Supermarkets 'creating jobs' WTF?

[AJS-]

singlecoil said:

Ozzie Osmond said:

singlecoil said:

Feel free to add something...

In your opening post you say that for a supermarket to "create jobs" is not possible, because in your analysis more jobs are lost elsewhere.

What is your view of carpenters who use power tools, thus working more efficiently and putting traditional carpenters with hand tools out of business?

I was suggesting that you add something other than sarcastic remarks or irrelevant questions. Surely you have an opinion on the topic?

It seems like a sound example to me. You seem to be bemoaning jobs being lost to efficiency gains. How far back would you take it?

[F i F]

eccles said:

Whilst I agree with you about the lack of choice on the high street regarding record shops, I'd say the supermarkets aren't to blame. Internet shopping and technology like MP3's were in their infancy 10 years ago and are the likely candidates for killing off the record shops.
If anything, supermarkets have shown what a rip off the traditional music shops were, they'd still be charging £10 or £12 for a CD, where your average supermarket sells the same product for £7 or £8 (much the same goes for bookshops).

Would tend to agree with this, and the real culprits are Amazon and the people who know the cost of everything but the value of nothing. The supermarkets were merely opportunistic traders who decided to focus on the top selling products and use economy of scale, their predatory purchasing skills, and the economies of their supply network.

Not sure I agree about the rip off issue totally in all respects. The bookshop is a prime example of somewhere that allows the customer to examine the product and decide whether it suits them and, particularly in the case of non-fiction, if it addresses the issues they are interested in. That is not possible on Amazon, the peek inside function being largely ineffective.

It also allows the customer to see similar books on the same subject that they might not have considered or even known about, though whilst annoying, the Amazon "have you thought about this" can be useful. The bookshop can however take you off in completely unexpected tangents, can be good, can be time wasting, but also very rewarding.

All that has a value to the customer that the internet cannot match and cannot be provided at the same rate as internet sales, especially considering High St rents and council rates.

I would argue that bemoaning the oligopoly that supermarkets represent is simply now just too late, and the phrase "use it or lose it" that was applicable a long time ago is largely defunct. The guilty parties in all this is a much longer list than the supermarkets.

[AJS-]

F i F said:

Would tend to agree with this, and the real culprits are Amazon and the people who know the cost of everything but the value of nothing. The supermarkets were merely opportunistic traders who decided to focus on the top selling products and use economy of scale, their predatory purchasing skills, and the economies of their supply network.

Not sure I agree about the rip off issue totally in all respects. The bookshop is a prime example of somewhere that allows the customer to examine the product and decide whether it suits them and, particularly in the case of non-fiction, if it addresses the issues they are interested in. That is not possible on Amazon, the peek inside function being largely ineffective.

It also allows the customer to see similar books on the same subject that they might not have considered or even known about, though whilst annoying, the Amazon "have you thought about this" can be useful. The bookshop can however take you off in completely unexpected tangents, can be good, can be time wasting, but also very rewarding.

All that has a value to the customer that the internet cannot match and cannot be provided at the same rate as internet sales, especially considering High St rents and council rates.

I would argue that bemoaning the oligopoly that supermarkets represent is simply now just too late, and the phrase "use it or lose it" that was applicable a long time ago is largely defunct. The guilty parties in all this is a much longer list than the supermarkets.

Both examples are based on the small percentage of record and book buyers who are really into the product though. Vast numbers of people just want to walk in, buy a copy of the current best seller or the latest album by someone well known, and a supermarket is fine.

I would imagine most reasonable sized cities could still support a few specialist record or book shops. Pet Sounds in Newcastle always had some fairly specialist stuff, but there would be little point in going there to buy the latest N Sync album, and it's quite normal that general retailers can sell these cheaper. Same as happens with food, clothes and nearly everything else.

[singlecoil]

AJS- said:

singlecoil said:

Ozzie Osmond said:

singlecoil said:

Feel free to add something...

In your opening post you say that for a supermarket to "create jobs" is not possible, because in your analysis more jobs are lost elsewhere.

What is your view of carpenters who use power tools, thus working more efficiently and putting traditional carpenters with hand tools out of business?

I was suggesting that you add something other than sarcastic remarks or irrelevant questions. Surely you have an opinion on the topic?

