Morning business news - May 17Friday 17 May 2013 10.28
ABERCROMBIE & FITCH BOSS FEATURES IN NEW RETAIL BOOK - Mike Jeffries - the boss of clothing brands Abercrombie & Fitch and Hollister - has been accused of discriminating against the overweight by making clothes only for the thin. The company makes $5 billion a year in sales by deliberately leaving out a significant part of the shopping population. It does not make women's trousers above a size ten or tops above large (US sizes). While it does have XXL sizes for men, this is to appeal to muscular football players and wrestlers.
Robin Lewis is the author of The New Rules of Retail and says this is all part of Mike Jeffries masterplan to cultivate ''cool''. In an interview for this book, Mike Jeffries said he did not want larger people shopping in his store, he wants thin and beautiful people. Mr Lewis says that Jeffries is a brilliant visionary, who has really crystallised the core consumer he is going after.
MOOMINDER WINS KEY RURAL BUSINESS AWARD - Moominder - a company that makes an ear tag that measures a cow's temperature - has won the overall prize at the 2013 JFC Innovation Awards for Rural Business. Those awards are run with Teagasc, the Irish Farmers Journal and the Department of Agriculture in Northern Ireland. An ear tag with a sensor is attached to each cow's ear measures her temperature. A cow's temperature drops before she calves, which triggers a text notification to the farmer. The Moominder system was developed by farmer and software engineer Albert Moylan from Tubber in North Clare.
Albert Moylan says that the product is aimed at the smaller farmer and each tag costs €45 and a life span of ten years. The product's base station costs €650, but is also made for a long life. He says that the Moominder is targeting the agriculture sector now, but could eventually be used for humans many years down the line. He also says that he faced very stiff - and exciting - competition at the awards, including new types of windmills and aerators.
MORNING BRIEFS - Computer maker Dell reported results overnight and it said that in the three months to May it saw a 79% drop in net profit. The company said it saw a massive fall in personal computers sales as more consumers move to smartphones and tablets. Dell's net profit fell to $130m in the three months and revenue was down 2% to $14 billion. The company, which is in the middle of a dispute between founder Michael Dell and two of its biggest shareholders, said that revenue from new technologies, services and software, rose 12% to $5.5 billion. That was in contrast to PC sales, which fell 9%. Michael Dell wants to take the company private, but some investors are against that plan. He and private equity group Silver Lake have offered to buy back the company for $24.4 billion, and have said they would shift the business away from PCs to mobile devices. But its biggest shareholders - the investor Carl Icahn and Southeastern Asset Management - say that valuation is too low. They have proposed to offer additional shares to shareholders and install mew management.
*** Sina Corp, which runs China's biggest micro-blogging service, saw losses narrow in the first three months of the year as revenues rose. Sina has amassed more than 500 million users on its popular weibo micro-blogging site. The company said it continues to see strong growth in user numbers even though the Chinese government has tightened restrictions on comments made on blogs in recent months.
*** After the Google boss's performance at the House of Commons yesterday Amazon now face whistleblower's claims over UK business tax practices. Margaret Hodge, chair of the Public Accounts Committee, has signalled that there is a company interview to come on tax its arrangements. Amazon is facing mounting questions over the extent of the business activities conducted out of Patriot Court, its headquarters in Slough, threatening to throw the group's controversial UK tax structure into disarray. A spokesman for Amazon declined to comment on these allegations, reiterating: "Amazon pays all applicable taxes in every jurisdiction that it operates within." A tax lawyer described Amazon as "the Manchester United of the tax world" for the success of its tax structuring.