Archive | February, 2013

ROGUE TRADERS FORCED TO CUT THE SCRAP

ROGUE TRADERS FORCED TO CUT THE SCRAP

New laws on trading in scrap metal were passed today and will come into force later this year in a bid to cut back on sharp increases in criminal trading.

The Scrap Metal Dealers Act will build on measures which have already been taken to clamp down on illegal trading, such as the ban on cash transactions at scrap yards introduced last December.

The Act will introduce licensing for all traders and allow councils or the police to revoke licences and recover the cost of investigation and action against rogue traders.

It will insist that all metal sellers show identification, and that records of transactions with them are kept for at least two years. A national register of licensed traders will also be created, while the ban on cash transactions is extended to mobile traders going door-to-door.

Magistrates will also be given the power to impose unlimited fines on those flouting the ban on cash transactions, operating without a licence or breaching licence conditions.

The Home Office says there are around 1000 metal thefts a week, with the illegal trade in scrap costing the UK economy an estimated £220 million a year.

Exhausts often fall victim for their high content of precious metals, but First Line also told CAT it had to be on their guard when building their new Banbury warehouse. Criminals have no hesitation in lifting railway tracks, cutting power to hospitals or targeting war memorials, either.

Richard Ottaway MP, who tabled the original bill for the Act, said: “It is particularly fitting, therefore, that this law has come in on the eve of the centenary of the First World War.”


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Ben receives £2500 donation from Enterprise

Ben receives £2500 donation from Enterprise

Screen shot 2013-02-28 at 10.43.30Automotive industry charity BEN says it was pleased to receive £2500 in donations from the Enterprise Rent a Car team.

The donation was awarded from the company this month, and will be used to purchase specialised equipment for BEN’s care centre in Berkshire. Commercial Development Manager for the charity Nigel Williams said: “We are pleased to be recognised in this way by Enterprise who is an excellent supporter of our charity, engaging in numerous fundraising activities and volunteering on a regular basis.”

BEN Communications Officer Amanda Clements said: “The efforts of companies like Enterprise help underline why industry-wide support is vital for BEN to offer its full range of services to all of our colleagues and dependants in times of need”

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UK ECONOMY GROWS MORE THAN EXPECTED IN 2012

UK ECONOMY GROWS MORE THAN EXPECTED IN 2012

The UK economy has grown more than expected in 2012.

Growth in several sectors including construction caused the Office for National Statistics to revise its forecasts – changing the expected figure of no growth to 0.3 percent.

Revisions to the performances of some sectors in the last quarter of 2012 is believed to be part of the reason for the improved statistic, while the Olympics provided a welcome boost in Q3.

However some sectors performed worse than expected. The production industry was revised down from a 1.8 percent contraction to 1.9 percent.

Credit ratings agency Moodys took away the UK’s AAA credit rating last week, saying that any growth in the UK economy would “remain sluggish” for the coming years. One idea to continue to help the economy, floated by Bank of England Deputy Governor Paul Tucker, is to introduce negative interest rates. That would change the rates the central bank charges other banks to hold money, which could encourage banks currently unwilling to lend money to do so. A recent billion pound boost to the SME economy will help, too.

Speaking at the CAT Awards 2013, Business Secretary Vince Cable spoke of the importance of the UK manufacturing sector, promising that more would be done to improve access to funds for small businesses.

UK companies dealing with Europe will need to be vigilant, especially as major events in the European Union – such as the indecisive parliamentary election in Italy – continue to unfold.

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POUND SLUMPS AS UK LOSES AAA CREDIT RATING

POUND SLUMPS AS UK LOSES AAA CREDIT RATING

The value of the UK pound has fallen following news that credit ratings agency Moody’s has downgraded the UK’s coveted AAA credit rating.

The news, announced on Friday, has caused the pound to fall to a two-and-a-half year low against the dollar. The pound has also fallen against the Euro, to its lowest value in 16 months.

Despite UK forecasters saying that the UK is beginning to recover economically, Moody’s included a warning with its grading saying that any growth would “remain sluggish” for the foreseeable future. However Business Secretary Vince Cable dismissed the move as being “largely symbolic – he also said credit ratings agencies like Moody’s were “tipsters.”

The UK’s had kept its AAA rating, the highest that can be awarded, since 1978. The move now leaves Germany and Canada as the only major economies to have the AAA rating, while the UK joins other countries like France and the US in having its title downgraded in recent months.

The ratings indicate the risk to investors of a country defaulting on its borrowing. AAA indicates that there is a minimal risk to investors.

How will the loss of the UK’s AAA rating, and the fall in value of the pound affect your business? Let us know in the comments section below.

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CAT retail lives: Streetwize

The business is no stranger to CAT

The business is no stranger to CAT

Murray Silverman has a long history with the retail landscape and CAT – he’s featured on the cover of the magazine before with his business partner Les Millman as Ace Marketing.

The success of their Bury-based business, now called Streetwize, pours cold water on the scurrilous theory that appearing on the cover of our magazine is some kind of kiss of death.

