In my role as CEO at Monsoon and Accessorize, I’m usually completely focused on just creating beautiful clothes and accessories, not what the Government does.
We’ve got 150 stores and 2,000 employees in the UK, and many more that depend on us in our international markets and through our supply chain. Retail is a tough game.
Over the past 50 years the business has had some great successes and also weathered some storms. But our latest challenge is quite different.
It’s not changing consumer tastes, it’s not competition, it’s not even the economy – it’s the Government.
For retailers, the recent Budget was not just disappointing, it was a shock.
Ahead of the Budget, we had already seen new employment regulations that will drive up our costs and were prepared for the next round of minimum wage increases and (against all hope) the next ratchet up of business rates.
In my role as CEO at Monsoon and Accessorize, I’m usually completely focused on just creating beautiful clothes and accessories, not what the Government does. Pictured: Nick Stowe
We’ve got 150 stores and 2,000 employees in the UK, and many more that depend on us in our international markets and through our supply chain . Retail is a tough game. Pictured: An Accessorize store
The Government promised business a partnership focused on growth, the growth needed to raise living standards and fund borrowing to improve public services. Pictured: A Monsoon store
But we had not prepared for the Chancellor’s National Insurance rise. Retail is the largest private sector employer in the UK.
This tax rise will hit us particularly hard and will directly affect our employees. Retail profit margins are extremely thin: we cannot just absorb these costs.
We are left trying to rework commitments we have already made – holding back hiring, cancelling wage increases, diverting cash that would have otherwise been invested in stores, and raising prices.
None of these are actions we want to take or that will help grow our business. But we are now forced to choose between least bad outcomes.
The Budget was also confusing.
The Government promised business a partnership focused on growth, the growth needed to raise living standards and fund borrowing to improve public services.
It is absolutely right to make growth the central mission. But the Chancellor has chosen instead to fund the Government’s spending by taxing businesses more for each of their employees.
They’ve chosen to make businesses less profitable and make investment less attractive. That’s not a partnership for growth – it’s counterproductive and a missed opportunity to take the country forward.
– Nick Stowe is the chief executive of High Street fashion stores Monsoon and Accessorize
