Retail news round-up on April 01, 2016: Tesco eyes sale of Giraffe chain and National Living Wage comes into force.
Tesco mulls disposal of Giraffe restaurant chain
Tesco is looking to offload its loss-making restaurant chain Giraffe as part of its turnaround plans.
A raft of private equity companies and other potential bidders are being quietly sounded out about their interest in acquiring Giraffe, according to Sky News.
The grocer bought Giraffe at just £50m, and any disposal would generate proceeds representing a mere rounding error in the context of the company's balance sheet.
Staff to get pay increase as national living wage takes effect today
The government’s compulsory national living wage (NLW) is set to hand 300,000 UK workers a pay rise that takes effect from today.
The retail sector will have to find up to £3bn more a year to pay staff by 2020 assuming it maintains differentials between entry and mid-level staff and spreads the NLW rate to all employees, not just the over-25s they are legally obliged to cover, according to the British Retail Consortium.
James Lowman, chief executive of the Association of Convenience Stores, said: “The introduction of the national living wage will have a devastating impact on many of the 51,000 convenience stores in our sector.
“Over 60% of stores in the sector will look to reduce the number of staff hours in their business and delay investment plans, while for some already operating on the edge of profitability it will mean that they will have to either stop employing staff or close their business altogether.”