The news that Tesco is to ditch chief executive Philip Clarke and replace him with a turnaround specialist from Unilever will have sent shivers down the spines of Morrisons’ current and former CEOs.
Dalton Philips, the current chief executive of Bradford-based Morrisons, and his predecessor Marc Bolland, who now heads up Marks & Spencer, are now seen as the frontrunners for the next supermarket cull given their firms’ disappointing performances.
Sainsbury’s is riding high after chief executive Justin King stepped down to be replaced by trusted insider Mike Coupe and it appears that Leeds-based Asda can do no wrong under Andy Clarke, who introduced every day low pricing years before its rivals got in on the act.
It appears that the final straw came for Mr Clarke when Tesco reported yet another profits warning on Monday and chairman Richard Broadbent said it was time to hand over to a new leader “with fresh perspectives and a new profile”.
According to research by Kantar Worldpanel, Tesco’s market share dropped to 28.9 per cent in June from 30.7 per cent when Mr Clarke took over in March 2011.
During the same period, discounter Aldi grew to 4.7 per cent from 2.1 per cent and its German peer Lidl rose to 3.6 per cent from 2.5 per cent, while Sainsbury’s and Asda – Tesco’s main rivals – remained largely stable.
Morrisons’ half year will end on August 8 and the company is due to announce its interim results on September 11 – not the most auspicious date as the 13th anniversary of the terrorist attack on the Twin Towers in New York is marked.
Morrisons needs to show marked signs of improvement if Mr Philips is to stay in place.
The investors who took out short positions on Provident Financial’s stock must be gutted following the Bradford-based lender’s latest results.
Many wrongly believed the doorstep to credit card lender would get hammered by the economic slump as its low paid customers reneged on their debts.
But Provident, under canny leader Peter Crook, has proved itself smarter than the punters. The firm has ditched 25 per cent of its customers, jettisoning those who weren’t paying back their debts.
At the same time its Vanquis credit card operation is going from strength to strength.
Vanquis’ customers tend to be people with ‘thin’ credit history which means the high street banks have turned them down.
As a reader of The Yorkshire Post it’s fairly unlikely that you have no plastic in your wallet, but spare a thought for the seven to nine million people in the UK who have no access to it.
Without a credit or debit card they can’t access cheap online flights or shop online. It’s a massive percentage of the population that have been disenfranchised from the online revolution.
Yes, Vanquis is more expensive than the cards you probably have in your wallet, but it’s a way for shunned customers to get back on track and re-enter the prime market.
Provident claims that 80 per cent of its customers have seen an improvement in their credit rating.
While Vanquis is Provident’s jewel in the crown now, its Satsuma online lending business has the most potential as payday lenders are forced to rein in their exorbitant fees under new legislation.
Satsuma’s terms and conditions fall well within the new FCA guidelines so it won’t be affected by the price cap, which is set to cost the payday loan industry about £420m in lost revenues.
Analyst Gary Greenwood, at Shore Capital, said: “Satsuma is showing encouraging signs of demand and we remain convinced that it will prove to be a very successful and alternative to payday loans.”
All three of Provident’s businesses – Vanquis, Satsuma and doorstep lending – are performing well ahead of expectations. The shares have enjoyed a good run but look as though they could go higher.