The boss of the clothing chain Superdry says its rival Shein is being allowed to “dodge tax”, and is urging the government to take action.
Julian Dunkerton told the BBC the fast fashion giant was enjoying an unfair advantage because import duties are not charged on the low-value parcels it sends direct to customers from overseas.
Shein declined to comment, but has previously said that its success was due to its “efficient supply chain”, not tax exemptions.
The Treasury said tax policies had to balance the interests of consumers and retailers.
However, Mr Dunkerton said it would be in the UK’s interests to get rid of this tax “loophole”.
Advertisement
“The rules weren’t made for a company sending individual parcels [and] having a billion-pound turnover in the UK without paying any tax,” said Mr Dunkerton, founder and chief executive of Superdry.
“We’re allowing somebody to come in and be a tax avoider, essentially.”
Shipments worth less than £135 that are sent directly to UK shoppers do not face import duties, but firms bringing in larger consignments do.
Before the arrival of a globalised online marketplace the exemption had limited impact, but retailers in the US and EU are now increasingly being undercut by low-cost Chinese rivals, and state treasuries are missing out on potential tax take.
Advertisement
Mr Dunkerton also described Shein as a “complete environmental disaster”.
“Personally, I would force them into paying import duty, VAT and possibly even an environmental tax,” he told the Today Programme on Radio 4.
Shein has previously said it complies fully with all its UK tax liabilities.
The company, which was founded in China but has relocated to Singapore, has been laying the groundwork for a potential sale of shares on the stock market, prompting closer scrutiny of its practices.
Advertisement
The BBC understands that the firm filed initial documents for a London listing earlier this year, after a potential New York listing came under fire from both Republican and Democrat politicians.
US lawmakers were concerned over the company’s “deep ties to the People’s Republic of China”. It has also been accused of using forced labour in parts of its supply chains, which it denies. It told the BBC it has a “zero tolerance for forced labour”.
Shein says its “test and repeat” approach, producing items in small batches and then reordering according to customer demand, means there is less waste, compared to traditional retailers.
But it has been criticised for encouraging shoppers to buy items to wear once and discard, through its low prices and “gamified” social media strategy.
Advertisement
The US and the EU are already looking at whether to tighten tax policies to bring Shein and other direct-to-consumer businesses, like Chinese retailer Temu, into the net.
Shein has previously argued its success was not down to tax exemptions but was due to providing customers with affordable fashion.
An HM Treasury spokesperson said: “Our customs and tax regime balances reducing burdens for businesses and consumers buying lower-value goods from overseas with the interests of UK businesses.”
VAT – value added tax – was charged at the same rate on all goods irrespective of their origin or value, they added.
Advertisement
Mr Dunkerton founded Superdry more than 20 years ago.
Its distinctive Japanese-style t-shirts were once worn by Hollywood actors and sports stars and, at the peak of its value in 2018, the company was worth £1.8bn.
But Superdry’s popularity has declined, and in July it de-listed from the London Stock Exchange after nearly 15 years.
Its shares now trade on an alternative exchange and the company is valued at less than £10m. Mr Dunkerton says he is still working to turn the firm’s fortunes around, and he confirmed he would try again to take the company private.
Forbes SVP of global sales Kyle Vinansky, Insurads CMO Nuno Brilha, Telegraph senior director of digital solutions Gareth Cross and Newsquest digital transformation director Morgan Stevenson. Picture: ASV Photography Ltd for Press Gazette
Although the tech giant’s about-face caused grumbles in the news industry, executives at Press Gazette’s Future of Media Technology Conference agreed the threatened death of cookies on Google‘s dominant Chrome browser provided the impetus necessary to get their houses in order on user data.
That change, they added, appears to already be reflected in increased ad sales.
‘I definitely used the word bastards’ when Google made cookie announcement, says one executive
Asked by Press Gazette editor-in-chief Dominic Ponsford how he had reacted to Google’s July cookie announcement Morgan Stevenson, the digital transformation director at Newsquest, said: “I definitely used the word bastards.
“Simply because we put a lot of work in, preparing. I think it was a good industry kick up the arse to better prepare for leveraging our first-party data.”
Advertisement
Thanks for subscribing.
But he said he felt Google had at least been “trying to create a solution to the challenge, unlike Safari and Mozilla, who just said ‘see you later, publishers’…
Content from our partners
Advertisement
“I think there was a part [of me that] would have liked to just carry on with it, pull the plug, let’s see what happens. But there is so much still within the consent challenge to truly be confident that, if they pull the plug, we know what’s going to happen.”