The retail landscape has changed, yes, but Silverman and Millman have adapted with the times. Murray’s son Dale has joined the business along with Dave Davies, the four of them now pushing ahead with the ‘wize’ branding which can be adapted to different sectors as needed.

One of these new avenues is Leisurewize which Murray thinks has a bright future. He’s taken on John Townsend to head that drive: “He’s got a wealth of history. We’re not going into the leisure business with people who don’t know anything about it.”

The business has been sourcing from China for 12 years now, but over recent years the biggest increases in turnover have come from online activity, says Davis. He reckons online customers stand to benefit the most from leisure products as ‘it doesn’t cost a thing to put a picture online.’

One thing that Silverman wants to underline very clearly is that the company won’t sell direct to the public. Product can creep onto the likes of eBay or Amazon – Autoglym also has this problem – but Silverman says he does his best to police it.

The array of products on display in the company’s showroom is certainly impressive. There are 2000 different products available, a 60,000 sq ft warehouse and a big delivery for TK Maxx going on the day of our visit.

Over the summer Streetwize is going to look at retailers that do well with the leisure lines and we aim to report back on how it’s helped their business.

The Streetwize product cave

The Streetwize product cave

A lot of the time, however, Silverman says he can come up against a brick wall with customers who don’t want to try something new. This is particularly true of bigger chains: “You’ve got a product you know sells week on week, month on month. You’ve got all of the stats in the world and they won’t take it.

“All of us here have been in this business years and years longer than the graduate who’s just started. We can try and convince them, but it’s very frustrating.”

Silverman also thinks garages are missing a trick by not stocking a few items: “The impulse buy is there. Any garage that’s got space could do it, get a few products in. People are there, waiting, bored, for twenty minutes.” It’s certainly a tactic that works for Wilco…

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How do independents stack up online?

An article on dealer-focused website Motor Trader caught my eye this weekend.

The article laid out the results of an online investigation in which the Motor Trader team approached 40 dealers through social networking site, Twitter, looking to buy a car. Those dealers all had active Twitter accounts.

So how many of those 40 do  you think responded with offers of test drives and bookings? Just 12.

Of those, only half responded within an hour and just three engaged the pretend customer in conversation.

Now fair enough, this research is based around buying a car rather than running it, but the lesson learnt can be applied to almost any trade. If you take the trouble to get yourself online, then make use of it. We know there are thousands of members of the independent automotive aftermarket, from suppliers to factors and garages to retailers using the social networking platform to get their message across, and for some it works wonders.

Increasingly consumers are turning to the digital realm to find the right workshop to take their car, so being online and being active is more important than ever.

Do you regularly get customer referrals online? What’s your top tip for the aftermarket when it comes to social networking? Let us know in the comments below.

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AUDITORS FAILING COMPANY SHAREHOLDERS

AUDITORS FAILING COMPANY SHAREHOLDERS

A lack of competition in the audit market is failing shareholders as it encourages the big four accountancy firms to favour management interests, the Competition Commission (CC) said today.

Publishing its provisional findings into the supply of statutory audit services to FTSE 350 companies, the CC said a lack of competition outside the big four ‘is likely to lead to higher prices, lower quality, less innovation for companies and a failure to meet the demands of shareholders and investors’.

It said FTSE companies find it too difficult to compare services, prefer continuity to the significant costs of switching and lack bargaining power as a result. It said audit firms outside the big four of Ernst and Young, Deloitte, KPMG and PriceWaterhouseCooper find it hard to convince FTSE 350 companies that they have sufficient experience to deal with their accounts.

While auditors are appointed to protect the interests of shareholders, the CC said services are too often focussed on meeting the needs of senior management who decide where to spend their audit budget. This means that competition focuses on factors that are not aligned with shareholder demand.

It found that 31 percent of FTSE 100 companies and 20 percent of FTSE 250 companies have had the same auditor for more than 20 years, while 67 percent of FTSE 100 companies and 52 percent of FTSE 250 companies for more than ten years.

The CC is now looking at ways to encourage greater competition through mandatory tendering and rotation, increasing information and transparency with reviews and extended reporting requirements and strengthening accountability and independence by giving audit committees and shareholders greater control.

Laura Carstensen, Chairman of the Audit Investigation Group, said: “We have found that there can be benefits to companies and their shareholders from switching auditors but too often senior management at large companies are inclined to stick with what they know, particularly when it is difficult to compare with the alternatives and the incumbent auditors are in a strong position to hold on to the business.

“Whilst we accept that most audits are performed diligently and understand that those involved are behaving rationally in response to their incentives, auditors tend to focus on management interests over those of shareholders. For example, management may have incentives to present their accounts in the most favourable light whereas shareholder interests can be quite different.

“It is clear that there is significant dissatisfaction amongst some institutional investors with the relevance and extent of reporting in audited financial reports. This needs to change so that external audit becomes a more genuinely independent and challenging exercise where auditors are less like corporate advisors and more like examining inspectors.”

