Brexit, for once some facts.

[Woosh]

Meanwhile, the pound continues to strengthen meaning that KTM customers will soon see prices fall as the company reverse the price rises blamed on the weak pound.

the Pound rose in recent days because the USD has weakened and the Euro strengthened.
Against the Euro, the Pound is stuck at around 1.14 Euro. No price reduction there.
FYI, the day before the referendum (22-Jun-2016), it was 1.30 Euro.
With hindsight, if we were in the Eurozone, we would not have suffered 3% inflation, brexit related. No wonder JRM and Co have stopped mentioning the Euro.

 

[Danidl]

the Pound rose in recent days because the USD has weakened and the Euro strengthened.
Against the Euro, the Pound is stuck at around 1.14 Euro. No price reduction there.
FYI, the day before the referendum (22-Jun-2016), it was 1.30 Euro.
With hindsight, if we were in the Eurozone, we would not have suffered 3% inflation, brexit related. No wonder JRM and Co have stopped mentioning the Euro.

Thanks Woosh, I had seen Tilson post and could not make much sense from it, as the sterling euro is hovering 1.14 to 1.15 , and this seemed much ado about little. I had not picked up that it was the dollar which had slipped.

 

[tillson]

the Pound rose in recent days because the USD has weakened and the Euro strengthened.
Against the Euro, the Pound is stuck at around 1.14 Euro. No price reduction there.
FYI, the day before the referendum (22-Jun-2016), it was 1.30 Euro.
With hindsight, if we were in the Eurozone, we would not have suffered 3% inflation, brexit related. No wonder JRM and Co have stopped mentioning the Euro.

Yes, I know it’s not doing so well against the euro. But, a lot of the price rises were blamed on the dollar / pound exchange rate because a high proportion of manufacturing takes place in China and they get paid in Dollars. I’m just quoting what was said at the time, but there may not have been much truth in it!

 

[KTM Bike Industries UK]

This isn't surprising since there is a general shift towards on-line shopping, which is backed up by demand for warehousing. The high street has been in decline long before Brexit was even thought of.

Meanwhile, the pound continues to strengthen meaning that KTM customers will soon see prices fall as the company reverse the price rises blamed on the weak pound.

well a) the internet hasn't changed in the last 12 months has it?

"According to the Q4 2017 RICS UK Commercial Property Market Survey demand for retail property fell for the third consecutive quarter, down 22%."

But hey, that doesn't fit your narrative does it?

and b) .... if only it was that simple.

firstly, the RRP is a direct conversation from € trade price, plus the margin we offer UK dealers.

This is the graph for £/€.

http://www.xe.com/currencycharts/?from=GBP&to=EUR&view=5Y

So we're not back anywhere near pre referendum levels yet.

Also don't forget a RRP has to consider a businesses costs that aren't just the purchase of the actual product. For us all our other costs have also gone up by 20%, everything from office coffee, fuel etc etc has gone up.

I've also had to cut our margin to prevent the prices going up more. So on eBikes for instance. Our margin is 1/2 what is was in 2016. HALF.

So please don't try to tell me its not had an impact.

 

[anotherkiwi]

Did you attend any ?

Yes but I am not on TV debates very often these days...

 

[Zlatan]

Even if pound and euro were parity ( as experts said it would be not that long ago) your average shopping bill would still be about same price in France , cheaper in Spain than it would be in UK. Pre ref. the pound was overvalued. Look at price of diesel, petrol,wine beer etc on continent when buying in pounds.
You can still get a good 2 course lunch in Spain, with wine / beer for under £10. ( loads of places around Maroira do menu del Dias for 9 Euro...So pre ref would have been £7.50 ish..now £8.30 or so. ( only guessing haven't calculated)
Point is buying stuff on continent is still cheap...just not as cheap.
Stuff I have to buy (Marine bits and pieces) its still where stuff is sourced rather than exchange rate governing price.( ie some stuff cheaper in Spain, even now, other stuff not)

 

[tillson]

well a) the internet hasn't changed in the last 12 months has it?

