Firm closing

[CrazyDave]

1 hour ago, NoTail said:

I would expect the petrol suppliers to be worried as Tesco will have plenty of space to install pumps.

The implications go way beyond what people are considering.

The trucks shoprite use are purchased locally.  Tesco run their on lease from a UK supplier etc etc.

[CrazyDave]

1 hour ago, WTF said:

maybe they will turn some of the smaller shops into their clothing line outlets ? 

Jeez I hope not.  Take out a load of local clothes shops as well.

[Cueey Lewis And The News]

22 minutes ago, NoTailT said:

My instinct tells me that Tesco will have made this move to protect market share more than anything, as I have no doubt there would be other interested parties.

I’d agree with you. The Nicholson’s would be claiming interest from Aldi’s, Sainsury’s or any other competing group to push the price up for Tescos to buy them out to buy the market. I’d be amazed if they didn’t get a very good deal on the business. Looks like they’ve managed to keep the property portfolio too and lease back with a UK PLC as tenant. They could probably leverage that next - sell all the stores at a high multiple with a cornerstone UK PLC tenant with long leases in place. More money. 

[Manxman1234]

I wonder how much of a hole this will make in government pocket from Loss of VAT and tax on profits in island 

[NoTailT]

21 minutes ago, Cueey Lewis And The News said:

I’d agree with you. The Nicholson’s would be claiming interest from Aldi’s, Sainsury’s or any other competing group to push the price up for Tescos to buy them out to buy the market. I’d be amazed if they didn’t get a very good deal on the business. Looks like they’ve managed to keep the property portfolio too and lease back with a UK PLC as tenant. They could probably leverage that next - sell all the stores at a high multiple with a cornerstone UK PLC tenant with long leases in place. More money. 

I’m completely seeing this from the same perspective.

A robust 21 year lease from a solid UK Plc? Kerching on the assets vs previous shoprite scenario.

[GD4ELI]

1 hour ago, Millman said:

TRI hope you are right. Many of the head office staff have been with the company for many years and quite a number are around or over 50. Lets hope the job market is accodating to their needs and skills and everyone is quickly able to find new work. 

It is really sad to see yet another unique to the island brand go. These brands, all be they far from perfect, are part of our distintive culture. Without doubt without them the Island looses just a little of its sparkle thats makes here so indivdual.

My thoughts also go out the many local suppliers that partner Shoprite. I doubt if all of them will find a home with Tesco. Despite the shiny words of the Cheif minster I think the fall out from this decision will be hard felt in quite a few places and may lead to further consequences. I just hope this is not the case.

Good luck to all those affected.

"It is really sad to see yet another unique to the island brand go."

What exactly is unique about Shoprite? No home deliveries, scruffy stores, ...

Tesco is a bloody good company.

[John Wright]

11 minutes ago, Manxman1234 said:

I wonder how much of a hole this will make in government pocket from Loss of VAT and tax on profits in island 

It’s revenue neutral as far as VAT is concerned. VAT is a shared tax. 

As for tax Shoprite itself wouldn’t pay much tax, 0-10 remember. Tax on dividends in hands of recipients.

Tesco profits on Manx sales are subject to Tesco Tax. So, presumably with 9 extra stores there’ll be more profit and more Tesco Tax.

 

[Happier diner]

2 minutes ago, John Wright said:

It’s revenue neutral as far as VAT is concerned. VAT is a shared tax. 

As for tax Shoprite itself wouldn’t pay much tax, 0-10 remember. Tax on dividends in hands of recipients.

Tesco profits on Manx sales are subject to Tesco Tax. So, presumably with 9 extra stores there’ll be more profit and more Tesco Tax.

 

Tesco tax?

[Happier diner]

46 minutes ago, CrazyDave said:

Jeez I hope not.  Take out a load of local clothes shops as well.

I wouldn't worry, their florence and fred line is crap.

[John Wright]

2 minutes ago, Happier diner said:

Tesco tax?

That’s what it was popularly described as when introduced. It’s 10% on profits over £500k. For the company it’s neutral. It’s set off against tax in UK.

[Happier diner]

Just now, John Wright said:

That’s what it was popularly described as when introduced.

Sorry John, I am being thick I know. What was introduced? 

[John Wright]

1 minute ago, Happier diner said:

Sorry John, I am being thick I know. What was introduced? 

Tesco tax. 2013 budget. 10% tax on profits over £500k for non Manx retailers.

[CrazyDave]

5 minutes ago, John Wright said:

It’s revenue neutral as far as VAT is concerned. VAT is a shared tax. 

As for tax Shoprite itself wouldn’t pay much tax, 0-10 remember. Tax on dividends in hands of recipients.

Tesco profits on Manx sales are subject to Tesco Tax. So, presumably with 9 extra stores there’ll be more profit and more Tesco Tax.

 

And all the suppliers that will lose out? Including IT firms and lawyers over and above the obvious food suppliers?

Manx Radio, 3FM, IOM newspapers, vehicle suppliers etc etc.  they all pay back into government coffers.

[A fool and his money.....]

4 hours ago, woolley said:

As I've said many times, the overwhelming majority of items in Tesco are the same price to the penny as in the UK, including staple items and fresh produce. Even down to Aldi price matching despite not having an Aldi. As we frequent UK and IOM Tesco on a regular basis, we'll be watching to see if this changes now that they have more stores here.

Not that Tesco UK prices are particularly cheap. The perception that they are has more to do with marketing than reality.

Also, now they have less competition and a much greater presence here, I'd be surprised if we don't see things change for the worse in that respect - at the very least staff wages will suffer.

[John Wright]

5 minutes ago, CrazyDave said:

And all the suppliers that will lose out? Including IT firms and lawyers over and above the obvious food suppliers?

Manx Radio, 3FM, IOM newspapers, vehicle suppliers etc etc.  they all pay back into government coffers.

Depends on how much Tesco source and advertise. Also, assuming they pay UK National rates rather than Shoprite rates of pay how much more ITIP and NI they will pay and how much less EPA the tax payer will have to shell out.

Profits from rent aren’t 0-10, so assuming leasing by Shoprite to Tesco there’ll be tax at 20% on the rent, and VAT chargeable if election is made.

The amount of Manx meat Tesco are selling is substantial. Possibly the largest retailer of Manx meat on Island. And they sell it cheaper than Shoprite, or Tesco own brand. Better quality.