Latest / What the Flux / H&M Australia's $35 million wage blow-out | Aussie EVs fail testing | Magnum splits from Unilever

Transcript

H&M Australia's $35 million wage blow-out | Aussie EVs fail testing | Magnum splits from Unilever · What the Flux

• 0:05
  Speaker 1: This is what the Flux. I'm Brett and Justin and
• 0:08
  Speaker 1: it's Friday, the fifth of December.
• 0:10
  Speaker 2: It's fair to say that the palms of one Australian small.
• 0:13
  Speaker 1: Retailer are very sweaty right now.
• 0:14
  Speaker 2: Get these lawyers for Eminem aka mister Slimshady are taking
• 0:17
  Speaker 2: an Australian beach brand to court. The company's name is
• 0:21
  Speaker 2: swim Shady, and Eminem's lawyers claim that the business name
• 0:24
  Speaker 2: deceives customers if they're thinking it's beach equipment is linked
• 0:27
  Speaker 2: to Eminem And personally, I'm just waiting for Eminem's next
• 0:31
  Speaker 2: disc track of this swimwear.
• 0:32
  Speaker 1: Brand, Eminem of the Beach. Can't quite put them together
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  Speaker 1: in my mind. Be Man, not at all. Another Friday
• 0:38
  Speaker 1: eight means another fifty bucks that we're giving away to
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  Speaker 1: one lucky member of the Flux community. All we've got
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  Speaker 1: to do is have the Flux app downloaded and your
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• 0:47
  Speaker 1: and finance questions correctly and first, you win the fifty
• 0:50
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• 0:55
  Speaker 1: six Today.
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  Speaker 2: Three delightful stories Today juzzy boy, let's do it for
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  Speaker 2: our first. X and M Australia is facing a thirty
• 1:01
  Speaker 2: five million dollar bill for unpaid wages to Australian staff
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  Speaker 2: as it starts to quietly shut down its underperforming stores.
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  Speaker 1: Okay, scissars our b man. H and M is taking
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  Speaker 1: a big fat trim, So tell me all so.
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  Speaker 2: H and M is the Swedish fast fashion giant that
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  Speaker 2: was founded back in nineteen forty seven and now has
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  Speaker 2: over four thousand stores in over seventy five countries.
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  Speaker 1: Launched in Australia back in twenty fourteen with ques around
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  Speaker 1: the block.
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  Speaker 2: I remember that it's first Melbostor had fifteen thousand people
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  Speaker 2: walk through on its opening day.
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  Speaker 1: But Beman. After years of being the hot new thing
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  Speaker 1: in fast fashion, H and M has seen its sales
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  Speaker 1: dip over the past year.
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  Speaker 2: Yep, sales drop four percent over the last year to
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  Speaker 2: three hundred and forty million bakkarunis.
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  Speaker 1: And now throw on top of that, H and M
• 1:39
  Speaker 1: Australia is under investigation by the Fair Work Onbardsmen. YEP.
• 1:43
  Speaker 2: The Omberdsman alleges that H and M underpaid up to
• 1:45
  Speaker 2: fifteen hundred staff a man, I.
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  Speaker 1: Do you think that's bad? But if it wasn't bad enough,
• 1:50
  Speaker 1: H and M is now rationalizing its stores too, down
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  Speaker 1: from fifty stores to just thirty four over the past
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  Speaker 1: couple of years. So what is the key learning here?
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  Speaker 2: Store footprint rationalization is a pretty fancy way of saying
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  Speaker 2: that a retailer is trimming locations to match demand.
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  Speaker 1: For years, be man. H and M expanded quickly across
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  Speaker 1: Australia because of its foot traffic and sales allowed them
• 2:09
  Speaker 1: to have that big physical presence, the juzzy boy.
• 2:12
  Speaker 2: As revenue soft ferns and cost climb, those same stores
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  Speaker 2: become expensive to operate.
• 2:17
  Speaker 1: Yeah. H and M cutting nearly a third of its
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  Speaker 1: Australian stores shows quite the strategic shift outseas the Australian
• 2:23
  Speaker 1: market fewer large format stores and potentially more focus on
• 2:26
  Speaker 1: e commerce and they man, it seems to be slowly
• 2:28
  Speaker 1: and slightly working well.
• 2:30
  Speaker 2: Last year, H and M Australia had a profit margin
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  Speaker 2: of negative one percent.
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  Speaker 1: This year it flipped a two point five percent thanks.
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  Speaker 2: So while it's not fireworks, any move up is a
• 2:40
  Speaker 2: win for H and M.
• 2:41
  Speaker 1: Right now, For our second story, Australia's top electric vehicles
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  Speaker 1: have all failed in real world testing, with some models
• 2:48
  Speaker 1: dravely up to thirty percent less than their advertised battery range.
• 2:52
  Speaker 2: No surprise that ev buys in Australia a little bit
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  Speaker 2: edgy about electric vehicles.
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  Speaker 1: Juzzyboy, So go on. So we know that electric vehicles
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  Speaker 1: really kicked off in Australia back in December twenty fourteen
• 3:02
  Speaker 1: when Tesla made a big song in a dance. Yeah.
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  Speaker 2: Since then, we've seen a whole host of electric vehicle
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  Speaker 2: companies land and expand in Australia.
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  Speaker 1: We'd been talking Tesla, of course, but also byd Polestar
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  Speaker 1: and many many more.
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  Speaker 2: But now the Australian Automobile Association has done some testing
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  Speaker 2: on these evs and juzy boy, guess what they found
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  Speaker 2: That none of the nine tested actually reached their advertised range.
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  Speaker 1: In fact, MG's MG four was actually the worst performer.
