This is an audio version of Financial Times news service Podcast episode:Dollar stores in America are getting a makeover«
Philippine brand
Good morning from the Financial Times. Today is Monday April 24th and this is the Financial Times news feed.
[MUSIC PLAYING]
The biggest bank in Spain is trying to steal the best bankers from Credit Suisse. Rishi Sunak has to calm nerves on multiple fronts. And British therapists have mixed feelings about expanding into a big US online therapy company. Plus, dollar stores are adjusting to an era where things cost a lot more than a dollar. I’m Mark Filippino and this is the news you need to start your day.
[MUSIC PLAYING]
Swiss banking giant UBS is merging rival Credit Suisse. And this difficult merger process is an opportunity for other banks to hunt down the Credit Suisse banker. FT sources say Spain’s biggest bank Santander has been in talks with Credit Suisse veteran David Hermer. Hermer is currently head of equity and capital markets, and has been at Credit Suisse since 1994. Santander wants to hire dealers and junior staff to try to boost its investment banking presence in the EU and US, the sources said.
[MUSIC PLAYING]
Today British Prime Minister Rishi Sunak will try to restore British business. He is holding his first summits with business leaders and is part of the Conservative Party’s efforts to repair the damage caused by Brexit and fend off Labor’s efforts to brand itself as more business-friendly. Sunak is also about damage control on the political front. His deputy, Dominic Raab, tendered her resignation on Friday. An independent report confirmed allegations that Raab had intimidated public officials. Raab denied the accusations. This is the latest headache for a prime minister who promised transparency, accountability and integrity when he took office last fall, says George Parker of the Financial Times.
Jorge Parker
For this reason, there were some surprises when he appointed his first cabinet, which included three ministers about whom several complaints were made at the time. After that, the former foreign minister, Nadim Al-Zahawi, was forced to resign from the government due to problems related to his fiscal affairs. Gavin Williamson, another cabinet minister, was forced to resign over allegations of bullying. And now the deputy prime minister has to resign again after this independent investigation backed up the bullying allegations. So it’s not looking very good for Rishi Sunak’s trial. I think most people would say that Rishi Sunak is determined to lead a government that is very different in character from the lawless one led by Boris Johnson. And, to be fair to Rishi Sunak, the allegations have led to the dismissal or resignation of ministers. But however, you know, it’s a reminder of the big picture this government can have, it’s lost its way after almost 13 years in power.
Philippine brand
Yes. So, George, what did Snake do to right the ship right now and calm things down? And what does this mean for the upcoming UK general election next year?
Jorge Parker
Well, he quickly moved to replace Dominic Raab as deputy prime minister, and someone like Oliver Dowden, who has a somewhat dry technocratic personality, became deputy prime minister. Look, I mean, I think in the end the election will be judged on whether Rishi Sunak does any work to repair the damage the British economy has suffered as a result of Covid, Brexit and the war in Ukraine. And those are the things that ultimately decide how people vote. But I think he’s aligned with that, he needs to get over this very quickly because the one thing voters don’t want to see is a prime minister whose time is spent reading reports of ministers bullying officials instead of doing their day job. Trying to fix Britain’s strained economy and public services.
Philippine brand
George Parker is the political editor of the Financial Times.
[MUSIC PLAYING]
Wherever you go in the United States, you will find a dollar store. It has long been the preferred choice of low-income Americans looking for cheap dry goods, toiletries, and stationery. Recently, however, inflation has pushed more middle-income consumers into its stores. The FT’s Alexandra White reports that two large chains, Dollar General and Dollar Tree, have invested heavily in installing freezers and refrigerators.
alexandra white
Food costs much more than a year ago. More and more people are turning to these places for food as they have slowly expanded into the supermarket plaza. Dollar General last year offered products in about 3,000 stores and this year they’re going to push that to sell products in 8,000 of their stores. So they’re really looking for ways to appeal to consumers and maybe a different type of consumer, a middle-income consumer who doesn’t necessarily think about shopping at a dollar store. But when they have all these needs there, which is what consumers are spending now, that’s where they’re going to gravitate.
