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Dixons Issues Profit Warning On Weak Consumer Spending

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http://uk.finance.yahoo.com/news/Dixons-issues-profit-warning-tele-1116258237.html?x=0

Dixons issues profit warning on weak consumer spending
Amy Wilson, 9:27, Wednesday 30 March 2011
Dixons, Britain's biggest electricals retailer, has warned profits will miss most market forecasts because consumer spending has weakened further since the start of the year.
The owner of Currys and PC World said: "Since the announcement of the Group’s trading statement on January 13, as has been well documented,
consumer confidence across a number of our markets has deteriorated
, particularly in the UK and Ireland (Berlin: IIK.BE - news) ."

http://uk.finance.yahoo.com/news/Co-op-sees-no-consumer-reuters_molt-1105365613.html?x=0

Co-op sees no consumer recovery until 2012
8:22, Wednesday 30 March 2011
LONDON (Reuters) - The Co-operative Group, the biggest mutual retailer, does not expect a recovery in consumer spending until next year, it said on Wednesday, as it posted a jump in annual profit thanks to acquisitions.
"We had hoped to see signs of economic recovery by the start of 2011, but the
downturn is clearly biting deeper than we had expected,"
Chief Executive Peter Marks said.

The economy does seem to be heading down fast now which may be behind the bullish sentiment for sterling and consumer related stocks this morning. :D

Currencies

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Meanwhile in Germany which focused on manufacturing and engineering... 3 month around the world waiting lists for BMW's, Mercedes.. 6 month waiting lists for Audis. All at full retail selling prices or above.

http://www.autoblog.com/2011/02/13/audi-buyers-wait-months-for-cars-as-plants-cant-keep-pace-with/

Bloomberg reports that Audi is struggling to meet demand for the A3 and A6, with buyers waiting three to four months to take delivery of those models. Audi sales boss Peter Schwarzenbauer tells Bloomberg that its factories are running at full throttle and that if sales continue to grow it will be "difficult to say how long it could take to reduce waiting times."

So why aren't car buyers leaving Audi for the likes of BMW and Mercedes-Benz? The line for Germany's other luxury makes can be just as long. All three automakers reported record sales in January, and that's with buyers waiting up to six months for hot new vehicles like the new BMW X3. While all three German luxury struggle to keep pace with demand, experts say Audi is in the toughest spot, with wait times up to two months longer than its competitors.

One question I have is what are they expecting to change in 2012. Is your average Brit expecting generous wage increases around that time?

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One question I have is what are they expecting to change in 2012. Is your average Brit expecting generous wage increases around that time?

You see this over and over again. Statements regarding the future of businesses/industries/markets with no justification of why it should happen, but when it doesn't 'happen' you get the old favourite 'unexpected'!

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Meanwhile in Germany which focused on manufacturing and engineering... 3 month around the world waiting lists for BMW's, Mercedes.. 6 month waiting lists for Audis. All at full retail selling prices or above.

http://www.autoblog.com/2011/02/13/audi-buyers-wait-months-for-cars-as-plants-cant-keep-pace-with/

One question I have is what are they expecting to change in 2012. Is your average Brit expecting generous wage increases around that time?

Agree with all of that. But how does this explain our AAA rating, soaring pound against a basket of majors, FTSE rise on the bad consumer news (FTSE consumer related stocks)?

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You see this over and over again. Statements regarding the future of businesses/industries/markets with no justification of why it should happen, but when it doesn't 'happen' you get the old favourite 'unexpected'!

On another forum they say 'drink' everytime the media uses the word 'unexpected' along with negative economic news.

Its part of the subtle bias I was talking about in Miko's thread, the subtle bias that the media is always putting a super optimistic view on the economic future.

It would sound far more dire if they said the economy has turned downwards and barring some fundamental change will continue to move downwards.

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Hardly surprising given the fact that most of what they sell can be bought cheaper elsewhere. Just pick a model of telly/hi-fi and compare it to richer sounds.

I've also found currys/pc-world to be hopeless at customer service. I've been looking at tellys. They have sales people who rarely have any idea of the technical details of their stuff. I think most of them are aspiring/failed estate agents given the volume of hair gel used.

Edited by the stig

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Agree with all of that. But how does this explain our AAA rating, soaring pound against a basket of majors, FTSE rise on the bad consumer news (FTSE consumer related stocks)?

The stocks could simply be banks lending money to hedge funds who are buying shares.

For AAA rating I don't think the agencies could ever downgrade US or UK debt. It basically is the basis of the world capitalist system.

