The current state of UK commodity prices

brexit economy Sep 03, 2019

Ongoing fears of a global economic recession, not to mention the escalating trade war between the USA and China, are having an impact on commodity prices.

August has been a particularly torrid month, according to analysts, with iron ore prices in particular suffering a sharp drop – up to 30% according to a report in the Financial Times, although other sources also back this up.

The ongoing uncertainty has also had its effect on oil prices, with OPEC cutting production while the USA has increased theirs. This has had its impact on the futures price of oil, with Brent Crude for October falling 31 cents, or 0.5%, to $60.18 a barrel.

According to the latest analysis from Marketwatch.com, published on August 30, “Commodities will end August with a second straight monthly loss”.

It says that the S & P GSCI index, which tracks 24 commodities across five sectors was down by more than 4% at the end of August, following a fall of 7% in July.

Gold and Silver prices, on...

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SMEs, start-ups and ethical fundraising

Fund raising can be a challenge for SMEs and start-ups but there are signs that many are turning to ethical fundraising for their money.

This growing trend is particularly pronounced among younger business founders and entrepreneurs, many of whom are reportedly shunning the venture capital routes that focus primarily on forcing them to grow as fast as possible to generate returns.

With the issues of global warming, climate change and damage to the environment being a major factor among young people it is no surprise that ideas of sustainable growth and ethical sources of finance should be so appealing.

But are they narrowing their options by focusing on ethical fundraising and risking their prospects for growth and possibly their business survival?

It would seem not, according to analysts, as there is also a growing movement among investors, particularly retail investors, to search for investment opportunities specifically with ethical funds.

Lisa Ashford, chief executive of Ethex,...

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Is gender parity in business a utopian dream?

employees women Aug 27, 2019

Rarely a week goes by when some aspect of gender parity often defined as equality is not in the headlines.

Back in April, just ahead of a Government deadline for firms to report on the gender pay gap within their businesses, the BBC reported that nothing much had changed since the initiative was announced.

Its analysis revealed that fewer than half the UK’s biggest employers had succeeded in narrowing their gender pay gap. In fact, in 45% of firms the discrepancy in pay increased in favour of men and overall in 75% of businesses the gap was in men’s favour.

By July, the focus had shifted to the representation of women on the boards of FTSE100 and FTSE 350 companies. While representation of women on FTSE100 company boards had improved since 2011, from 12.5% to 32% according to the Hampton-Alexander review, many of the leading broadsheets were accusing businesses of adopting what they called a “one and done” policy and that any such “improvements”...

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Post Brexit boom sectors – business opportunities

brexit sme smes Aug 22, 2019

It is often said that there are winners and losers for every significant event, so which are the post Brexit boom sectors likely to be?

Perhaps the most obvious ones are likely to come from the increase in regulation and compliance requirements for businesses, particularly those in the export sectors.

It is in this area, according to IW Capital, there are opportunities for companies that can devise technology to reduce the amount of time businesses will have to spend on complying with the inevitably more complex requirements that will be imposed by other countries within the EU, but also more widely as businesses explore markets they have perhaps not previously considered.

The exchange rate is likely to have the greatest impact on winners and losers.  Therefore, firms that supply essential goods and services with UK supply chains whose costs are not affected by exchange rates and who do not rely on foreign labour ought to be huge beneficiaries, especially when their...

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UK productivity – is it time to move to a four-day working week?

economy productivity Aug 20, 2019

The UK’s comparatively low productivity and how to improve it has long been a source of debate and analysis.

The ONS (Office for National Statistics) has reported a reduction in UK productivity for three successive quarters and according to the Resolution Foundation productivity is now 28% below the average rate before the 2008 financial crisis.  Yet this is a time when employment levels in the UK are the highest they have ever been.

Business productivity has traditionally been calculated by dividing average output per period by the total costs incurred (capital, energy, material, personnel) consumed in that period and is used as a determinant of efficiency.

Productivity in both national economies and individual businesses is much scrutinised by governments, business commentators and business owners as an indication of performance, efficiency and economic health.

All of this is based on the assumption that perpetual growth and competition are the cornerstones of...