"According to the Q4 2017 RICS UK Commercial Property Market Survey demand for retail property fell for the third consecutive quarter, down 22%."

But hey, that doesn't fit your narrative does it?

and b) .... if only it was that simple.

firstly, the RRP is a direct conversation from € trade price, plus the margin we offer UK dealers.

This is the graph for £/€.

http://www.xe.com/currencycharts/?from=GBP&to=EUR&view=5Y

So we're not back anywhere near pre referendum levels yet.

Also don't forget a RRP has to consider a businesses costs that aren't just the purchase of the actual product. For us all our other costs have also gone up by 20%, everything from office coffee, fuel etc etc has gone up.

I've also had to cut our margin to prevent the prices going up more. So on eBikes for instance. Our margin is 1/2 what is was in 2016. HALF.

So please don't try to tell me its not had an impact.

I didn't say that it has had no impact.

I am surprised the demand for retail property has only fallen by 22%. As shopping habits continue to change, retail outlets will suffer more and that decline will probably accelerate. Unless you have a unique product which demands and suits a high street outlet, it would be a high risk venture opening a new shop.

I too have the XC Currency App and it's great. It tells you the exchange rate and everything! Almost immediately after the Brexit vote, £1 plummeted to $1.22. Today, £1 is worth $1.43. That means a crate full of Chinese shite is 17% cheaper than it was on Brexit Boxing Day. That's good news isn't it?

 

[oldgroaner]

And they probably changed the door code immediately upon your departure.

After I left they demolished the 50 acre site!

 

[Danidl]

well a) the internet hasn't changed in the last 12 months has it?

"According to the Q4 2017 RICS UK Commercial Property Market Survey demand for retail property fell for the third consecutive quarter, down 22%."

But hey, that doesn't fit your narrative does it?

and b) .... if only it was that simple.

firstly, the RRP is a direct conversation from € trade price, plus the margin we offer UK dealers.

This is the graph for £/€.

http://www.xe.com/currencycharts/?from=GBP&to=EUR&view=5Y

So we're not back anywhere near pre referendum levels yet.

Also don't forget a RRP has to consider a businesses costs that aren't just the purchase of the actual product. For us all our other costs have also gone up by 20%, everything from office coffee, fuel etc etc has gone up.

I've also had to cut our margin to prevent the prices going up more. So on eBikes for instance. Our margin is 1/2 what is was in 2016. HALF.

So please don't try to tell me its not had an impact.

In fairness there can well be a lag between a reduction in sales and it's effect on commercial property prices . Even if a company suffers reduced sales they are locked into the lease arrangements for a period of time.. The growth in internet shopping must be having a corrosive effect on in store retail sales. , But the lag to property values could be three years

 

[Danidl]

I didn't say that it has had no impact.

I am surprised the demand for retail property has only fallen by 22%. As shopping habits continue to change, retail outlets will suffer more and that decline will probably accelerate. Unless you have a unique product which demands and suits a high street outlet, it would be a high risk venture opening a new shop.

I too have the XC Currency App and it's great. It tells you the exchange rate and everything! Almost immediately after the Brexit vote, £1 plummeted to $1.22. Today, £1 is worth $1.43. That means a crate full of Chinese shite is 17% cheaper than it was on Brexit Boxing Day. That's good news isn't it?

Maybe, but if you are buying your poppet valves or brakes in Frankfurt, for installation in your customised ambulance, not a lot of good. And with QC practices and validated vendors , you cannot be chopping and changing your supplier.

 

[Danidl]

After I left they demolished the 50 acre site!

Decontamination?

 

[Woosh]

In fairness there can well be a lag between a reduction in sales and it's effect on commercial property prices .

demands are much more responsive to changes in market climate.
Demand drives value.

