In the papers this week 12 – 18 Dec 2009
Tesco takes Dunnes to the High Court over "misleading" price comparison ads, Barry Group bags Carry Out, Superquinn to open new Rathgar store next year
18 December 2009
Tesco has brought Dunnes Stores to the High Court to prevent the retailer running what it claims are misleading price comparison advertisements in the run-up to Christmas. Tesco says it is concerned because the Dunnes adverts make direct and largely unexplained comparisons between everyday and short-term promotional prices. However, Dunnes responded Tesco’s application is misconceived in law, unsustainable and that the multiple has created an artificial urgency about the matter.
The Barry Group has acquired the Carry Out off-licence business for an undisclosed sum, reports The Irish Times. The Carry Out chain, which has 52 stores nationwide and an estimated 35% share of the specialist off-licence market, was previously owned by another Cork-based group, Galvin’s Wholesale, which went into receivership earlier this month. The Barry Group, which operates the Costcutter and Quik Pick franchise, said it expects the takeover to add €42 million its annualised turnover of €212.5 million.
Barry Group managing director Jim Barry told The Irish Examiner that the takeover represented "a substantial investment and a significant milestone for the Barry Group as we look to build our footprint in the mainstream off-sales sector. He added it would allow the group "leverage our increased buying power across all our selling channels." The paper also reported Corkonian distributors Barry & Fitzwilliam had been close to signing a deal for Carry Out but owner Michael Barry said he decided "not to pursue" this interest.
The Barry Group also received coverage in The Sunday Tribune this week when MD Jim Barry claimed several small to medium wholesalers would be forced to close – following the government’s "poorly thought out" implementation of its alcohol excise cut. He claimed that because the Revenue Commissioners are not allowing a claim back on the duty paid for existing stock, that this has devalued existing off-licence stock by 10-12% at the time of the year when stock levels are highest. The cost to his own business stands at €200,000, while another wholesaler allegedly faces losses of more than €500,000.
The price of a Christmas dinner has tumbled by 30% this year, thanks to deflation and cut-throat competition between retailers, according to The Sunday Independent. The paper calculates a basic Christmas dinner could set a family of 10 back €117 this year compared with €160 in Christmas 2008. Savings include fresh turkey falling by up to 5% across butchers’ counters and frozen vegetables falling 10%. Customers are now also increasingly plumping for a 5kg bird over the 7kg turkey popular in recent years.
A loss to the exchequer of €90m through southern shoppers heading north, is insignificant compared to the huge decline experienced in VAT and excise duties over the last two years as consumers stopped spending, writes Eamon Quinn in The Sunday Tribune. In 2007, the government gathered €14.5bn in VAT receipts and €5.8bn in all excise duties. However a year later these had fallen to €13.4bn and €5.4bn respectively. The government’s own budget documents also suggest cutting excise duty will cost the exchequer €90m, coincidentally exactly the amount it calculates it lost last year in taxes to the North.
The government has used Northern shopping "as a smokescreen to distract from its inactivity in tackling costs in the Republic, and had hidden the failure of retailers to pass on the benefits of the strong euro to southern shoppers." That was the verdict of Sainsbury’s Newry landlord Gerard O’Hare’s in The Sunday Tribune this week, who also claimed the excise cuts would have little impact on the numbers heading north. This view is shared by Bill Tosh, chief executive of the Dundalk Chamber of Commerce, who believes people here are being treated like "suckers" by the ‘dual pricing’ policy of British distributors and retailers.
Supermarket chain Superquinn will open its new shop in Rathgar next year, reveals The Sunday Tribune. The retailer has said the store which has allegedly been completed to shell standard for months and has a boarded up front "is an important part of the long-term development plan for the business".
Media mogul Rupert Murdoch is taking a personal interest in newsagents’ sales, reports The Guardian. The News International boss visited several shops in the west London area last week, in order to, according to a spokeswoman, "know what was happening on the ground." One newsagent was particularly surprised to learn from a customer the identity of the polite, elderly gentleman who asked questions such as "How many copies of this or that paper do you sell? Are you getting your copies on time? And what’s your major problem at the moment?"
The High Court has dismissed a challenge to the constitutionality of the Charities Act, brought by Longford Mass Card company (MCC) owner Thomas McNally. The supplier had argued the act unlawfully conferred a monopoly on the sale of Mass cards to clerics of the Catholic Church or to persons approved by them. However Mr Justice McMenamin held that there was ample material to show that certain of MCC’s and other businesses activities could mislead ordinary Catholics or purchasers as to the authenticity of their mass cards and their compliance with canon law.
Agri Aware has urged consumers to consider the 270,000 jobs supported by the agri-food industry when shopping this Christmas. The Irish Examiner reports the organisation’s chairman Máiréad Lavery has pointed out "Ireland consumes €11 billion worth of food annually which is predominantly supplied by our indigenous agri-food industry," and that, "the livelihood of one-in-every seven people in communities nationwide relies on the agri-food industry.
The European Commission has invited all Europeans to cast their votes in the final stage of the EU’s organic logo competition. The Irish Examiner reports an online vote was implemented in order to ensure the new logo appeals to as many people as possible. Unlike the current logo, the winning entry, which can be voted for on http://ec.europa.eu/agriculture/organic/logo/index.htm, will be obligatory for all pre-packaged organic products that derive from the 27 EU member states and meet the labelling standards.
Cheques will disappear within eight years in the UK, after the Payments Council decided this week to abolish the 350-year-old payment method by October 2018. The Times (UK) reports the decision could also prove disastrous for millions of small businesses, community groups and charities who only accept payment by cash or cheque. However the move will save banks hundreds of millions of pounds a year, as each cheque costs banks about £1 to process – four times more expensive than electronic payments.