Do price deals bear comparison?
It’s only eighty or so days until Christmas. Things are cranking up; the tinsel is already in the stores and distributors are taking on thousands of seasonal staff as we get ready to splurge online. While internet shopping is an undoubted convenience for the likes of me who tend to do a lot of last-minute purchasing, the pitfalls are nonetheless plentiful.
Advice from trading standards is to read websites carefully. If something looks too good to be true, then it probably is. Also bear in mind that scammers put a lot of effort into putting counterfeit goods in totally authentic packaging. But even buying the genuine article can carry a sting. You find a sale item that beats the nearest competitor by a tenner. Then you click on the ‘add to basket’ button only to find that VAT was not included and that delivery is another £6.99 on top. A few people I know swear by price-comparison websites. Personally, I’ve always had my doubts that these services actually secure the best possible deal.
It turns out that the Competition and Markets Authority (CMA) have the same misgivings. They will be looking at how sites such as Moneysupermarket, Uswitch and GoCompare can be trusted to provide value for money.
The CMA also says it will consider whether consumers should have its spelled out as to how sites earn their commission. This aspect is not surprising as the Authority took a lot of stick a while ago for controversially ruling that firms were no longer obliged to highlight the cheapest deals.
Now they intend to examine broadband, energy, insurance and banking sectors and decide if we punters actually get a decent shout.
Companies cough up around £30 for each new customer they get online. Retail pundits are reasonably sure this amount gets whacked onto product prices elsewhere along the transaction chain.
For myself, I rather hope the CMA also take in interest in the way energy companies bar their own customers from many of the best available deals for gas and electricity. A recent report claims that firms ensure the cheapest offers only go to new customers while existing users are offered more expensive packages.
As such there’s more than a drop of irony in the statement by one energy provider who reckons the CMA is “clueless as to how comparison sites are profit-making machines posing as consumer champions”.
Despite record low inflation, it’s not a great time to be a consumer. Stealth taxes, like those affecting insurance premiums, are on the increase.
Added to that, interest rates on savings accounts with most High Street banks will drop from 0.25% to 0.05% come December.
Even so, retailers are preparing for “robust spending” as shoppers seek seasonal bargains.
The CMA has six months to decide if the price-comparison business represents the kind of rip-off that is claimed. They then have a further year to publish a report.
Doing the business over rates?
Revaluations are seldom good news in business but last week’s announced changes affecting rateable values understandably caused quite a few smiles.
Rateable values, broadly speaking, represent a notional idea of how much a firm would expect to pay in annual rent. That figure is then subject to a "multiplier", set by government, which determines the Business Rates bill.
The problem is that these values and the multipliers have become a bit meaningless in the face of falling commercial prices. For example, a colleague recently told me about a shop in Woodfield Street in Morriston where the commercial rent is £8,000 a year but the business rates are more than double that amount. Ludicrous.
This burden is now to be lessened but it’s not all good news. Winners and losers include local authorities, some of which will see income rise as a result of the changes; others will see it plummet.
Gateway development needs backing
I’ve never made a secret of my puzzlement as to how the view of Swansea council who commissioned the Parc Tawe retail complex back in the eighties switched to regarding it as a threat to the city centre rather than a gateway.
City planners will today decide if the proposed revamp gets the green light. I’m not going to tempt fate other than say I detect a far more pragmatic approach these days.
If approved, the application will see smaller units introduced with the featureless interconnecting corridors demolished. The awful frontage facing Fabian Way is to get a makeover too.
It’s good to see Swansea Bay Business Club taking a proactive stance in backing the development and recognising that the upgrade can be a part of a wider retail renaissance for the city.
The bottom line is that getting shoppers back into the habit of visiting Parc Tawe – instead of Parc Trostre – is in every Swansea trader’s interest.