It seems like a sound example to me. You seem to be bemoaning jobs being lost to efficiency gains. How far back would you take it?

A good example of the problem with skim reading a thread-


You must have missed this post altogether

singlecoil said:

There's really only one point to my argument on this thread, and that is that Asda (or whichever supermarket it is that happens to announce an expansion) is not creating jobs, it's actually reducing the overall number of jobs in the area concerned.

Now I'm not saying that that's a bad thing, just that the press releases are bks.

[singlecoil]

F i F said:

considering High St rents and council rates.

I felt I should draw attention to the fact that business rates, although collected by the local council, actually go to central government. They are a fixed (by central government) proportion of the market rent, so it's the rents that are the problem.

[AJS-]

singlecoil said:

A good example of the problem with skim reading a thread-


You must have missed this post altogether

singlecoil said:

There's really only one point to my argument on this thread, and that is that Asda (or whichever supermarket it is that happens to announce an expansion) is not creating jobs, it's actually reducing the overall number of jobs in the area concerned.

Now I'm not saying that that's a bad thing, just that the press releases are bks.

I had read it, it just doesn't change anything.

They have actually created jobs, the knock on effects of these jobs may destroy other jobs, but that applies to any job creation, or any other efficiency gain. If they had said that they had added 5,000 jobs net to the economy you might have a point about an optimistic press release, but creating 5,000 new jobs is exactly what they have done.

[singlecoil]

AJS- said:

I had read it, it just doesn't change anything.

Did you read it before you posted this?

AJS- said:

You seem to be bemoaning jobs being lost to efficiency gains.

Because if you did, your post doesn't make any sense, as nothing I have said could be construed in that way.

[DonkeyApple]

Digga said:

What I have noticed as a recent trend is that firms - JCB and Toyota, to name but two local to me - announce job creation with great media fanfare, but very often when you drill into the the detail you find they are not employing the workers, rather they are hiring agency (usually Blue Arrow in the case of the examples given) workers who are therefore not on permanent contracts or, strictly, employees of the firms in question.

Tesco misses targets, whole industry under spotlight. Quick, announce a load of new jobs and keep quiet about the fudge.

I wrote a lengthy bit on a Tescos thread explaining how analysts and therefore investors monitor 'growth' at supermarkets and it is not remotely how people will think it is measured.

It is a direct result of this that causes supermarkets to do the following:

Announce new employment (while throttling employment elsewhere)

2 for 1 items as each item is booked as a sale and the industry is valued on like for like sales not profits.

Mini stores are mostly run at a loss but are designed to Hoover up scraps of unit sales which are booked to the accounts of the local super store for the purposes of increasing like for like sales.

Petrol will be booked as a unit being a litre, if an individual store looks like it may be missing like for like growth over the quarter then they will drop petrol prices to bring in sales an increase 2 for 1 offers.

Also, beer is a great one as when there is a football tournament on you've all seen tales of how supermarkets expect bumper profits? Well, mostly they don't. What they get is bumper sales by stacking beer in heavily discounted cases of 24 and then booking each case as 24 items. Bingo. Huge growth in unit sales.

To cut a long story short. Believe absolutely nothing issued by a supermarket to the market. There is a code which the announcement is in and all data is massively manipulated to meet expected targets.

[DonkeyApple]

singlecoil said:

I felt I should draw attention to the fact that business rates, although collected by the local council, actually go to central government. They are a fixed (by central government) proportion of the market rent, so it's the rents that are the problem.

High street rents are a huge problem.

Global and pension funds have snapped up the buildings and want stable and good yields so only want to sub let to big companies.

There is also the issue that most funds actually overpay for these invesentments as they end up out bidding each other that to get the yield they need they need to push rents ever higher.

A lot of the high streets problem are due to the very badly run UK pensions industry.

But, something that is interesting is that during the late 90s and well into the noughties, one of the biggest group of debt fuelled over bidders for high street property were the Irish.

An enormous amount of this stock is now on the books of the Irish bad bank and is being jobbed out at cost or for whatever they can get. It's a complete mess.

But, our Govt could in theory buy at quite a discount whole blocks of the UKs high streets and have them managed at sensible rents to encourage local independent business.