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Work experience – between a rock and a hard place

employment Aug 15, 2019

Earlier this year the Federation of Small Businesses (FSB) called for compulsory work experience to be reintroduced for all children aged 14 to 16.

The Government ended schools’ obligation to provide compulsory work experience in 2012.

Since then, although many schools do still try to arrange some work experience, the responsibility for finding placements has rested largely on parents and pupils themselves.  In fact, according to the organisation Changing Education “Ofsted has identified that 75% of schools are failing to provide adequate work experience programmes”.

In 2015 the British Chambers of Commerce (BCC) questioned the wisdom of the 2012 decision, following a study of members that found that “most firms and education leaders believe secondary schools should offer work experience for under 16-year-olds”.

John Longworth, who was then the director general of the BCC, said: “Business and school leaders are clear – we won’t...

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The current state of the commercial property sector

brexit economy Aug 13, 2019

With economic uncertainty prevailing both globally and in the UK it would be no surprise if the commercial property sector was facing some difficulties.

The commercial property sector covers Community, Education, Hotel, Healthcare, Office, Retail and Industrial and it is clear from some of the statistics that the woes of retail have been acting as a drag on the sector as a whole.

Jones Lang LaSalle (JLL) provides information on property and investment opportunities and in its most recent analysis on new construction starts it revealed that they fell in the first quarter of 2019 for the first time since Q2 2017.

It reports that the ongoing uncertainty “dampened UK commercial real estate transactional activity in Q2, with investment volumes slowing to £8.9bn. This represented a 22% decline on the first half of and was the slowest first half of the year since 2013.

However, it reports, Alistair Meadows, Head of UK Capital Markets, believes that...

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Dream Big – Summer is time for considering a start-up

entrepreneur Aug 08, 2019

As many as half of all workers seriously consider setting up their own business during the summer holiday according to research.

Emma Jones, founder of small business support network Enterprise Nation, said: “The combination of sun, sand, sea and downtime means we’re more relaxed and have time to contemplate what we want.”

Relaxing on a beach with time for reflection can make us aware of any dissatisfactions with our current status or job.  It is also an opportunity to think what else you might do if stuck in a rut and you want to “take back control” of your life.

But what is involved when starting up a new business?

The key is to identify a clear purpose and define the product/market mix for your business, essentially to be able to answer “why” questions. This may require research but you cannot start planning until you have a clear purpose. Turning dreams into reality is more than simply having a good idea!

To help you find your...

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The unpredictable relationship between currency values and stock markets

economy Aug 06, 2019

Too often the assumption is made that when a country’s currency value drops its stock markets will rise as its exports become more competitive.

The current economic situation in the UK and elsewhere is an illustration of why this may be an over-simplistic assumption.

Last week ended with £Sterling at its lowest value against the US dollar for two years at $1.2162 and against the Euro at €1.0948 while at the same time the FTSE100 closed down minus 2.34% at 7407.06.

This suggests that the previous so-called assumptions are no longer valid.

In commenting on this it should be noted that the European, US, Japanese and Hong Kong stock markets also plunged.

What is causing currency values and stock market turbulence?

The signs that both the global and UK economies are volatile and have been for some time. Evidence for this can be deduced from the monetary stimulus by Central Banks.

In May the OECD (Organisation for Economic Co-operation and Development) revised...

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Q2 insolvencies offer no sign of economic storms easing

There are no signs of the pressures on businesses easing off as insolvencies in the second quarter of 2019 (April to June) continued to climb, according to the latest figures released by the Insolvency Service.

While the number of compulsory insolvencies fell, there was a significant increase in the number of CVLs (Company Voluntary Liquidations), which showed a 6.9% increase, an increase of 2.6% in the total numbers of insolvencies compared to the first quarter of the year.

Compared to the same quarter in 2018 the numbers of insolvencies have risen by 11.9%, the highest underlying rate of insolvencies since 2014 according to the Insolvency Service.

It reports that those businesses that have fared worst in the second quarter have been “the accommodation and food service industry with 74 extra cases compared to the 12 months ending Q1 2019 (an increase of 3.4%) and the construction industry with 37 additional insolvencies (a 1.2% increase)”.

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