Cookies are packets of data that give websites information about their users. If a website knows about its users it can sell ad space for higher prices, so Google’s planned deprecation of third-party cookies left publishers scrambling to develop strategies to get users to hand over their data directly.
Ultimately, Stevenson said, “it was a bit of reprieve, actually, just to get a bit more time with so many challenges to be ready for it if they really do pull the plug”.
Kyle Vinansky, the senior vice president of global sales at Forbes, had a similar view, saying: “I think everyone on our team really groaned when we heard that news. It was just one more thing in that saga.
Advertisement
“But I think what Google did, and others that were focused on this cookieless future, is they really got us thinking more about our first-party solutions, about the way that we could better understand our audiences…
“The biggest thing for us is it put focus on an issue where, ten years ago, despite our size and our scale, we didn’t know that much about our audiences. Now we know an awful lot.
“We’ve been investing more, even outside of first party data, and looking at ways with research panels and other levels of engagement that really allow us to dive into those groups that are most core to the advertising partners that are spending with us.”
Gareth Cross, the senior director for digital solutions at The Telegraph, said he had been less shocked: “To say it wasn’t the biggest surprise of the year is probably an understatement.
Newsquest sees success with subscription model for advertisers
Despite their frustrations, the publishers said things appeared to be going in the right direction on ad sales.
Stevenson said Newsquest had “done very well pushing our direct sales with lots of local businesses. That’s predominantly what the Newsquest model focuses on”.
Although most of its concern was with its digital direct-sold advertising, he said “we’ve done significantly better this year at holding on to print revenues.
Advertisement
“One of the diversifications that we did six to seven years ago was to start introducing digital marketing services, as a reseller of those, to the same businesses that we sell our direct audiences to. That’s helped us become much stickier, for customers to stay with us.”
Services offered within that package included “SEO advice, PR copywriting, website building as well – so a whole one-stop shop and helping them to really navigate how they better improve the marketing of their own brand”.
He said Newsquest had “invested very heavily” in metrics like view time that help prove the value of their services to small business owners, and that they have improved client retention by rolling out a subscription model for ad sales.
“We looked at the best-performing campaigns for different industry styles and turned them into such good value you can’t afford to turn them off,” he said.
Advertisement
“You need to give three months’ notice if you want to turn it off, effectively… I’d say probably now 16 or 17% of our ad revenue is coming from a subscription model for advertisers.”
Telegraph: Direct-sold advertising revenues up and ‘they will grow again this year’
Cross, from The Telegraph, said that over the last year “we have seen our areas of focus, our direct-sold, grow. We’ve seen our partnerships grow, and digital revenues, from an advertising perspective, are up. And they will grow again this year”.
He said the “beauty” of a subscription-first business was that “the things that come with that are all the things that help you face some other challenges” around advertising.
Advertisement
“So there’s a hell of a lot of first-party data – whether it’s declared, inferred – and the way we use it, we no longer need to rely on third-party data sources for our direct-sold.”
More broadly, he said, “we do things now that we would never have done before. A good example of that is if an ad format isn’t working, we remove it.
“Often what would have happened in the past – you [wouldn’t] lose that yield, you’d just add something else, and before you know it you’ve got something incredibly cluttered, diluted…
“One of my colleagues says the ad experiences are designed to engage, not enrage.”
Advertisement
Forbes executive Vinansky also said he was pleased with the year – but sounded a note of caution.
“From an audience standpoint, I think we’re doing better than ever: almost 100 million users on a monthly basis, consistent growth from that regard,” he said.
“From a revenue standpoint we’re pacing ahead of last year, but Q4 for us is an incredibly important time of the year. We’re expecting a lot of information in the next month or so that’s really going to decide where those numbers fall on an annual basis.
“And we’re still up against a very challenging political landscape, as we all know. There’s a lot of economic uncertainty still, and it’s a question for us of whether or not our largest advertising partners are in a position where they want to be a part of those conversations, or they want to wait and they want to stay out of the market.”
Advertisement
Forbes has a partial paywall, but Vinansky said “the majority of our traffic” does not come through it.
“We continue to grow our registered users, but we view that as multifaceted – it’s people that attend our events, it’s people that subscribe to our newsletters, it’s people that subscribe for digital or print access.”
He said that direct-sold advertising is “our largest business segment”, with ads sold via the open exchange second.
Forbes SVP of global sales responds to revelation the site had been running ads on a low-visibility subdomain
Press Gazette editor Ponsford also asked Vinansky about a story that broke in March which revealed that some ads Forbes had been paid to run had appeared not on the main site but on a subdomain that could not be accessed through regular site or search engine navigation. (Forbes has denied that it had been running a so-called “Made for Advertising” or “Made for Arbitrage” site.)