For the Pound the basket is basically the US dollar and the EUro. If you compare to say the Canadian dollar its a different story. Up over 2.4 CAD per GBP in 2004.. now 1.6 CAD per GBP in 2011. Of course week to week there is a lot of variation, but over the long horizon the chart is trending.

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Walesonline has the headline 'Currys owner issues property alert'.

I can't tell you the shock and anguish I felt upon reading that. I feared for my jalfrezis. Thankfully it is only some electronics firm.

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I've also found currys/pc-world to be hopeless at customer service. I've been looking at tellys. They have sales people who rarely have any idea of the technical details of their stuff. I think most of them are aspiring/failed estate agents given the volume of hair gel used.

I'm afraid they do their recruiting from the shallow end of the gene pool.

I once needed to change a plug in a Dixons to demonstrate that a product didn't work. I asked for a screwdriver and despite being an "electrical store" there wasn't a screwdriver in the whole place. They're just box shifters; and bizarrely you're not allowed to open the box to look inside before you've paid! The pig must be purchased in a poke.

They've adopted a business model which boosts profits in the very short term: cheap staff, no training. But longer term you go bust while Maplins takes your customer base with lower prices AND staff who know technical stuff.

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But longer term you go bust while Maplins takes your customer base with lower prices AND staff who know technical stuff.

Blimey I've never considered Maplins cheap. Their technical knowledge however is pretty good I'd agree as they're staffed by nerds like me !

I bought a tv the other year, I only used Dixons to check out the connections, and to have a look at the picture quality. I bought the same model off Amazon for £200 less....

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Hardly surprising given the fact that most of what they sell can be bought cheaper elsewhere. Just pick a model of telly/hi-fi and compare it to richer sounds.

I've also found currys/pc-world to be hopeless at customer service. I've been looking at tellys. They have sales people who rarely have any idea of the technical details of their stuff. I think most of them are aspiring/failed estate agents given the volume of hair gel used.

Always cheaper places and the almalgamation of their chains has presumably cut some costs but maybe confused the public about what the shop is - pc world is full of TVs and doesn't inspire confidence to anyone with a tiny bit of knowledge about technology. There's also fewer actual shops - how many people would have previously walked round all three shops to price match?

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Blimey I've never considered Maplins cheap. Their technical knowledge however is pretty good I'd agree as they're staffed by nerds like me !

I bought a tv the other year, I only used Dixons to check out the connections, and to have a look at the picture quality. I bought the same model off Amazon for £200 less....

Yep - unless you are in a massive rush to drive it away then and there (assuming of course they have it in stock) all most high st electricals retailers are good for is acting as unpaid showrooms for internet shops. Ok, so sometimes you have to match up their versions of model numbers, but broadly speaking thats how it works. Their premium to get worse immediate consumer protection is just laughable. Distance selling regs ftw every time.

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Agree with all of that. But how does this explain our AAA rating, soaring pound against a basket of majors, FTSE rise on the bad consumer news (FTSE consumer related stocks)?

You only need an explanation if you live under the delusion that the markets you mention above are both free and rational.

They are neither.

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http://uk.finance.yahoo.com/news/Retail-sales-rise-reuters_molt-830729325.html?x=0

Retail sales
rise
unexpectedly in March - CBI

Co-op, Dixons, Curry are wrong......dead wrong.

Dixons is a dinosaur, online competition is going to eat them alive. Best Buy is also expanding (http://www.guardian.co.uk/business/2011/mar/28/best-buy-new-store-openings). The business is doomed long term; there is no longer a need or market for high street electrical shops.

The Co-Op is god awful as well, like a rubbish version of M&S / Waitrose. Waitrose is 8% y/y like for like and Ocado 25%. Only select groups of customers affected by the slowdown..

(http://www.johnlewispartnership.co.uk/Display.aspx?&MasterId=30f0a41a-eec7-45ef-91f6-c10dc0cdf398&NavigationId=820)

(http://www.guardian.co.uk/business/2011/mar/04/ocado-sales-rise-25-percent-despite-consumer-slowdown)

The consumer spending "slow down" seem to be excuse of the month for businesses that are failing despite others in the same industry roaring ahead.

No one is expecting or should want the consumer to drive the economy going forward. More debt MEW and HPI can only lead to bust.

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Dixons is a dinosaur, online competition is going to eat them alive. Best Buy is also expanding (http://www.guardian....-store-openings). The business is doomed long term; there is no longer a need or market for high street electrical shops.

