Your Weekly Commercial Awareness Update – w/c 14th January

Your Weekly Commercial Awareness Update – w/c 14th January

Your round-up of the stories that you should discuss at interview this week:

Marks & Spencer to shut 17 more stores

Reported by Rui Ci Lee

Marks & Spencer announced in November 2016 they intends to close 100 stores by 2022 as part of its 5-year plan. They have further commented on 15th January 2019 proposing to close 17 stores including Ashford, Huddersfield and Hull.

To date, 30 stores across the country have been closed with a further 8 being named earlier. While the closure programme has affected 1,891 employees, as well as the latest plans affecting a further 1,045, there is not much justification for the retailer to continue operating a large number of stores across the country.

In the face of heightened competition from discounters such as Aldi, Lidl, and Primark, it is crucial for the company to reduce its expenses in order to remain profitable without compromising the value of goods delivered to customers.

The rise in online retailers and changing consumer behaviour to shop online have also compelled the company to shift one-third of its business online.

Like many retailers, Marks and Spencer’s performance over the 2018 Christmas holiday period was less than satisfactory.

The retailer’s like-for-like sales, which omits the impact of new stores on its sales performance, was down by 2.2%. Food sales fell by 2.1% and the clothing and home sales division decreased by 2.4%.

Read more at the BBC.

Inflation at one of it's lowest levels

Reported by Zara Smith 

Inflation in the UK dipped to one of its lowest levels in December 2018, where it was 2.1% The rate was at 2.3% in November, so it was a stoop drop in the space merely a month.

This can be beneficial for us consumers; petrol prices have dropped over the previous few months. The cost of a litre of petrol fell by 6.4p between November and December 2018; it should not be on its way to another large increase.

A senior economics analyst, Stephen Clarke, stated that the easing of inflation over the last few months provides a “welcome relief to households amid wider economic uncertainty”.

The decline of inflation is very close to the Bank of England’s 2% interest rate. It is hoped the rate will remain at a steady pace until Brexit issues have been resolved and the Bank of England will then further consider interest rates.

Mike Hardie, head of inflation at the ONS, stated “Inflation eased mainly due to a big fall in petrol, with oil prices tumbling in recent months.

Air fares also helped push down the rate, with seasonal prices rising less than they did last year. These were partially offset by small rises in hotel prices and mobile phone charges.”

Factors such as reduced prices of clothing and less expensive air and sea travel have helped to reduce inflation. Clothing stores had extremely low-price reductions over this previous Christmas period to entice customers away from the competitor retailers.

It has been noted that Brits are being more cautious when spending until the Brexit uncertainty has been resolved, but the reduce in inflation should help Brits with these goals.

For more information, read here.

New Mental Health changes heavily criticised

Reported by Paige Waters

The Law Society, mental health charities and Labour have accused the Department of Health and Social care of rushing through the legislation which would lead to the removal of independent scrutiny of the monitoring process which was placed to ensure that residents were not subjected to excessive restrictions.

The government has been warned that the changes made to the mental health safeguards are granting care home managers and private hospitals far too much power.

The safeguards were intended to protect hundreds of thousands vulnerable people. However, it is now in dispute whether they are effective and sufficient in achieving this purpose.

There is an extremely huge backlog of uncompleted applications for deprivation of liberty safeguards which has led to as many as 125,000 children and adults being unlawfully detained in England and Wales.

Although it has been heavily criticised, the Department of Health has rejected the criticism while insisting that care home managers would be prevented in future from completing its new “streamlined” assessments. They have estimated to remove the bag log of the deprivation of liberty safeguards, it would cost 2 billion.  

Sheree Green who chairs the Law Society’s mental health and disability committee has commented on the matter, stating: “the government’s bill is quite different to the one produced by the Law Commission. The bill placed responsibility on the care home manager to do the Deprivation of Liberty Safeguards or ‘liberty protection safeguard’ work, as it will in future be known.”

“So the care home would be responsible for assessments and deciding whether ti was necessary or proportionate option. You are making the person depriving the patient of liberty as essentially the gatekeeper.”

Find out more here.

What if a car could save both lives and money?

Reported by Emma Ducroix

Since April 2018, the fact to buy a car meant to buy an emergency system, the eCall (abbreviation for Emergency Call). This European initiative could bring rapid assistance to motorists involved in a collision wherever they are within the “golden hour”.

The new vehicle is equipped with sensors which provide the exact location via satellite in a European standardised format. Sensors constitute a help when an accident occurs in order to transmit all the circumstances information by satellite to authorities. Actually, even if no one in the car is able to speak, a « Minimum Set of Data » is sent.

