Archive
End of the road for the Black cab
As has been widely reported, Manganese Bronze the manufacturers of the classic London Black cab has collapsed into administration See here
Whether this means the end of this particular brand, its too early to tell but it would appear that the business has been the architect of its own downfall
Most significantly, the recall of hundreds of vehicles cost the business at least £10m. Much has been made of the fact that this recall was spurred on by the failure of Chinese manufactured parts and without wishing to sound xenophobic, its would appear to be a reasonable point
The fact is that for all China’s success in many areas of manufacturing, it is not perhaps the market to go to for parts which would be crucial to a vehicle that would be subjected to heavy usage. You do wonder if sourcing the parts in say, Germany would have been preferable
Further to that, it would also appear that the whole recall issue was handled in a high handed manner.
And there is one last point to consider. The failed parts have brought the business to its knees so you may imagine that compensation should be sought from the supplier
In China? Forget it
TMA – the future of asset finance
Attended a very interesting seminar on asset finance last night. It was hosted by the TMA http://www.tma-uk.org/
The presenters were pretty heavy hitting and certainly knew their stuff and there was plenty to take on board. But heres a few interesting bullet points on the future of asset finance as seen by senior guys at LLoyds, PWC, Burdale and Hilco.
1. The drift from business overdrafts towards asset financing (largely on debtors) will continue apace. Banks hate overdrafts
2. The large banks will, for the foreseeable future, really only be comfortable with “vanilla” deals. The complex and slightly higher risk market will remain largely with the independents still
3. Expect more players in the independent market
4. Asset financing will reach beyond pure debtors. In the US, stock finance is more prevalent but here we do have tighter ROT (retention of title) laws which restrict the ability to finance this area
5. Intangibles are increasing been taken seriously. Again in the US, the value of a brand is seen as an asset that can be financed. Here there is still some reluctance, but the following the collapse of MFI (as one example), it was found that the bulk of the value was simply in the brand
6. The recently publicised campaign for legislation in the market would. if successful, lumber the independents with hefty costs which would be passed onto the market or lead simply to failure. PWC estimated we are talking about a minimum of £2.5m p/a in costs per provider. It wont happen….
A fine seminar. Certainly I would recommend to anyone involved in the industry
John Bulmer
I made reference to some fine photography in previous entry. Well now I have found the full collection.
http://www.johnbulmer.co.uk/
Its grim up north
Euler Hermes have produced a survey indicating that business insolvencies are running at higher levels in the north than in the south. See here
Now it would be remiss of any credit manager to use regional prejudice as an big factor in a credit decision but it perhaps a small element worth considering. Certainly London’s economy is seen as bearing up strongly compared with outside the M25 and even there a couple of recruitment specialists (always a good weathervane) have indicated that the m4 corridor is recovering well
Why Manchester (second worst city) is struggling i’ve no idea. Perhaps if it stopped raining that would help
ps. The photo used for this is from a particularly evocative series on the North of England. Link is here
Blackberries gone sour
What has happened to the Blackberry? It would appear that in the US the decline is terminal
I have the new Bold Smartphone and whilst its an improvement on the previous incarnations and still has the great keyboard, overall the phone disappoints on a number of levels. I wont bore you with the details, but the iphone users are envied
Research in Motion have posted some poor financials in recent times and would appear to be experiencing difficulties in launching their new range. More damaging still were the difficulties experienced with the service last year.
A client of mine is owed a reasonable sum from RIM and are nervous. In truth their balance sheet is fine but the long term picture is not promising
Financials, service, launches are all significant factors but are they are vital as the lack of desirability for the product?
We shall see
Two banks that need to get a grip…
I wont name them but two calls this morning i shall recount
1. A “research company” conducting a survey on a invoice financier’s service and products. Fair enough but the question quickly led to “who else do you deal with?” After being a bit cagey i said ok, I will tell you. And then “what are the negatives of dealing with these financiers?”
Whoa. No no no. You find that out for yourself.
What a nerve….
2. Called a bank that invoice finances overseas but i was unsure whether they were still in UK market. They did not appear to be. Client was curious about there appetite for business and had good dealings with them before
“Can you put me through to your invoice financing division?”
“whats that?”
“invoice financing. You finance invoices”
” can you describe it to me”
“no”
“ill put you through to customer service”
“thanks”
Line went dead
JJB Sports. Points to consider
A client of mine is considering extending credit to a small chain of retailers in the west end. We have been discussing how to go about this and with the business being a just a year old with no filed accounts, there is little to go on. The buyer has offered 50% upfront and post dated cheque for remainder. Seems fair but should we go with it?
I suggested we look at the store. Quite simply are they busy? Does it look permanent? Is there a good level of service?
Relevant to a credit decision? Of course
Whats this got to do with JJB? Well the word was that their stores have been like morgues for some time now. And we know what happened next.
That, allied to the poor accounts, was a clear sign of trouble but perhaps more significant was that this slow death was not accompanied by any suitors for the business. There was a defeaning silence from rivals or knights in white armour.
So we are where we are but guess who is seemingly the least happy. Its the landlords again. Read this and let me know how sympathetic to their plight you feel
Cpcmcredit Blog 