 

[Danidl]

This isn't surprising since there is a general shift towards on-line shopping, which is backed up by demand for warehousing. The high street has been in decline long before Brexit was even thought of.

Meanwhile, the pound continues to strengthen meaning that KTM customers will soon see prices fall as the company reverse the price rises blamed on the weak pound.

A future where the town centre is populated by showrooms, coffee shops and a few chemists and newsagents.?

 

[Danidl]

demands are much more responsive to changes in market climate.
Demand drives value.

Fine, but in Ireland, commercial property is subject to upward only rent reviews... Unless the retailer declares bankruptcy. So the lag is built in

 

[tillson]

A future where the town centre is populated by showrooms, coffee shops and a few chemists and newsagents.?

The closest town to where I live has seen most of the big name high street shops close and move onto retail parks on the outskirts. Some of those are struggling to compete with on-line traders and have also closed.

The size of the retail area in the town centre has shrunk dramatically over the past 50 years. The only shops which seem to be surviving are those offering something unique such as quirky furnishings, high quality butchers, delicatessens, fancy cake shops and bakeries. Then there is the usual smattering of coffee shops, chemists, charity outlets & betting shops.

I don't think there is any way back for many of these vacant town centre shop units and they would be better suited to conversion to flats. Some are in lovely old victorian buildings.

I think it is wrong of KTM man to suggest that Brexit is a big factor in the decline of the high street. That started before we joined the EU, continued whilst we were in it and will carry on after we leave. That's just the way it is.

 

[KTM Bike Industries UK]

I think it is wrong of KTM man to suggest that Brexit is a big factor in the decline of the high street. That started before we joined the EU, continued whilst we were in it and will carry on after we leave. That's just the way it is.

No no no no no. I'm not saying Brexit is a reason for a historical decline in the High Street.

I'm saying its one of the reasons for it getting worse, and its a big part of the sudden increase in decline over the past 12 months.

I know this for a fact, because we supply shops that are closing, and I'm talking to them.

Brexit is essentially the straw that broke the camels back in most cases.

Like this for restuarants... but for bike shops.

http://www.independent.co.uk/news/business/news/brexit-latest-news-uk-restaurants-closing-bust-20-per-cent-leave-eu-a8023576.html

 

[Woosh]

JRM puts his boot in before DD's speech tomorrow as talks start again:

government's tone on Brexit 'needs to fundamentally change' - 'approach seems to be we must accept what the EU will allow us to do...this is no way to negotiate and no way for this country to behave'.

Reality bites, doesn't it?

 

[Zlatan]

No no no no no. I'm not saying Brexit is a reason for a historical decline in the High Street.

I'm saying its one of the reasons for it getting worse, and its a big part of the sudden increase in decline over the past 12 months.

I know this for a fact, because we supply shops that are closing, and I'm talking to them.

Brexit is essentially the straw that broke the camels back in most cases.

Like this for restuarants... but for bike shops.

http://www.independent.co.uk/news/business/news/brexit-latest-news-uk-restaurants-closing-bust-20-per-cent-leave-eu-a8023576.html

No no no no no. I'm not saying Brexit is a reason for a historical decline in the High Street.

I'm saying its one of the reasons for it getting worse, and its a big part of the sudden increase in decline over the past 12 months.

I know this for a fact, because we supply shops that are closing, and I'm talking to them.

Brexit is essentially the straw that broke the camels back in most cases.