KPMG said it noted the emphasis the CC placed on the need for independent and objective audits in serving the shareholder and investor and welcomed the finding that most audits are performed diligently and that there is no evidence of collusion. It rejected, however, ‘the assertion that auditors’ focus is too often on management and that shareholders are not being properly served’.

Simon Collins, Chairman and Senior Partner of KPMG in the UK, said: “We believe that audit quality and competition in the UK is strong.  We fully recognise our duty to shareholders and the absolute importance of our independence.  Audit objectivity and appropriate levels of scepticism are the mainstays of what we do.

“We do not agree with the Commission’s conclusion that, effectively, audit committees are not doing their jobs properly.  In our experience, audit committees in the UK generally take their responsibilities seriously, both for oversight of the external auditor and financial reporting more generally. Indeed if audit committees were not functioning properly, it would have much more fundamental ramifications for UK corporate governance.

“We want to see the relevance of audit enhanced and we have been working with stakeholders to achieve this and to improve audit quality.

“However, we do not support their suggestions as regards mandatory tendering or rotation. After long deliberation and consultation, the Financial Reporting Council has only just introduced tendering every ten years on a “comply or explain” basis and this is already having a significant impact.

“We supported this measure as we believe it fits with the corporate governance framework in the UK and reinforces audit committee oversight of the external auditor.  Arbitrary pre-set periods will do the reverse and potentially damage audit quality, and forced rotation will undermine audit committees and actually reduce shareholder choice. It is premature, therefore, to disregard the FRC measures as an effective remedy.”

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UKPLC helps make Automechanika India a success

UKPLC helps make Automechanika India a success

Nine UK companies helped to make the inaugural Automechanika New Delhi event in India a resounding success.

Making the trip to India’s capital for the show were representatives from Allmakes 4×4, Automotive Distributors Ltd, Mini Gears, Motive Components Ltd, Primalec, Ranger Stork/Magnocrest, Scorpion Automotive Ltd and Turbo Technics Ltd. The SMMT was also present.

The UK contingent helped to bolster the 112 international exhibitors at the show, joined by 149 from India itself. The New Delhi event was a first for Automechanika orgnaniser’s Messe Frankfurt, but an important one nonetheless. New Delhi contributes 22 percent of India’s manufacturing GDP.

Honourable Minister for Heavy Industry and Public Enterprises Shri Praful Patel said: “ACMA Automechanika New Delhi is a very important show to India’s automotive industry. India today produces high-quality components and has a strong manufacturing base. In addition, the country’s growing economy is a key indicator of the rapid development in the automotive industry, and is poised for extraordinary growth. A show like this gives India’s auto industry the perfect chance to showcase its current progress.”

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Motor trade faces “perfect storm” for failure, says IMI

Motor trade faces “perfect storm” for failure, says IMI

The IMI says automotive businesses must invest in new skills or risk failure.

In the run up to the public launch of its Professional Register in April, the IMI says the motor trade faces a “perfect storm” for failure in the next three years. A lack of management skills, little customer service skills and a rise in vehicle technology are all contributing.

Backed by Government, the IMI’s Professional Reguster aims to have 50,000 registered technicians by 2013. All ATA accredited technicians will automatically be added to the register when it goes live.

New IMI CEO Steve Nash said: “There’s no question that our industry needs to up-skill.  Managers, especially those in small businesses, typically do not possess the formal training in areas such as sales, customer service and financial planning, to survive and prosper.  In an industry that suffers from poor public perception, having well skilled staff can make the difference between the life and death of a business.

“Businesses need to recognise the importance of training their people and invest in it.  Too often training is simply seen as a cost and is the first thing to be cut when times are hard.  The fact is that well trained people will sustain a business and bring the good times earlier.  This is even more important for small businesses where having a wider skill set is vital in running the enterprise.”

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Billion pound boost to SME economy

Billion pound boost to SME economy

More than 10,000 small and medium-sized enterprises (SMEs) have been able to access commercial loans and boost the economy thanks to a Government-backed scheme, a new study has shown.

The Enterprise Finance Guarantee Scheme (EFG) has added £1.1 billion to the economy since May 2010, with every £1 invested delivery £33.50 has been delivered, the report by Durham Business School has found.

It says freeing up funding has created 6,500 jobs and safeguarded more than 12,000. Business Minister Michael Fallon is now calling on banks to increase their lending after the proven success of EFG. He said: “Clearly the demand is there for this type of financial support so we must start to see an increase in take-up.”

With the Government acting as guarantor on 75% of small business loans – ranging from £1,000 to £1m – a large number of SMEs that would otherwise have inadequate security have been able to secure £1.04 billion to fund their businesses.

Other Government incentives to increase SME growth includes Seed Enterprise Investment (SEIS), which combines 50% income tax relief on share cost and capital gains tax exemption from their disposal; and start-up loans, a £112m scheme to help 18-30 year-olds start their own business.

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