[whoami]

singlecoil said:

In the news again, this time it's Asda creating 5,000 jobs.

http://www.bbc.co.uk/news/business-16676688

But I thought that the whole point of owning supermarkets was to keep the cost of purveying a set amount of food etc right down, in part by employing less staff than would be necessary to retail that much product through other outlets. Now, if that's true, then how does opening supermarkets create jobs? Is the fact that there is now a supermarket in an area mean that the customers in that area are going to consume more (and if so, where is that money going to come from)? Or that fresh money is going to come in from outside the area to pay for more product?

My guess is that those 5,000 jobs are going to be created at the expense other jobs in the areas concerned, when the existing retail outlets close as a result of the new competiton. I'm not in any way saying such competition is a bad thing, I'm just calling bullst on the job creation claim.

McDonald's have just announced that they are creating 2500 jobs.

Try not to think about it.

[AJS-]

singlecoil said:

AJS- said:

I had read it, it just doesn't change anything.

Did you read it before you posted this?

AJS- said:

You seem to be bemoaning jobs being lost to efficiency gains.

Because if you did, your post doesn't make any sense, as nothing I have said could be construed in that way.

Your original post said you were calling bullst on the job creation claim. ASDA issued a press release saying they are creating 5,000 jobs, meaning they are hiring 5,000 people who they didn't employ before. Not adding 5,000 jobs to the economy as a whole. That isn't ASDA's business.

This

singlecoil said:

Well, if those redundancies were caused by them closing supermarkets, I imagine there would be much rejoicing in those areas amongst the businesses that were best placed to supply the demand created, and if those businesses were less efficient, then quite possibly more than 5,000 jobs would be created.

Does appear to me to be bemoaning jobs lost due to efficiency gains.

[singlecoil]

AJS- said:

Your original post said you were calling bullst on the job creation claim. ASDA issued a press release saying they are creating 5,000 jobs, meaning they are hiring 5,000 people who they didn't employ before. Not adding 5,000 jobs to the economy as a whole. That isn't ASDA's business.

Nor is it part of the BBC's business to promote Asda on the breakfast televison news, and yet they did, with the clear implication that Asda was creating new jobs, and not just Asda jobs.

AJS- said:

singlecoil said:

Well, if those redundancies were caused by them closing supermarkets, I imagine there would be much rejoicing in those areas amongst the businesses that were best placed to supply the demand created, and if those businesses were less efficient, then quite possibly more than 5,000 jobs would be created.

Does appear to me to be bemoaning jobs lost due to efficiency gains.

I can't help the way it seems to you. Perhaps if you had left the context in (the quote I was replying to) the meaning might be clearer, and it certainly doesn't mean what you are taking it to mean.

[DonkeyApple]

AJS- said:

ASDA issued a press release saying they are creating 5,000 jobs, meaning they are hiring 5,000 people who they didn't employ before. Not adding 5,000 jobs to the economy as a whole. That isn't ASDA's business.
.

Although I would say that they are not creating 5000 new jobs but retitleing an existing role so that the next batch of standard turnover replacement staff appear to filling new positions rather than replacing an old one.

So, Gladis the Executive Till Operator leaves as she is having a baby and Ethel joins the firm as a Customer Processing Speciallist but strangely is sitting at Gladis' till doing a remarkably identical roll. Yet the firm can announce that it has stream lined and made more efficient the Executive Till Operater role which aggressively expanding the essential Customer Processing Specialist team to cope with customer needs.

[Digga]

DonkeyApple said:

I wrote a lengthy bit on a Tescos thread explaining how analysts and therefore investors monitor 'growth' at supermarkets and it is not remotely how people will think it is measured.

Yep, the primary business of likes of Tescos is selling shares and growing forever bigger. No wonder small businesses can't compete.

I guess too that staff churn is so high they need the odd boost to publicity to keep the supply of new meat at times.

[JontyR]

P-Jay said:

I can see the OP's point, ASDA former parent company Wal Mart was well known in the US for moving into an area, creating 100's of new minimum wage, zero benefits jobs at the same time as destroying the local economy and ending many more higher paid jobs.

The locals would usually be up-in-arms about it, but still flocked to mega store to save money.