Advertisement
“I think it’s really caused us to think about transparency in a different way,” Vinansky said.
“From a data compliance standpoint, and some of the verification partners that they were using, we taught our partners how to actually identify any advertising that ran with us on that subdomain. It just wasn’t something that they were looking for.
“The primary issue that we were dealing with there… was a matter of the page templates that we were using, and them being gallery-style templates.” (The ads on the subdomain appeared while a user clicked through slideshow-format content.)
He continued: “Once we had that conversation with our partners about why these pages existed, the way that we were using them, the way that they supported some of our most deeply-reported editorial, it had a very different outcome than the article alone that really put us in a spotlight and had us on our heels in a pretty negative way.”
Advertisement
A specific change following the incident, he said, was that Forbes now provides “a templated lookbook of every single page design that we use on Forbes and every single place that an ad could theoretically run.
“It was nothing that we had done before. We’ve provided screenshots before after a campaign went live, but now we’re getting to granular detail as to where your ads might run before a campaign happens.
“From a reporting standpoint, we are dialed into all of the ad verification partners and have direct relationships with them ourselves. So we encourage our partners to use that data. We encourage them to use our first-party data. We encourage them to use third-party data segments that are outside of those.
“It’s the mixed approach to making sure that everyone feels the highest levels of confidence in that reporting and where the sources are coming from and being able to tell a more complete story with it.”
Advertisement
Email pged@pressgazette.co.uk to point out mistakes, provide story tips or send in a letter for publication on our “Letters Page” blog
Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
AkzoNobel will cut about 2,000 jobs as the owner of Dulux comes under pressure to slash costs and keep up with competitors.
The Dutch paint producer said on Tuesday that it planned to make the cuts, equivalent to more than 5 per cent of its workforce as of this summer, by the end of 2025.
Advertisement
AkzoNobel reported a total workforce of 35,700 in June.
The group last year revealed it had been forced to slash jobs and production in Europe, intensifying concerns about the resilience of European industry as the continent struggled with rising energy costs following Russia’s full-scale invasion of Ukraine.
Despite inflation recently easing for peers across the continent, where manufacturers were hit particularly hard by cuts to Russian gas supplies, AkzoNobel warned that it continued to struggle with high costs.
Amsterdam-traded shares in AkzoNobel rose 1 per cent in morning trading, having declined 14 per cent over the past year.
Advertisement
The group, one of the world’s largest paint producers, did not comment on where its latest round of job cuts would be made. But internal communications seen by the Financial Times said the company’s issue included a disproportionately large number of managers as well as high marketing, administrative and research costs compared with similar businesses.
Chief executive Greg Poux-Guillaume said the move would help the business “become more agile in volatile markets and offset headwinds such as rising labour costs”.
AkzoNobel was aiming “to accelerate profitable growth by optimising our functional organisation to become more agile”, he added.
Despite the concerns over profitability, AkzoNobel’s earnings have risen in recent months, with the group reporting that first-half profits before tax rose 27 per cent against a year earlier to €496mn.
Advertisement
The company has said it expects to report adjusted earnings of at least €1.5bn for the full year, an increase over the €1.4bn reported last year.
The job cuts follow a rise in the group’s workforce from 32,800 to 35,700 over the past three years.
They are also being made despite costs falling generally across the Eurozone, where inflation slowed in August to a three-year low of 2.2 per cent. This prompted a quarter percentage point rate cut this month by the European Central Bank, which said labour costs remained high but were “moderating”.
AkzoNobel generates almost half of its revenues in Europe, the Middle East and Africa. The group warned in July that operating cost inflation, particularly in wages, was continuing to weigh on its profitability.
Transact has become the first intermediary platform to adopt an electronic Cash Isa transfer service via Pay.UK (BACS) and Equisoft.
This simplifies the transfer process by enabling seamless information exchanges between Transact, banks and building societies, removing the need for paper-based transfers.
Previously, transferring a Cash Isa required sending paper instructions to banks, locating processing teams and manually completing the steps.
With this new service, clients no longer need to wait for cheques, and funds can settle in their accounts faster. The system ensures secure, reliable transfers, adhering to best practices and industry regulations.
Advertisement
Seventy-two leading banks and building societies are now using the service, which automates Cash Isa transfers, including Junior Isas. This is expected to significantly reduce transfer times across the industry.
For example, Transact’s cash/electronic transfers now take an average of nine days, compared to 42 days for manual or in specie transfers.
