets.
But they don’t lose sleep over it. The big issue for them is the continuing inability of government to act like it gets SMEs – the real bedrock of the economy – on any level.
If it did, there would be fewer rules and regulations, cleverly-targeted tax incentives, better access to finance, and a serious effort to solve the continuing problem of school and college leavers who don’t understand what it takes to hack it at work.
The High Pay Commission’s proposals simply do not register on the radar of key business concerns.
But perhaps they weren’t meant to. Protests not so very far away from the Stock Exchange (and mirrored in Nottingham’s own Market Square) have been making a lot of noise about inequality and unfairness. The Occupy movement is anchored in a belief that capitalism, having landed us all in the soup, is just carrying on like it’s someone else’s problem.
Against that background, PLC bosses paying themselves fortunes according to obscure formulae which seem to come up trumps whatever the weather hardly seems like the stuff of civil society.
So the High Pay Commission is not divorced from reality. It makes some powerful points about the relationship between attainment and reward and public companies’ obligation to fairness.
But the anti-big business rhetoric we see so much of these days is in danger of obscuring a greater truth: that the vast majority of businesses simply aren’t like that, and that it is these businesses that our economic recovery hinges on.
I said in another blog that we were in an era where business has to work a whole lot harder to win public respect, and might start by pointing out the huge contribution it makes to the wealth and wider wellbeing of the communities we live in (don’t forget that 80% of jobs are in the private sector).
If it did, then may be London think tanks would think beyond PLC pay packets when they ponder the best way for business to bring wealth to a wider audience.
Friday, 18 November 2011
If only this was Broadmarsh
But I’m afraid it won’t.
What you see above is a design produced by the Newark-based architect Benoy for a one million square foot retail development in Guangzhou, China.
Drawn up by Benoy design director Sarah Lee, it is inspired by some of the world’s major central parks, the flowing lines wrapping round an open space and linking up to a transport interchange.
This is an inspiring global landmark designed by a Nottinghamshire firm.
The tragic irony is that though we clearly have the talent to produce design which wins awards on the global stage, there appears to be no appetite to follow that path here.
The reverse, infact.
Where the Chinese are signing up to ambitious, ground-breaking schemes which win plaudits before they’re even built, Capital Shopping Centres would like to bolt a big brick box on to the end of the Victoria Centre.
The UK’s fifth biggest retail destination outside London has surely got to do better than this:
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