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  Speaker 1: It's cut drove thirty one percent shorter distance that its
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  Speaker 1: battery range promise. The Tesla model why perform the best,
• 3:33
  Speaker 1: missing its promise range by just three percent, and Beman Well.
• 3:36
  Speaker 1: Demand for EV's continue to grow in Australia. Range anxiety
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  Speaker 1: is still one of the major obstacles ol, So what's
• 3:42
  Speaker 1: the key learning here? Nothing dense a fast growing market
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  Speaker 1: like a gap between what's promised and what is delivered.
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  Speaker 2: Ooh, you went there, Juzzy boy. Range anxiety is still
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  Speaker 2: the biggest psychological hurdle stopping many Australians from actually going electric.
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  Speaker 1: Yeah, it's that little voice in your head saying will
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  Speaker 1: I actually make it home with the battery right?
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  Speaker 2: Or will I end up stranded next to a BP
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  Speaker 2: eating a cornetto while I wait for my car to
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  Speaker 2: be towed.
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  Speaker 1: But babe, man, the demand for electric vehicles is real yep.
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  Speaker 2: The Australian Automobile Association reported that in the September quarter,
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  Speaker 2: battery electric vehicles made up almost ten percent of all
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  Speaker 2: new car sales.
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  Speaker 1: Which is the highest proportion on record. The Judge boy.
• 4:18
  Speaker 2: When advertised battery rangers don't match real world performance, it
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  Speaker 2: causes the take up of electric cars to slow down.
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  Speaker 1: So be man. If eat makers and regulators want more
• 4:27
  Speaker 1: Azzies to feel comfortable switching to electric, they need to
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  Speaker 1: close the gap between what's promised and what's delivered.
• 4:32
  Speaker 2: For our third and final story, the Magnum ice cream
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  Speaker 2: Company is demerging from its parent company Unilever and will
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  Speaker 2: officially be known as the largest ice cream company in
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  Speaker 2: the world.
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  Speaker 1: Do not touch the Magnum, Ago Beeman, do not touch it,
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  Speaker 1: hands off it. What is the scoop here?
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  Speaker 2: Well Streets, cornetto ben and Jerry's and Magnum are four
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  Speaker 2: of the top ice cream brands in the world.
• 4:53
  Speaker 1: Judge, boy, Am I right? You're right? And they're all
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  Speaker 1: owned by one big company.
• 4:57
  Speaker 2: Well, since twenty twenty, you know, ever have kind of
• 4:59
  Speaker 2: become the underlaws so of the ice cream business.
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  Speaker 1: Yea, they've been generating over seven point nine billion euros
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  Speaker 1: just selling frozen snacks.
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  Speaker 2: Except Unilever also owns brands like Dove Beauty and Rexona
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  Speaker 2: deodorant and Vasoline.
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  Speaker 1: I believe a completely different supermarket alway man.
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  Speaker 2: Yep, partly why Unilever has decided to demerge their ice
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  Speaker 2: cream family.
• 5:17
  Speaker 1: Soon, the Magnum ice Cream Company will independently list on
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  Speaker 1: the Urinext Amsterdam, the London Stock Exchange and the New
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  Speaker 1: York Stock Exchange, and as part of this de merger,
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  Speaker 1: Unilever will retain a minority twenty percent stake to help
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  Speaker 1: with the transition, but Magnum will officially become the new
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  Speaker 1: ice cream leaders of the world, which means they will
• 5:34
  Speaker 1: own over one fifth of the world's global ice cream
• 5:36
  Speaker 1: market as part of this company spin off. Wow, So
• 5:39
  Speaker 1: what is the key leading here?
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  Speaker 2: A company spin off is when a big company takes
• 5:42
  Speaker 2: one part of the business and turns it into a separate,
• 5:45
  Speaker 2: independent company.
• 5:46
  Speaker 1: With its own name, its own leadership, and its own shareholder.
• 5:48
  Speaker 2: Yep, it's basically the corporate version of a grown up
• 5:51
  Speaker 2: child moving out of home.
• 5:52
  Speaker 1: But Ben Man, why is Unilever exiting the ice cream business?
• 5:55
  Speaker 2: Well, selling ice cream is a completely different game to
• 5:57
  Speaker 2: selling beauty and personal care products.
• 5:59
  Speaker 1: Think different supply chains, different consumer trends, different growth strategies too.
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  Speaker 2: So separating the two businesses will make it easier to
• 6:06
  Speaker 2: manage and give each company a better chance to innovate
• 6:09
  Speaker 2: in their own category.
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  Speaker 1: And man, this is pretty common for publicly traded companies
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  Speaker 1: to merge and emerge, kind of like that's going out
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  Speaker 1: of fashion.
• 6:15
  Speaker 2: Remember when EBA used to earn PayPal before they went
• 6:18
  Speaker 2: their separate ways in twenty fifteen.
• 6:19
  Speaker 1: Since then, PayPal has grown into one of the most
• 6:21
  Speaker 1: successful fintech companies in the whole wide world.
• 6:24
  Speaker 2: So, Jose boy, it's crunch time for Magnum as investors
• 6:26
  Speaker 2: watch what they can serve up as an independent company.
• 6:29
  Speaker 1: Fox Am, if you've been listening to all the pod
• 6:31
  Speaker 1: stories this week and the Fox app, you are in
• 6:33
  Speaker 1: a prime position twin fifty bucks today. All you've got
• 6:36
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• 6:40
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• 6:42
  Speaker 1: win fifty bucks today.
• 6:43
  Speaker 2: Thanks for listening and we'll see you on a Monday