Transact’s recent survey reveals that 90% of financial advisers support electronic messaging to speed up transfer times, urging regulators to encourage wider adoption by legacy providers.
The platform has seen year-on-year improvements in transfer services, including the creation of regional transfer specialists, the introduction of an online transfer tracker and enhancements to the online transfer application process.
Advertisement
Tom Dunbar, chief development officer at Transact, said: “We are obsessed with trying to improve transfers and this latest development links our commitment to improve transfer times with our digitalisation programme.
“We expect thousands of cash Isa transfers onto Transact to benefit from this new, faster service each year.
“We remain committed to personal service but where automation or integrations can speed up processes, we are keen to adopt new solutions.”
At least 30 decomposing bodies have been found on a boat off the coast of Senegal, military authorities say.
The navy was informed of a vessel that was adrift about 70km (45 miles) from the capital Dakar, according to a military statement on X. They brought the wooden canoe, or pirogue, into port on Monday morning.
“Recovery, identification and transfer operations are being made extremely delicate by the advanced state of decomposition of the bodies,” the statement said.
There has been a recent increase in migrants setting off from Senegal for Spain’s Canary Islands – a journey of more than 1,500km (950 miles) across the Atlantic Ocean.
Advertisement
Given how decomposed the bodies were, the migrants were probably adrift on the Atlantic Ocean for many days before fishermen found them.
Investigations are underway to determine when and where the boat departed, and how many people were on board, the army said.
“We must avoid this type of journey. It is a kind of suicide,” said Dakar boat owner Mandiaye Diène.
He told the BBC that swordfish fishermen, who go more than 60km off the coast, often come across floating bodies or boats with lifeless bodies drifting on the waters.
Advertisement
“It’s a sad fate. I certainly don’t support this form of emigration, but people are desperate,” said Bassirou Mbengue, a fisherman and boat owner.
Some Senegalese fishermen say they can’t survive by fishing any longer because of the presence of foreign trawlers off the coast, so they turn to either migration, or offering their boats to be used by people smugglers.
“It’s dangerous to travel by sea to Europe. I would never do it and neither would my children. But you can’t blame those who go. There are no fish left on our coasts and fishing equipment is expensive,” said Mr Mbengue, 50.
Senegal’s government announced a 10-year plan in August to tackle illegal migration amid a surge in migrant-related deaths.
The authorities have intercepted hundreds of migrants on boats off the country’s coast in recent weeks.
Despite frequent tragedies, unemployment, conflict and poverty drive young men to risk the route from West Africa to Spain’s Canary Islands.
Boubacar Sèye, President of Horizons sans Frontières, an NGO that raises awareness on the effects of illegal immigration, told the BBC that “given the recurrence of this type of tragedy, we can say that this is no longer a cyclical phenomenon, but rather a structural one”.
Advertisement
“To stop this, we need to attack the problem at source, with new ways of raising awareness in the most vulnerable areas”, says Mr Sèye.
For him, “despair is total”, for many people to the point where “the most vulnerable people think they have no future in the country”.
Young West African migrants have been increasingly using the Canary Islands route to reach Europe because it involves a single, albeit dangerous, journey rather than needing to cross both the Sahara Desert and the Mediterranean Sea.
Frontex, the European border agency, reported that in 2023 the Atlantic route saw a 161% increase compared to the previous year.
Advertisement
The UN says about 40,000 migrants made it to the Canary Islands last year.
Nearly 1,000 are known to have died or disappeared on the way. Although the real number is likely to be far higher.
Unlock the US Election Countdown newsletter for free
The stories that matter on money and politics in the race for the White House
The United Arab Emirates’ leader met US President Joe Biden in Washington on Monday to advance artificial intelligence co-operation as the Gulf nation tries to secure easier access to US-made technology.
The meeting comes during Sheikh Mohamed bin Zayed al-Nahyan’s first official trip to the US in seven years and underscores his determination to win White House support in his efforts to transform the UAE into an AI leader.
Advertisement
As well as discussing technology and trade, Biden said the UAE would now have “major defense partner” status along with India, to foster greater security ties through measures such as joint military training and exercises.
The UAE is one of the US’s most important allies in the Middle East, but relations have been strained at times in recent years. Talks for a formal security pact with Washington have stalled, and Abu Dhabi was infuriated by what it saw as a lukewarm US response to attacks on the UAE’s capital by Houthi rebels from Yemen in 2022.
Yet AI has brought new energy to the relationship. Oil-rich Abu Dhabi has made AI central to its plan to wean itself off fossil fuel exports and has taken a strategic decision to work with US companies producing cutting-edge technology.
