SHOP

The Problem

Ok, before you read on, flick the kettle on, make yourself a cuppa and get comfortable,.. this may take a while!...

You don’t have to look far to understand the issues we are having in the UK regarding retail. More and more shops are closing on our highstreets and billions are draining out of the UK economy as a result of our new spending habits.

UK retail is on its knees, high street shops are closing, the shops we grew up with and hold close to our hearts are diminishing and most sadly; good, honest, passionate people are losing their jobs and their livelihoods!

We acknowledge that we have to evolve and as a result of evolution there will be sacrifice, but this is not about evolution, neither is it about sacrifice. This is about global corporations dominating and taking advantage and without any acknowledgment to this we’re just floating down a river, with no paddle, oblivious to our destination.

We have identified five areas which make up the problem and we are going to offer our take on each one.

1. Amazon

First of all its important to understand that despite making huge sums of money in the UK Amazon went 11 years without paying any tax. They only started paying tax in 2015 and continue to do so but at incredibly low levels. Read this article from the independent
How Amazon can avoid UK’s new tax on technology companies,
but small businesses will pay

Amazon are actively manipulating the system to ensure they minimise the tax they pay, estimated to be as little as just 2%. 

This money that they are avoiding is the money our government would otherwise spend on our teachers’, our NHS staff, to build hospitals, to look after our elderly and vulnerable and to basically support and preserve everything else that is wonderful about our country.

With this in mind, how Amazon operate is nothing short of a disgrace and yet bizarrely we continue to use them!

It was once cool to say ‘I shop on Amazon’ the problem is, it’s not cool anymore!

Amazon is on its way to creating a monopoly in almost every country in which it operates. They create algorithms, processes, they manipulate our psyche and have little consideration for the lasting impact of their actions both socially and economically.

They justify their presence by saying we have created X amount of jobs, but they never say how many jobs have been lost. The jobs they do create, in most cases, are low paid, production line type roles, in big soulless warehouses, creating a very unhealthy environment for us as human beings.

UK retail will never be able to compete with Amazon due to their dominance and influence socially and the bigger the gap gets (between Amazon style business and UK based retail) the more impossible the task to regain control will be.

It’s not just about evolving from our high street to online, many online businesses are struggling or even failing to keep up with Amazon and it’s development (create a link to this article https://www.kisbridgingloans.co.uk/finance-news/why-amazon-killingour-retail-economy-is-bad-for-everyone/ ), generally we will always be two steps behind and we have to remember…

Amazon doesn’t care

We must remember this, we get blinded by the smiley logos, by the bright colours and the happy staff moving boxes around in the bright, clean and airy warehouse - this is not real! These are adverts, the people you see are actors, this is all part of their marketing strategy.
Amazon is a business, every move it makes has an agenda and that agenda is underpinned by money and greed. Amazon does not care about you, it only cares about your bank details and how it can move your money into their account.

This aggressive approach has resulted in us (the UK) spending £9000 per second on their platform, has resulted in them taking a whopping 30% market share of all online sales and has resulted in Anna Dreda in Shropshire having to close her book store – sadly, there are too may Anna Dreda’s!

So why isn’t the government intervening?

The problem is the government has so many other pressing matters, Covid-19, Brexit, social care, to name a few and so in reality this issue is simply not at the top of their agenda. 

We also have to acknowledge the size of Amazon and their resulting power, for every change the UK government make Amazon will create a solution to avoid, bypass, or mitigate against. We need to accept that Amazon is now worth $1.1 trillion, our government will always be on the back foot when it comes to tackling a corporation like this which has imbedded itself so firmly into our society. It also needs to be considered that the government can’t single out Amazon, they have to create a framework for all businesses to operate fairly and Amazon haven’t really broken any rules.

We therefore have to take personal responsibility, we have to accept that part of the reason our high street is the way it is, is because of our actions and how we spend our money!

Although no doubt sobering to hear, this is a fact however as sobering as it is, it is also incredibly exciting because it means we are in control and we can dictate our future.
Become a Purple Spud, delete your Amazon app and cancel your prime subscription, yes it’s a leap, but make the leap and walk around with your spud held high

2. Supermarkets

The wake-up call was on the 26th June 2020, during the coronavirus pandemic and walking in to Tesco’s to be greeted at the entrance to a basket of facemasks priced at £6.50, This was a price that clearly had a good profit margin for Tesco and so I was left to feel uneasy given what we were all going through. Tesco (and other supermarkets) is one of only a fraction of sectors to thrive during the global pandemic and the resulting lockdown, yet here they were selling an item, that they wouldn’t ordinarily have done and sold at a price to make even more money, the true definition of opportunism! To make matters worse, they were selling to families who would purchase them not to protect themselves but to protect others, including Tesco’s own staff – This highlights the ruthlessness of our supermarkets and if they are willing to do that, what else have they been up to?!

‘Opportunism – the practice of taking advantage of circumstances with little regard for principles or with what the consequences are for others’ (highlighted as a dictionary extract)
Make no mistake, our supermarkets are equally aggressive. What Amazon has done to our book stores and countless other industries, Supermarkets have done before them. Bakers, fishmongers, green grocers, butchers, book shops, stationers, clothes shops, have all at the very least been considerably affected and in many cases, have gone forever. Family businesses who have survived generations, families whose livelihoods were at the heart of family life, good people, who made a good honest living and who brought something considerable to our high streets have all mostly gone.