Philippine brand
So basically, it looks like more middle-income consumers should be on the lookout for good deals. And if they see that they can buy necessities like food at a dollar store, they will go there.
alexandra white
Yes Yes. So dollar stores are not necessarily trying to become grocery stores because grocery stores have a lower profit margin. But they want to expand into food because they use it to attract people. And their hope is that they can get people to spend money on groceries, on food, but also spend money on some of their discretionary items, like household items, like clothing, that have a higher markup.
Philippine brand
So those two big chains, Dollar Tree and Dollar General, are increasing their capital spending, so they’re investing in their own stores. Now if you look at Walmart, the other big retailer, capex is flat. Alexandra, why do dollar stores spend so much more to improve their stores?
alexandra white
They are making these necessary investments because they are growing and because it is a unique business model. I mean, Walmart can also find customers online, or people are more likely to travel long distances to go to Walmart. But Dollar General and Dollar Tree are built around convenience. So they have to make sure they have a big footprint. And now I think they have to redesign the stores to fit with the company’s strategy.
Philippine brand
This is Alexandra White from FT.
[MUSIC PLAYING]
In the US, online therapy has taken off, especially since the pandemic and all the demand for virtual mental health support during the pandemic. One of the biggest sites is betterhelp.com. It is owned by a $4 billion publicly traded company called Teladoc Health, which is now bringing BetterHelp to the UK. But therapists have mixed feelings about the site. For more, join me with Ian Johnston of the Financial Times. Hello Ian.
Ian Johnston
Hola.
Philippine brand
So Ian, as you mentioned, BetterHelp has recruited around a thousand therapists in the UK. What is the appeal?
Ian Johnston
I think it’s a very different way of working. They have more flexibility. They can choose their hours. It also draws people in with very large rewards. Some people I spoke to were offered $1,000 sign-up bonuses and then told they could earn up to $100,000 a year. But this was not the case for many of them.
Philippine brand
Yes. So, that’s one of the big concerns I heard when you were reporting. Why have many therapists in the UK been unable to earn this level of income?
Ian Johnston
Obviously £100,000 per year will work up to 40+ hours on the platform. And being able to do that means you’ll see 30-40 clients a week every week of the year without interruption. This is very difficult for therapists, either you are on the brink of burnout and just presenting an unrealistic model for the people they are recruiting. Then, on the other side of the coin, in fact, clients may end up seeing burned-out therapists, who just don’t fit in. There is a feeling that this could lead to lower quality care and a situation where you as a client are not able to see the people who are equipped or supported to meet your needs.
Philippine brand
Are there other concerns besides working conditions and wages?
Ian Johnston
Some other concerns relate to how BetterHelp is sold. BetterHelp tells people that all therapists are licensed and certified. This has not been the case with therapists in the UK because licensed therapists do not exist in the UK. We don’t have the same system as the United States. Obviously, the problem with that is that BetterHelp offers something that isn’t quite in line with the service it advertises. The other thing they are concerned about is customer safety. There are no support staff for these therapists in the UK. They have to wait until the US support team wakes up to contact them. There is also no real way for them to communicate with their customers other than through the platform. They have to communicate, and they have to have an emergency contact number. So there’s also this kind of concern for customer safety.
Philippine brand
What does BetterHelp say about this? Did they respond at all?
Ian Johnston
BetterHelp said it has a rigorous hiring process and that for those who need support and therapists who need support, they have an online community forum with other veteran therapists offering advice and education. They said they responded to people within 48 hours and would provide the client’s contact details to therapists in case of an emergency.
Philippine brand
Yes. So, Ian, what’s your take on all these reports?
Ian Johnston
I think that is the case with this company that is growing exceptionally fast and that provides a model for the gig economy for an industry that deals with vulnerable people. And it seems, from the therapists I’ve spoken to, that there is a priority on growth over quality of care. Also, with this expansion into the UK, as seen in the licensing situation, there really wasn’t that understanding of the UK market.
Philippine brand
Ian Johnston is a technology reporter for the Financial Times. Thank you, Ian.
Ian Johnston
gracias.
[MUSIC PLAYING]
Philippine brand
You can read more about all these stories on FT.com. This was your daily news source from the Financial Times. Be sure to check back tomorrow for the latest business news.
[MUSIC PLAYING]
2023-04-24 04:32:05
#Dollar #stores #America #makeover
