Waterstones boss defends authorities’s enterprise charges shake-up

[ad_1] The boss of Waterstones has defended the federal government’s strategy to the excessive road, arguing that controversial adjustments to enterprise charges have been “wise” and had benefited retailers in struggling areas.

James Daunt mentioned the bookseller’s whole enterprise charges invoice for this 12 months was going to be much like final 12 months’s as huge will increase at massive, profitable websites equivalent to its flagship on London’s Piccadilly had been offset by “fairly important” decreases at outlets in additional troubled places.

He mentioned he believed “our essential benefit is that we'll get neighbours again once more” in locations equivalent to Newport in Wales, Grimsby in Lincolnshire and Barrow-in-Furness in Cumbria, as retailers would possibly now take into account reopening amid decrease enterprise charges.

The chancellor, Rachel Reeves, has confronted a backlash over the looming tax adjustments from leisure companies, significantly pubs, which had confronted a 76% rise on common over the following three years. She has now promised a assist bundle to mitigate the influence that would come as early as Tuesday, however confirmed at Davos final week that the assist would solely be for pubs and never the broader hospitality sector.

The boss of Waterstones, which has 316 bookshops within the UK, together with Foyles, Blackwells in addition to its essential chain and Barnes & Noble within the US, was additionally relaxed in regards to the increased authorized minimal wage and much-criticised will increase to employers’ nationwide insurance coverage contributions that got here in final April.

Daunt mentioned Waterstones had seen additional prices consequently however “from our perspective nothing we're being requested to do are issues that don’t really feel manageable and affordable”.

“I've been complaining lengthy and laborious all by the Conservative years about authorities failing to assist the excessive road and significantly much less prosperous excessive streets the place [we paid] completely disproportionate enterprise charges,” he mentioned, arguing that the Labour authorities was now “making an attempt to do wise issues” to assist.

Daunt’s argument that charges are good for small retailers runs counter to feedback from the commerce physique representing hundreds of unbiased bookshops. After the price range, Meryl Halls, managing director of the Booksellers Affiliation, mentioned: “The Booksellers Affiliation has been clear from the outset that the federal government’s enterprise charges reforms threat being deeply damaging, significantly for small and medium-sized bookshops.”

She mentioned {that a} latest survey of members discovered 85% have been much less prone to spend money on inventory, staffing, occasions or their premises “as a direct results of the Westminster price range’s enterprise charges adjustments”.

Many UK retailers have complained of upper tax payments after adjustments within the 2024 price range. Daunt mentioned Waterstones had not been badly affected by will increase in employers’ nationwide insurance coverage final 12 months because it didn't usually make use of individuals on short-hour contracts, which have been most affected by the adjustments.

He mentioned he was not involved about new rights for employees resulting from are available from April underneath the Employment Rights Act as “we're already effectively forward of that”.

Daunt’s feedback got here as accounts printed at Firms Home revealed gross sales at Waterstones’ UK buying and selling arm rose 7% to £565.6m within the 12 months to three Could 2025. Pre-tax income fell again by about £3m to £40m, largely because of a £2.6m one off price associated to a cyber-attack on its provider, Blue Yonder.

The corporate paid out practically £34m in dividends to its personal fairness proprietor Elliott Funding Administration – £5m in August 2024, £23.8m in Could 2025 and an extra £5m in June 2025. That comes after Elliott reportedly employed advisers for a public itemizing of the bookseller, both in London or the US.

Daunt mentioned he was “very relaxed” a couple of potential IPO because it appeared “extremely possible” that Elliott would promote the enterprise “sooner or later”, including: “That’s what personal fairness do.” He mentioned Elliott had “purchased us for not very a lot and we've turned the US enterprise round fairly dramatically”.

He mentioned the corporate, which is planning to open 10 shops a 12 months within the UK, continued to commerce effectively by Christmas final 12 months and into January as e book followers have been being impressed by sharing on social media together with TikTok.

“Bookselling is having fun with a pleasant time. We had a very good Christmas and January. It's not simply us, independents are additionally doing effectively. It has been excellent for the reason that pandemic.

“Clearly individuals who purchase books are shopping for an terrible lot extra of them.”

He mentioned traits in studying have been altering, typically led by social media, in order that bestsellers might be fairly uncommon. He singled out Mona’s Eyes, a translation of a French novel by Thomas Schlesser, which took off over Christmas within the US.