Factors to include in the profit equation

How is the Great British manufacturing process and retail industry failing?

As a race are accountants and leaders of industry deluding us or are they missing the plot? Whilst they are mesmerised by playing with figures are they to blame for our failing industries and contributing to the demise of our trade in the High Street? In the last couple of years we all appear to have been affected in some way with the increasing need to make profit.

A couple of years ago I worked for a British manufacturing company that was bought out by an American company. Manufacturing was shifted out East at the expense of people’s jobs and quality of the product - had this been put into the Director’s accountant led equation to make profit?

In Poland the cost of buying the product back for sale in the UK became more expensive, with most of the UK skilled work force having been made redundant, machines etc, having been sold off and with the increased logistical costs of transporting the goods back to the UK via Holland meant it would be more cost-effective to then move manufacture to China.

Subsequent unapproved changes in product manufacturing caused product failures and then, due to shifting priorities by the manufacturer, the product became unavailable with excuses that there was a lack of steel, the cargo ship was being held up with Customs or bad weather etc. None of this had been put into the accountant led equation for increasing profit - as a consequence we no longer see the product for sale in the UK.

This again is real - honest - experienced shopping in Halifax at the weekend. Wanting a filing tray for an office I decided to go to a local national outlet store to purchase the product.

When I told the sales assistant that the product (£15) could be purchased from their website for £5 less they said they would check this out on their personal phone as it was quicker than trying to use the company’s internet connection. On confirming the price the assistant called across to their manager, “yet another price difference boss!”.

Their company policy means they obligated to sell at the price offered on the internet?

Then moving on to another large local electrical retailer I came across a similar situation when enquiring about purchasing a television but this time making a saving of £79.

Although I found these situations amusing it did make me wonder why, when the stores are complaining about loss of profits, they charge the consumer so much to shop on the High Street?

This shopping trip was becoming so much fun. Attracted to a clothes shop advertising ‘Massive 70% off sales bargains’ I ventured in.

Instead of being met by, “Can I help you?” or “Can I be of assistance?” I found the sales assistant on an in-depth telephone conversation with a colleague from another branch explaining that they were going to have to take a ‘sicky’ on Monday as their manager was calling and their sales figures were diabolical.

Would it be harsh to suggest that these tertiary factors might not have been included in the these companies bosses plant to make a profit?

Have any of your readers experienced any other manufacturing/retail pricing faux pas?

Jan Ashford