Why you should think small when it comes to cost cutting
Plus, financial market turbulence continues, Asda loses market share and is your strategy telling you what not to do?
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Business Agenda
A summary of the most important business news
1. Asda has continued to lose market share to its rivals, with revenue in the second quarter of its financial year down 2.2 per cent and like-for-like sales (sales at stores open for at least a year) down 5.3 per cent. The supermarket’s CFO Michael Gleeson tells City AM says it needs to improve areas including availability, customer perception and trade plan. You can read more here.
2. The financial markets are continuing their week of turbulence, with Wall Street seeing its best day of trading in nearly two years following the slump at the start of the week. The S&P 500 rose 2.3 per cent, while the Dow Jones industrial average was up 1.8 per cent and Nasdaq Composite rose 2.9 per cent. But the pound is on track for its worst run in a year, with sterling heading for its fourth weekly loss in a row having dropped by two and a half cents against the dollar over the past month. You can read more here.
3. Hargreaves Lansdown has agreed to a £5.4bn takeover by a consortium of private equity firms that includes CVC Capital Partners, Nordic Capital and Platinum Ivory. The company was founded in 1981 and sells products such as pensions direct to customers. It is the latest firm to delist from the London market. You can read more here.
4. Businesses are looking for prime office space “earlier than ever”, according to the chief executive of Derwent, Paul Williams. He says some companies are looking five or six years ahead of their lease expiry, when it used to be two or three years. The company says it now expects to raise rents by between 3 per cent and 6 per cent this year; it had previously said increases would come in at between 2 per cent and 5 per cent. You can read more here.
5. Barclays has become the first UK bank to lift its cap on bonuses. Its senior bankers will now be able to earn payouts of up to 10 times their base salary, up from a two-to-one ratio that was imposed when the UK was a member of the EU. Other banks, including Goldman Sachs and JPMorgan, have already taken similar action. You can read more here.
Business Question
How many volunteers are helping at the Paris 2024 Olympic and Paralympic Games?
A. 45,000
B. 42,000
C. 39,500
D. 38,000
The answer can be found at the bottom of the page.
Business Thinker
Deep dives on business and leadership
✂️ Small can be beautiful when it comes to cutting costs
Business leaders often think cost-cutting has to be dramatic, that they need to make redundancies, shut offices or terminate some products. But companies like Morrisons, which has increased the temperature on its freezers from –18C to –15C to reduce its energy costs, are showing that small changes can make a big difference.
Strategy is important in a business; it helps everyone understand where the company is headed and how to get there. However, as Ian Shepherd writes in his always excellent Moving Tribes newsletter this week, companies focus too much on what is important and not enough on what they shouldn’t be doing. The key question to ask, he says, is: what does this strategy tell us we should NOT do? Can you business answer that question?
🎽 Rose Harvey: from City lawyer to Olympian in four years
A bit of inspiration to take into the weekend this Friday morning. The Times has an interview with Rose Harvey, who took up running more seriously after losing her job at the start of the pandemic and found she was very good at it!
Business Quote
Inspiration from leaders
“None of us can know what we are capable of until we are tested.”
– Elizabeth Blackwell
Business Leader
The best of our content
Growth Stories: Shows that must go on
Jennifer Davidson has propelled Sleek Events from a humble start in 2014 to a projected turnover of £22m this year. With a focus on delivering exceptional service, Sleek’s growth has been driven by word-of-mouth and a dedicated team of 100, including 40 full-timers.
Despite setbacks during the Covid-19 pandemic, the company has rebounded by actively pitching for new clients like PayPal and Pernod Ricard. Davidson, who prides herself on maintaining a personal stake in the company, aims to eventually transition Sleek to employee ownership.
We talk to them in the latest instalment of Growth Stories. Read the article here.
Other popular pieces
✍️ Process has its place but what adds real value is setting creativity free
♀️ Backing women-led businesses is the best idea you can have
🖥️ Inside the rise of Larry Ellison’s tech empire
And finally…
We’re well into the English summer and it looks like we might actually see some sun this weekend, with temperatures in London at least set to hit the high 20s on Sunday and into Monday.
That probably means a lot of us will be flocking to the beach – and we might even be on a beach with a cherished fixture of the British seaside: the beach hut. The Guardian has published a piece looking at these huts and the different roles they play for those who use them. Some are only big enough to sit in or get changed in, while others have kitchenettes and beds.
You can see all the images here.
Have a great weekend!
The answer to today’s Business Question is A. 45,000
