Today’s news in brief-16/1/25
The UK economy experienced modest growth in November 2024, with GDP rising by 0.1% following two months of decline. This upturn was driven by a 0.1% increase in services output, primarily bolstered by a 2% rise in accommodation and food services. Consumer-facing services grew by 0.5%, while wholesale and retail trade advanced by 0.5%, reflecting increased activity in wholesale trade. However, administrative and support services saw a 1.2% contraction. Despite the slight recovery, challenges such as rising national insurance contributions and potential inflation surprises remain, though moderating inflation has sparked hopes for interest rate cuts.
A new initiative, High Streets UK, has been launched to address key challenges faced by flagship high streets, including retail crime, high business rates, and restrictive planning laws. Representing over 5,000 businesses and contributing £34.7bn annually to the economy, the group includes Business Improvement Districts from major cities such as London, Birmingham, and Edinburgh. Chair Dee Corsi emphasised the potential of thriving high streets to drive growth and foster community engagement. The group aims to collaborate on policies and programmes to secure the future of these economic hubs.
Poundland’s parent company, Pepco Group, is prioritising efforts to revive the discount retailer after a 7.3% drop in like-for-like sales during Q1. The decline was attributed to underperformance in clothing and general merchandise, alongside a competitive FMCG market and rising operational costs. Despite setbacks, Pepco and Dealz brands performed well, marking a mixed quarter for the group.
Tesco has appointed Francesca Jones, formerly Deliveroo’s head of strategy, to lead its Whoosh delivery service. Jones, who joined Tesco amid a record-breaking Christmas performance, brings expertise from her tenure at Deliveroo and Aldi. Tesco’s Whoosh, launched in 2021, has grown significantly, now operating in over 1,400 express stores. The service contributed to Tesco’s robust festive season, where online sales rose by 10.8%, underlining the strategic importance of the rapid delivery platform as Tesco continues to innovate in the competitive grocery market.
Dunelm recorded a 1.6% revenue increase in Q4 2024, reaching £490m, with total revenues for H1 climbing to £894m. This growth was fuelled by a 3% rise in online sales, which now account for 39% of the retailer’s total turnover. Dunelm’s furniture categories, including sofas and dining chairs, performed particularly well. The company has also expanded its footprint, acquiring 13 stores in Ireland and opening its first inner London store.
The Co-op has launched a new value campaign to highlight its commitment to reducing prices on over 200 essential items across its 2,400 stores. The initiative aims to shift perceptions around affordability while driving new memberships. Building on the platform “Owned By You. Right By You,” introduced in mid-2024, the campaign underscores the retailer’s focus on value amid growing consumer demand for lower prices.