The Co-Op is god awful as well, like a rubbish version of M&S / Waitrose. Waitrose is 8% y/y like for like and Ocado 25%. Only select groups of customers affected by the slowdown..

(http://www.johnlewis...avigationId=820)

(http://www.guardian....nsumer-slowdown)

The consumer spending "slow down" seem to be excuse of the month for businesses that are failing despite others in the same industry roaring ahead.

No one is expecting or should want the consumer to drive the economy going forward. More debt MEW and HPI can only lead to bust.

you need to add market share to your theory.

dixons is the largest...a drop of 1% for them may need a 25% increase from a smaller retailer to make up.

we need to know whole market figures.

Another point is that as retailers go bust, for example bennets electrical recently, that their customer base may well have consisted of Dixons haters, so as they have gone, their customers would move to a rival rather than back to Dixons.

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I'm afraid they do their recruiting from the shallow end of the gene pool.

I once needed to change a plug in a Dixons to demonstrate that a product didn't work. I asked for a screwdriver and despite being an "electrical store" there wasn't a screwdriver in the whole place. They're just box shifters; and bizarrely you're not allowed to open the box to look inside before you've paid! The pig must be purchased in a poke.

They've adopted a business model which boosts profits in the very short term: cheap staff, no training. But longer term you go bust while Maplins takes your customer base with lower prices AND staff who know technical stuff.

Lol good one, shallow end of the gene pool. :lol:

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Agree with all of that. But how does this explain our AAA rating, soaring pound against a basket of majors, FTSE rise on the bad consumer news (FTSE consumer related stocks)?

Nearly 70% of FTSE profits are earned overseas, and as global and emerging markets recover the FTSE recovers with them and buys sterling to repatriate profits. Regarding our AAA rating, tough talk about deficit reduction plays very well to the ratings agencies, whether austerity at this point in the business cycle actually works (and proves Keynes wrong) we'll have to wait and see.

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Dixons is a dinosaur, online competition is going to eat them alive.

For the UK I'd tend to agree, but internationally other electrical retailers, such as MediaMarkt/Saturn, are doing pretty well.

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you need to add market share to your theory.

dixons is the largest...a drop of 1% for them may need a 25% increase from a smaller retailer to make up.

we need to know whole market figures.

Another point is that as retailers go bust, for example bennets electrical recently, that their customer base may well have consisted of Dixons haters, so as they have gone, their customers would move to a rival rather than back to Dixons.

I can't believe that people are seriously contending it's lost market share to Maplins/Richer Sounds or it's upset it's customers with it's troupe of spotty socially awkward teenage staff - that have been synonymous with the brand for as long as I can remember.

People are always quoting customer service but, frankly, it's completely undervalued by customers. There is little point investing in customer service rather than offering the lowest ticket price.

There'll be much wailing when it's all gone online and I think it'll will be increasingly unlikely customers will continue to receive the levels of consumer protection they enjoy today.

And 'they should do what John Lewis is doing' is a numpty argument too.

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This is how most people shop now:

1) Find product you want to buy

2) Find cheapest price through price comparison site

3) Search for online voucher discount code

4) Check cashback site to see if you can get extra money off

RIP of Birtain is losing its ability to rip customers off.

Gone are the days when middle aged retards walk into a shop and buy something at premium price because some spotty salesman tells them it's a great product and then pay extra on top of that for protection you will never need.

Shops like Dixons, Game, HMV will all go bust.

So will companies like Yell who are now insignificant as nobody ever looks up the yellow pages anymore (can't remember the last time I did anyway).

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DSGI Remuneration 2009 to 2010

John Browett £900,000 to £1,570,000 (+74%)

Nicholas Cadbury £412,000 to £839,000 ( +103%)

If they had only paid peanuts they would have got monkeys.

Annual report including the director's share awards

http://www.dsgiplc.com/Uploads/%7Bb1ce5112-673c-45f2-a4cd-989bab7feda2%7D/DSGi%20Bookmarked%20PDF%20for%20Corp%20Website%2015.07.2010.pdf

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DSGI Remuneration 2009 to 2010

John Browett £900,000 to £1,570,000 (+74%)

Nicholas Cadbury £412,000 to £839,000 ( +103%)

If they had only paid peanuts they would have got monkeys.

Annual report including the director's share awards

http://www.dsgiplc.com/Uploads/%7Bb1ce5112-673c-45f2-a4cd-989bab7feda2%7D/DSGi%20Bookmarked%20PDF%20for%20Corp%20Website%2015.07.2010.pdf

they must be worth it.

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  • 311 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
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      • Even
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      • up 5%



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