We acknowledge demands and we acknowledge our lives have changed. Supermarkets have capitalised on this change by giving us convenience, we can now park free of charge, with ease and then go on to do our weekly shop without any need to go anywhere else, we even fill up our car with petrol on the way out. It’s convenient and it’s simple. They do the price matching for us and offer us the reassurance of a price guarantee, they ensure that we ‘save money, live well’ and they ensure we ‘live well, for less’ and of course, they make sure ‘every little helps’. This is their way of subconsciously manipulating us to believe we have made a wise decision without any need to question..
A lot of people condemn Amazon and online shopping and go on to show their frustration at the demise of our high street and how the internet has destroyed it and then they jump into their car and do their shopping in a supermarket!

Make no mistake, our high street started its decline long before the birth of the internet, the fundamental reason for the demise of our highstreets is the supermarket.

It is unfortunate that supermarkets have starved our highstreets as they have, but the reality is that this is probably more about evolution than greed. Our society has created a demand (for convenience), supermarkets have simply supplied.

Despite our acknowledgment, supermarkets and the ruthless way in which they have stripped our highstreets means that we feel it not appropriate to offer any of the products or services they offer. Instead we would ask that if any of you have the time, shop local, find your local butcher, green grocer, fishmonger and once a week take a trip out, say hi and shop with these wonderful people.

3. .co.uk websites

As we migrate across to using the internet more and more to do our shopping we should be aware of the sites we use. We often log onto .co.uk websites and would understandably believe that we are shopping in the UK, but as they say, things aren’t always as they seem!

Let me start by saying most .co.uk businesses are businesses based in the UK and so by supporting them you are supporting the UK economy, but there are many that are not and it’s those that are not which we need to be aware of!
All you need is a UK address and you are able to set up a .co.uk website from anywhere in the world.
Many of you would have heard of VistaPrint, a business which has been offering the UK products online and for many would be their go-to for business cards and many other printable products, The business has now established itself firmly in the UK, yet this business is based in the Netherlands and with every purchase we make we see UK money go directly out of our economy straight into the Dutch economy. 

Vistaprint is just one example, but there are thousands of businesses posing as UK businesses and with our busy lives we rarely take time to check where our money is actually going.

4. Google

Ok so this isn’t just about Google, there are many other search engines available but google is the one which dominates…

The problem with Google is that we only really see what Google wants us to see. Rarely do we venture further than the second page and yet the first two pages are dominated by companies which have either paid to be there or have carefully constructed their websites to be visible high up on your related search.

From a business perspective this platform is great if you have deep pockets or a good understanding of how Google searches work and are able to implement this into your website. Unfortunately, this platform is not great for any businesses who can’t afford to advertise or who don’t have an updated and modern website.

As a consequence, many businesses that may perfectly fit your search criteria are missed, you lose out, unable to find the business which could have been the perfect solution for your search, and the business themselves lose out potentially desperate for your business.

5. Luxembourg (other tax havens are available)

Luxembourg was the tax haven for Amazon right up until 2015, this meant that the 11 years of trading prior to 2015 saw Amazon contribute no tax to the UK economy.

Their move to start contributing (albeit very little) in 2015 was not out of a conscious ethical decision but was one of strategy and mounting pressure.

Tax havens continue to be a very attractive option for global corporates as it enables them to minimise the taxes they pay. This is about greed, there is no personal or ethical responsibility.

Any company that we see based on or has a parent company based in a tax haven prompts alarm bells to ring and in most cases something untoward is going on!
An example of a business operating in this way is Holland and Barrett. Holland and Barrett is a brand that is synonymous with our UK high street and on the face of it has a strong historical presence in the UK. However the company was in fact brought out in 2017 by L1 Retail, a group controlled by a Russian Billionaire. Holland and Barretts parent company is now based in, yes, you’ve guessed it, Luxembourg. According to ‘Ethicalconsumer.org’ Holland and Barrett have many question marks over whether they operate ethically and so for this reason you will not see us support them.

Generally, you will see parent companies based in these tax havens, they charge their subsidiaries based in the uk, management fees (as an example) which will generally swallow up any profit, thus no / little corporation tax is paid. Meanwhile these parent companies show significant profits in the tax haven but these lower jurisdiction areas enable them to hold on to the majority of their profits. 

There is an appetite to resolve the issue of tax havens, governments across the world are trying to work collaboratively to resolve this global issue, however despite there being an appetite, they are still a considerable way off solving this problem and so for now, it will remain a problem for us all.

To summarise

The businesses that are paying tax and operating as they should are generally doing so because they have made sound ethical decisions. The fact that they have made conscious ethical decisions about this, would lead us to believe they are making many more decisions which are ethical, for example, carbon foot print and recycling, staff working conditions and pay, community support. These are good companies, we should support them!

Regarding tax avoidance, we must continuously remind ourselves the knock-on effect this has on our society. When you hear about the NHS struggling, the police under staffed and under funded or social care unavailable to those really in need, the chances are this money could have been available if companies such as Amazon paid the amount of tax appropriate for their operation.

Ready for Action?

Be part of a platform that identifies
and celebrates UK businesses
Shop
linkedin facebook pinterest youtube rss twitter instagram facebook-blank rss-blank linkedin-blank pinterest youtube twitter instagram