“AI and new changes in cloud computing, etc, are going to change the way the world looks,” Anwar Gargash, Sheikh Mohamed’s diplomatic adviser, said in Dubai last week. “We cannot let this sort of wave of technological breakthroughs pass by us.
Advertisement
“If we believe that hydrocarbon is on the way out, slowly but surely, then we have to replace the revenue stream through something else,” he added.
However, the US last year added the Gulf states to a list of countries restricted from freely importing cutting-edge US-made AI chips over concerns about technology leaks to China. This means companies have to apply for licences to export the chips, and the process has held up some UAE companies’ AI plans.
The presidents instructed officials to develop a memorandum of understanding on AI co-operation, the next step in formalising the partnership. But they also sketched out several broad areas for collaboration, including supporting bilateral investment and “efficient licensing”.
One person briefed on the UAE’s plans said the Gulf state had wanted to sketch out a “road map” ahead of the upcoming US election “so that progress is locked in . . . whatever president assumes office in January”.
Advertisement
The person added officials were aiming to get the UAE’s export designation changed so it would be easier to get hold of chips.
Brad Smith, president of Microsoft, which invested $1.5bn in the UAE’s most important AI group G42 in April, told the Financial Times last week that clarity over the export controls was “emerging”, but it had “taken several months to work through”.
Smith added that export applications by Microsoft and other technology companies were not fully complete but were “getting very close”.
In a sign of the UAE’s drive to deepen relationships with US companies, G42 announced last week that it was working with Nvidia, the US company that makes chips critical for AI, on a weather forecasting initiative.
Advertisement
US companies looking to finance expensive AI projects have also welcomed Abu Dhabi’s petrodollars.
MGX, a new Abu Dhabi investment vehicle dedicated to AI, last week announced it was joining asset manager BlackRock, Global Infrastructure Partners and Microsoft to launch a $30bn fund to invest in data centres and the energy to power them.
Sheikh Tahnoon bin Zayed al-Nahyan, the UAE’s national security adviser and chair of G42, visited Washington in June and has spearheaded the UAE’s efforts to secure US backing for its AI ambitions.
Advertisement
The FT previously reported that OpenAI founder Sam Altman and Sheikh Tahnoon were in discussions to finance an ambitious chipmaking project.
Gargash said Sheikh Tahnoon had “a good understanding of tech”, suggesting this could help the UAE’s negotiations with US officials and executives. “When he sits with somebody like Altman or whatever, he’s really talking his language,” Gargash said.
Sheikh Tahnoon attended the meeting between Biden and Sheikh Mohamed.
Pensions technology provider iPipeline has reported a significant rise in demand for annuities among financial advisers.
In the first half of 2024, annuity quotes increased by 12% compared to the same period in 2023, marking the highest demand since iPipeline began tracking in 2013.
This follows a record 60% year-on-year rise in adviser annuity comparisons on its platform in 2023.
iPipeline’s annuities portal now accounts for 25% of all quotes in the UK retirement market.
Advertisement
The company’s November 2023 ‘Building a Better Retirement’ report, produced with Retirement Review, revealed that the average UK saver aged 40 to 66 targets a pension pot of £223,503, yet many fall short.
The average total value of personal pension pots is £167,891, with 23% of savers holding less than £50,000, and 37% having no savings target at all.
The findings highlight the growing importance of annuities in retirement planning.
Greg Neall, chartered financial planner at Wake up your Wealth, said: “This clearly shows a continued return to the annuity market by advisers, which comes as no surprise as annuity rates for those in their mid to late sixties are comparable to sustainable drawdown rates.
Advertisement
“If this higher interest rate environment persists, I believe the rates of annuity quotes will continue to increase particularly for those investors over 70 who have deferred taking their pension pots or have used a drawdown to transition towards a secure income later.”
Paul Yates, product strategy director at iPipeline, said: “We’ve seen advisers are searching for annuities during a time of higher interest rates. We assume, that now rates have started to fall and may continue to do so, these annuity numbers will start to slowly reduce.
It will be interesting to see what happens in the second half of the year (especially with the current market volatility levels). We are unlikely to see a return to interest rates under 1% again, so annuities should remain a key part of an adviser’s retirement toolkit, especially for older retirees who need income guarantees.
“We would also expect to see growth as the number of people with drawdown pots increases and as the age profile of holders grows.
Advertisement
“At the same time, we have a new government that could start to make major changes, and that may impact the way we save for, and spend in, retirement.”
You must be logged in to post a comment Login