This technology aimed to reduce significantly the time it takes to get to the accidents’ scenes and it will have a lot of results in the countryside particularly. In rural areas, eCall could, as an estimation, speed up emergency response times until 50% which is consequent in order to save a life.

eCall is automatically activated in case of an accident but the conductor of a non-damaged vehicle could push a specific button if he is a witness of an accident not far from it.

If eCall do his best, it could reduce the average of around 25,000 death by road accidents in Europe each year, and, road traffic accident victims who sustain life-changing injuries.

In fact, it is necessary to notice that, after an accident, a human being could be under the shock and couldn’t do everything exactly right whereas an informatics system as eCall could do it.

It would be a step up to save life but, in a commercial (point of) view, as Fernández-Wyttenbach says: “more than 25 billion euros per year would be saved.” So, a quicker response could save life, money and reduce the severity of injuries.

This technology is generating business opportunities for European firms. Actually, NavCert, an SME based in Munich funding it tests and certifies the system and its components. The company’s Managing Director Martin Grzebellus says eCall has become a core part of the NavCert’s business and that “the next big thing today is automated driving which is exactly to know where the vehicle is, and that’s exactly how we support the automotive industry today. »

Present in all new cars types sold since the 1st April 2018, eCall could help prevent 2,500 road deaths and save an economic burden of around €130 billion in costs to society every year.

In addition, the estimated cost of eCall devices of less than €100 per vehicle at the date of entry into force of the proposed regulation does not seem very high.

Moreover, this cost is expected to decrease even further in the future, following cost trends for electronic components and also due to economies of scale.

Find out more here.

Glasgow City Council agrees settlement in 12-year equal pay dispute

Reported by Sarah Mullane

Thousands of female council workers are set to receive pay-outs totalling an estimated £500 million, following a twelve-year dispute with Glasgow City Council.

In the case, which involved around 14,000 separate claims, the claimants argued that a job evaluation scheme implemented in 2006 entrenched discrimination within the council by paying significantly less to those in female-dominated jobs.

The scheme was initially introduced by the labour-run council as a means to address gender pay inequality, but remarkably led to one of the largest ever equal pay strike in UK history.

In October 2018, more than 8000 women employed in jobs ranging from homecare, to cleaning, to catering took part in a strike against both the inequality in pay over the years, and also the council’s handling of the case.

Campaigners have argued that the job evaluation scheme actively discriminated against female council workers by penalising those working split shifts and irregular hours, which were often jobs dominated by women.

It was found that these roles, such as cleaning and catering, were regularly paid less than their male-dominated counterparts (such as refuse collection) by up to £3 an hour.

After winning control of the council in 2017, the Scottish National Party promised to work to settle the claims, but were soon reprimanded for their inadequate engagement in negotiations and lack of desire to fulfil their commitment.

However, Susan Aitken, leader of Glasgow city council, has spoken in defence of the speed at which the council has reached this agreement, claiming that it had been done “in a relatively short space of time.”

She also claimed that her “commitment to resolving the issue has never waved” and that she was “delighted” that an offer had been agreed. GMB Union organiser, Rhea Wolfson, hailed the decision as a “hugely significant moment” as the council provided recognition of the value of women.

Following this fight through the tribunals and courts over the last decade, officials have confirmed that a deal has been agreed in principle to resolve the issue, and that claimants could expect to be paid in the next financial year.

Though similar cases have been recently settled, this particular case will prove to be of great significance due to the lengthy process time and sheer number of claimants involved.

Claimants and council members must now approve the deal before payments are made.

Find out more here.

Watchdog's gender pay gap twice the national average

Reported by Dan James

The Financial Conduct Authority revealed this week it pays male staff a fifth more than female staff.

The watchdog’s gender pay gap was 21.2% in 2018 – up from 20.9% in 2017 despite a pledge to improve it. The average gap across all UK companies last year was half that at 9.7%. Nicky Morgan MP, Chair of the Treasury Committee, said the FCA’s pay gap is going in the “wrong direction”.

The news comes at a time when campaigners and MPs are calling on the financial services industry to tackle its large gender pay disparities.

Andrew Bailey, the head of the City watchdog, has also repeatedly called for an overhaul within Britain’s finance industry, saying that a lack of diversity in the workplace can create “groupthink”.

The figures show much of the gap was due to an imbalance of women in senior leadership roles/ Some 61% of workers in the top quarter of pay at the FCA were men. This then fell to 56% who were men in the middle quarter and 43% in the lower quarter.

The agency said a greater proportion of women were paid bonuses than men in 2018, although the bonuses for women were in fact 25% lower.

A spokeswoman said for the watchdog said “the FCA’s gap is below that for most firms we regulate but this does not make us complacent and we are committed to reducing it.”

Find out more on the Guardian and the BBC.

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