But the UK economy is already well developed / ruined depending on your point of view. Small independent businesses are few and far between in the retail sector. A new ASDA usually means your local Tesco / Sainsbury's / Aldi will be a little quieter on a Saturday afternoon.

As someone mentioned in another thread once, the way the supermarkets report their performance to year-end investors is all about market share and total item sales, rather than profit margins so we can expect all of the big players to continue to open new stores and extend current ones as fast as possible for the foreseeable future.

You should come over to Melksham!

I live close to the place, and there we have a Sainburys, Waitrose (was a Somerfield), Aldi, 3 Co-ops, Lidle, Tesco express, and now an Asda! There was turmoil when the new Asda opened. The roads were chaos, queues going back miles! The opening day had lines of people queuing up outside.

All of the others....you had to step over the tumble weeds to get to the check out!

McD's has just announced it is creating new jobs.....so my thoughts are:
We were once famed for our Manufacturing, then we ditched that for Finance, are we now becoming a nation of food retailers?

[F i F]

singlecoil said:

F i F said:

considering High St rents and council rates.

I felt I should draw attention to the fact that business rates, although collected by the local council, actually go to central government. They are a fixed (by central government) proportion of the market rent, so it's the rents that are the problem.

Fair comment about business rates going to central rather than local funds, BUT, for example Pershore has frozen business rates, and all small businesses with a rateable value under £6000 will pay no business rates until some time in 2013. Not sure how this works, maybe it's some rural relief system.

Also business rates are due to rise by 5.6% in April because of the high RPI(?) figure last year.

This article opines that rates are a problem, and suggests that "In recent years, landlords have started negotiating on rent, but rises in rates have been relentless."

So to be objective about this, apart from the small technical error or referring to business rates as council rates, my point pretty much stands firm, i.e rents and rates are a big part of the problem.

[singlecoil]

F i F said:

So to be objective about this, apart from the small technical error or referring to business rates as council rates, my point pretty much stands firm, i.e rents and rates are a big part of the problem.

But if the rents are reduced, they will have no choice but to reduce the rates, as long as rates are tied to market rents, then it needs to rent to go down before the rates can be reduced. I do agree that having to stump up 40 odd percent of the market rent in tax (rates) is a big part of the problem.

[Digga]

singlecoil said:

F i F said:

So to be objective about this, apart from the small technical error or referring to business rates as council rates, my point pretty much stands firm, i.e rents and rates are a big part of the problem.

But if the rents are reduced, they will have no choice but to reduce the rates, as long as rates are tied to market rents, then it needs to rent to go down before the rates can be reduced. I do agree that having to stump up 40 odd percent of the market rent in tax (rates) is a big part of the problem.

In why case why not argue that rates are actually set too high? They are, after all, at an arbitrary level.

Rents cannot easily drop on premises that have already been bought/mortgaged and need a senisble yield without landlords going bust or deserting the high street in droves.

[DonkeyApple]

Digga said:

n why case why not argue that rates are actually set too high? They are, after all, at an arbitrary level.

Rents cannot easily drop on premises that have already been bought/mortgaged and need a senisble yield without landlords going bust or deserting the high street in droves.

Socially, it would be smarter to burn out the weak landlords so as to have cheaper rents for shop keepers/employers.

[singlecoil]

Digga said:

singlecoil said:

F i F said:

So to be objective about this, apart from the small technical error or referring to business rates as council rates, my point pretty much stands firm, i.e rents and rates are a big part of the problem.

But if the rents are reduced, they will have no choice but to reduce the rates, as long as rates are tied to market rents, then it needs to rent to go down before the rates can be reduced. I do agree that having to stump up 40 odd percent of the market rent in tax (rates) is a big part of the problem.

In why case why not argue that rates are actually set too high? They are, after all, at an arbitrary level.

Rents cannot easily drop on premises that have already been bought/mortgaged and need a senisble yield without landlords going bust or deserting the high street in droves.

Well, because the rates are a tax, and the tax is based on the general idea that if people can afford the high rent, then they can afford to pay tax on it. Same idea as income tax.

I can well understand the LLs' point of view, they don't see why they should reduce the rent on properties they have paid a lot of money for, and as long as they can get it, why not ask a high rent? The trouble comes when they can't get it, and rather than reduce the rent, they will leave the properties empty.