Budget day bluesPosted: March 23, 2011
Civil war in Libya and the ongoing disaster in Japan, plus George Osborne’s “heads down” style, have been enough to minimise media attention in the run-up to today’s Budget. But enough of that, let’s talk about the royal wedding…
This is a pre-Budget blog, and you’ll looking to plenty of other news sources for your post-match analysis after the chancellor sits down. The BBC is suggesting (presumably on good authority) that some sort of tax cut is in the offing – in addition to the suspension of the fuel duty escalator – but these measures will be window dressing in an economy with rising inflation, imminent rising interest rates, and rising unemployment. In the absence of consumer stimulus, we have to hope that this is a budget for growth, encouraging investment and expansion in the private sector.
For retailers, the short to medium term prognosis is challenging. Tim Danaher fielded some of the biggest beasts in the sector at last week’s Retail Week conference, but although there was much common sense spoken (retailing always comes back to common sense), there were few expressions of short-term confidence.
Since then, JJB’s creditors have pondered the gun at their temple, and approved its CVA (again), providing another stay of execution for the troubled brand. And, in this blog’s corner of the universe, we await the next announcement from HMV.
I popped up to Islington yesterday to have a look at HMV’s new prototype tech offer. Around 35% of the net space in the store has been given over to this offer, which as you can see is more professionally presented than in its previous iteration, and boasts a full Apple range, plus higher end brands like Bose. The bulk of the offer appears to be made up of headphones and docking stations – in other words, iPod/iTouch accessories. Will a regular HMV store be able to shift sufficient units from these ranges to make up for the loss of CD and DVD sales, and will the margins in electricals (which aren’t great) make that investment worthwhile?
This is very much work in progress – HMV announced the appointment of Ewan Pinder from Comet as Head of Technology yesterday. This blog will endeavour to keep an eye on future prototypes, but if you are in N1, this is worth taking a look at.