Like this for restuarants... but for bike shops.

http://www.independent.co.uk/news/business/news/brexit-latest-news-uk-restaurants-closing-bust-20-per-cent-leave-eu-a8023576.html

When people stop coming through door, or buying online after a recent rise in.price the retailer and his network are bound to think the reason is the higher price. The only way to actually know is speaking to the none buyer. Doesn't seem to me that a price rise in.line with change in value if pound will actually affect what is a luxury item.
Couple of weeks ago was speaking to mate who sells Porsche, he made same comment. If it were case the people bot spending £70k on a Porsche would be crossing road and spending £50k on a merc...price rises do not stop pepple spending...they simply realign their desires more inline with capabilities.
Besides, I was in our local ebike shop and they were reporting loads of sales. ( Got a mate who owns a Campervan outlet in Derby, he,s insists his sales are best ever...which makes sense. The Porsche showroom on the other hand has been deserted on my every visit recently.
I,d rather be selling new campervans at £65k than Porsche Boxsters of similar value at moment.
Think it all depends what you are selling but generally I,d agree confidence is down. Dont agree at all that is down to Brexit.
I,ve been wanting a new windsurf board for a while, decided to buy one. Price was £1260...Same board last year £1099...A change in price of that order is almost irrelevant...( As long as competitor hasn't managed to stay at £1099.???)
Pity I couldn't buy a UK built one. There aren't any. Perhaps Brexit might change that , cant make situation worse. Think its same with ebikes..

 

[Danidl]

When people stop coming through door, or buying online after a recent rise in.price the retailer and his network are bound to think the reason is the higher price. The only way to actually know is speaking to the none buyer. Doesn't seem to me that a price rise in.line with change in value if pound will actually affect what is a luxury item.
Couple of weeks ago was speaking to mate who sells Porsche, he made same comment. If it were case the people bot spending £70k on a Porsche would be crossing road and spending £50k on a merc...price rises do not stop pepple spending...they simply realign their desires more inline with capabilities.
Besides, I was in our local ebike shop and they were reporting loads of sales. ( Got a mate who owns a Campervan outlet in Derby, he,s insists his sales are best ever...which makes sense. The Porsche showroom on the other hand has been deserted on my every visit recently.
I,d rather be selling new campervans at £65k than Porsche Boxsters of similar value at moment.
Think it all depends what you are selling but generally I,d agree confidence is down. Dont agree at all that is down to Brexit.
I,ve been wanting a new windsurf board for a while, decided to buy one. Price was £1260...Same board last year £1099...A change in price of that order is almost irrelevant...( As long as competitor hasn't managed to stay at £1099.???)
Pity I couldn't buy a UK built one. There aren't any. Perhaps Brexit might change that , cant make situation worse. Think its same with ebikes..

When people stop coming into the shop, the retailer may well think that his prices are out of line, but he she might also realise that the customer just has less disposable income and are choosing to use it for literally bread and butter items. This is particularly the case when they have had salary increases less than inflation. And UK consumers have had a currency shift of negative 10% to 20%?? or so over the last two years.
Paradoxically, some luxury's such as coffee shop takings and apparently lipstick sales go up. Little compensations to make up for the more expensive luxuries foregone. When Ireland had our massive crash in 2008, the most immediate visible sign, along with the immediate reduction in the number of cranes in operation, was the reduction in the number of blondes in the workplace. Being blonde except for the natural few is a high maintenance and cost activity.

 

[oldtom]

I think it is wrong of KTM man to suggest that Brexit is a big factor in the decline of the high street. That started before we joined the EU, continued whilst we were in it and will carry on after we leave. That's just the way it is.

No, I can't agree with that as I think his point was that the decline in the status quo in regard to High Street retail outlets has been exacerbated by 'Brexit', further undermining many businesses built on very shaky foundations.

There can be no doubt that the effects of the withdrawal from the EU have already manifested themselves in many ways, not least because imports became far more expensive after the pound dropped in value. Obviously, exporters of home-built goods or other products not requiring imported components may have done very well because of a devalued pound but none of those increased profits will trickle down any further than shareholders' bank accounts.

In another 18 months or two years, we will begin to understand that life has changed forever and when the Japanese withdraw their interest in British-based car-making with the huge collateral effect attaching to that, only then will the knobheads in Sunderland and other areas begin to realise what pillocks they really are.

Please can I have another bowl of sovereignty Master?

Tom