UK retail sales fall in September, digital euro edges closer, X charges users, and more

UK retail sales volumes hit by decline in online orders
UK retail sales volumes hit by decline in online orders

RETAIL

Retail sales volumes in the UK dropped by 0.9% in September 2023, compared to the same month last year, latest figures from the Office for National Statistics (ONS) have revealed. This fall comes after a 0.4% rise in August and was worse than analysts expected, raising concerns ahead of the crucial Golden Quarter period. The decline was mainly driven by online retailers, which were hardest hit with a 2.2% fall in sales volumes. As well as non-food stores, with sales volumes dipping 1.9% last month, hit by “unseasonably warm weather” in clothing and continuing cost-of-living pressures.

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New Look’s losses have widened, despite revenues edging up, according to its latest results. In the year to March 2023, total sales grew to £844.7 m, up from £839.6 million the previous year, mainly driven by the UK and Republic of Ireland. With adjusted EBITDA rising to £42.2 million, up from £25.2 million. But the statutory loss before tax was £87.8 million, wider than the £25.5 million loss of a year earlier, which it attributed to a one-off impairment charge of £47.4m following “annual accounting assessment of all tangible and intangible assets”.

Earlier this month, New Look successfully completed a £100m debt refinancing deal with Wells Fargo and Blazehill Capital, in a bid to support future growth.

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MARKETS

With a reported valuation of $66bn, Shein is understood to have tapped ex Bear Stearns investment banker Donald Tang to be its executive chair and public face, ahead of a possible IPO in the US. The Chinese ultra-fast-fashion giant is reportedly taking steps to address issues around forced labour in its supply chain, violation of labour laws and harm to the environment. And retail experts predict that if it can overcome these hurdles whilst maintaining a strategy that propelled it to success, it could be a “winner on Wall Street.”

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CURRENCY

The European Central Bank (ECB) is edging closer towards launching a digital version of the euro, after announcing the start of a two-year “testing and experimentation” phase on November 1. The digital euro would allow all 20 countries within the EU that share the single currency to make electronic payments securely and free of charge and could become a global footprint. China is also trialling a central bank digital currency (CBDC), a prototype yuan with 200m users.

Digital Euro trials launch on November 1
Digital Euro trials launch on November 1

And 130 countries (representing 98% of the global economy) are now exploring digital versions of their currencies, with almost half in advanced development, pilot or launch stages, a closely-followed study shows. 

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EMPLOYMENT

Big banks are quietly laying off thousands of employees, reports CNBC. With the exception of JP Morgan Chase, the next five largest US banks have slashed a combined 20,000 positions so far this year, according to company filings, “pressured by the impact of higher interest rates on the mortgage business, Wall Street deal-making and funding costs,” it has been revealed. The move comes after a two-year hiring spree in Wall Street during the pandemic, fueled by a surge in activity. 

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DEALS

Online luxury retailer Farfetch’s purchase of a stake in rival Yoox Net-a-porter (YNAP) from Richemont has been approved by European authorities. Completion of the deal still remains subject to certain conditions that both businesses are “working towards fulfilling,” Richemont said, with Farfetch’s struggle to make a profit understood to have raised questions for the luxury group. Under the terms of the deal unveiled in August 2022, Richemont would sell a stake of 47.5% in loss-making YNAP in exchange for more than 50 million Farfetch shares, and Farfetch could acquire the rest of YNAP through a put and call option arrangement.

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SME’s

Small and medium sized companies are losing out on £7.5bn each year, as banks fail to pass on higher interest rates to businesses with savings, a new study of the business savings market has found. The report said banks are “systematically” offering bigger firms’ better savings rates whilst small businesses have £150bn of deposits sitting in accounts offering no interest at all.  

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SOCIAL MEDIA

X has begun charging new users $1 a year in New Zealand and the Philippines, as part of a new global trial. The social media app, formerly known as Twitter, says it is aiming to “reduce spam, manipulation and bot activity.” The subscription includes the ability to tweet, retweet, like posts and reply to posts. Those who opt out of the subscription fee will only be able to read posts, watch videos and follow accounts. New accounts will also be required to verify their phone number. 

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TECH

“AI will never threaten humans”, says Tann LeCun, Meta’s chief AI scientist. He says premature regulation of artificial intelligence will only serve to reinforce the dominance of the big tech companies and stifle competition, in an interview for the FT’s upcoming Tech Tonic podcast series. LeCun compares regulating leading-edge AI models to like regulating the jet airline industry in 1925, when such aeroplanes had not even been invented. Meta has been championing more accessible, open-source AI systems, while OpenAI’s model GPT-4 is a so-called “black box” in which the data and code used to build the model are not available to third parties.

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AUTHOR 

Picture of Emily Seares

Emily Seares

Emily Seares has over 15 years of experience as a journalist and editor, specialising in fashion, retail, luxury, and business transformation. She is regularly by-lined in national newspapers and magazines and has an extensive network of industry contacts. Emily has spoken at international conferences, provided live interviews as a fashion expert on the BBC, and delivered regular lectures at a prestigious British university. She has received recognition for her contributions to the industry and was honoured in British VOGUE's Powerlist Top 100.

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