fun Archives - Compare Business Bills

The Biggest British Business Mistakes and Disasters

Compare Business Bills Editor — Thu, 12 Dec 2024 13:09:05 +0000

The UK has always punched above its weight historically in terms of its business and industrial prowess. But we can also make some extraordinary goofs as well. Here are a few.

Gerald Ratner and jewellery that was cheaper than an M&S prawn sandwich

Some people can do everything right and need only one mistake to bring everything down. Take Gerald Ratner – he destroyed his entire jewellery empire in 1991 with one speech. In only a few short years, Gerald Ratner had made The Ratners Group into one of the most valuable and fastest growing companies in the UK, with a peak valuation in 1990 of £840 million. Only one year later, standing in front of the Institute of Directors, he called his own products “total crap” and joked that his earrings were “cheaper than an M&S prawn sandwich but probably wouldn’t last as long”, presumably in a misguided attempt at self deprecation. The next day, his company lost £500 million in value. Just like that. The gaffe was so infamous that “doing a Ratner” is still common parlance for a grievous foot in mouth moment. Soon after, The Ratners Group almost collapsed (surviving as the Signet Group). You can watch the toe curling video below, where Gerald destroys half a billion pounds of value in just a couple of minutes:

Marks and Spencer try to crack America

Marks & Spencer tried to crack America in the 1980s. They waltzed in thinking everyone would love their very British ways. They didn’t. Americans found the sizes confusing, hated the British style clothing, and couldn’t understand why a store would sell both underwear and sandwiches. M&S lost nearly $1 billion before admitting defeat.

Royal Bank of Scotland and Fred the Shred

Speaking of absolute disasters, remember when RBS bought ABN AMRO in 2007? They paid £49 billion right before the financial crisis hit. Oops. They didn’t check the books properly and ended up buying a bank stuffed full of toxic assets. The British government had to step in with the biggest bank bailout in history. The CEO still got his pension though, so that’s nice.

Hoover and free flights to America

Hoover made a mind-boggling decision in 1992. They offered free flights to America for anyone spending £100 on their products. The flights were worth way more than the vacuum cleaners. People bought vacuums they didn’t need just to get the tickets. Hoover lost £50 million and their entire European division got sold off. Marketing genius!

Northern Rock collapse

Remember Northern Rock? In 2007 they thought they’d found a brilliant new way to make money – borrowing short-term cash to fund long-term mortgages. When the credit crunch hit, everything fell apart. People queued for blocks to pull their money out. It became the first British bank run in 150 years. The government nationalised it, and taxpayers picked up the bill.

Tesco tries to crack America

Let’s talk about Tesco’s American dream. Fresh & Easy was supposed to revolutionize American shopping. They spent billions setting up stores that Americans just didn’t want to visit. The self-checkouts confused people, the portions were too small, and Americans found the stores cold and clinical. After losing £2 billion, Tesco gave up in 2013.

Cadbury makes their chocolate cheaper (and everyone hates it)

The British chocolate company Cadbury tried to be clever in 2009. They changed the recipe of their Creme Eggs from dairy milk chocolate to a cheaper alternative. People noticed. They really noticed. Sales dropped by £6 million in just a few months. When Kraft (now Mondelez) bought Cadbury, they stuck with the cheaper recipe. People still complain about it.

British Airways terminal 5 launch

British Airways had a complete nightmare in 2008 when they opened Terminal 5 at Heathrow. They’d spent £4.3 billion on it, but on opening day the baggage system collapsed. They cancelled 500 flights and lost 23,000 bags. The chaos lasted for weeks. But hey, at least the building looked nice.

HMV thought mp3s were a fad

Bonkers decisions? How about when HMV ignored online music in the 2000s. Their CEO said digital downloads were just a fad. Amazon and iTunes ate their lunch. They went from 400 stores to virtually nothing. They still exist (via various rescues), and have even regained their flagship store on Oxford Street, but they’re a shadow of their former selves.

Companies House killed a business with a typo (and got sued for it)

The prize for most expensive typo goes to Companies House. In 2009, they accidentally listed Taylor & Sons Ltd as going into administration instead of Taylor & Son Ltd. The extra ‘s’ killed the wrong company. The 124-year-old business lost all its contracts overnight. They sued Companies House and won £9 million in damages.

Barclays and the LIBOR scandal

Barclays tried to be smart in 2012. They figured they could manipulate LIBOR rates (the rates banks use to lend to each other) to make more money. They got caught. The fine? £290 million. Their CEO lost his job, their reputation got trashed, and they’re still dealing with the fallout.

British Leyland and the Austin Allegro

Remember when British Leyland thought they could take on the Germans in the car market? They made the Austin Allegro – a car so badly designed that its square steering wheel would sometimes fall off. The windows would pop out if you jacked up the car. They managed to make a car that literally broke itself.

The death of Thomas Cook

More recently, Thomas Cook collapsed in 2019 after 178 years in business. They needed £200 million to survive but couldn’t get it. They stranded 150,000 holidaymakers abroad and lost 21,000 jobs. They’d stuck to the same old package holiday model while the world switched to booking flights and hotels online.

Pick ‘n’ mix couldn’t save Woolworths

And who could forget Woolworths? They watched as pound shops took their cheap items market, supermarkets took their pick ‘n’ mix, and Amazon took everything else. They just kept doing the same thing until they went bust in 2008. Nine decades of British retail history gone because they couldn’t work out what they were supposed to be selling. Occasionally, rumours surface that Woolworths will return to the high street, though these are always some joker pranking a nostalgic (and somewhat gullible) public.

The post The Biggest British Business Mistakes and Disasters appeared first on Compare Business Bills.

The UK’s Weirdest Taxes

Compare Business Bills Editor — Thu, 12 Dec 2024 12:31:09 +0000

HM Revenue and Customs used to use the line “Tax doesn’t have to be taxing” in its adverts in the 2000s (you might remember them). But most would agree, that to one degree or another at least, it is taxing. On the brain, on the wallet, and, at times, on the spirit. In fact the person who spoke that famous phrase even went on record wishing that the chancellor would make the tax system simpler.

Forget 2p coins, we used to be able to pay our taxes in eels

So tax does have to be taxing, but it doesn’t have to be… boring? Just ask the medieval British who paid their taxes in eels. Yes, you read that right – eels. During the Middle Ages, landlords would collect rent in the form of eels because they were such a popular food. The city of Cambridge alone used to pay 45,000 eels a year to the King. It somewhat puts protest payments in 2p coins into context.

The beard tax of 1535

But it gets weirder. Tudor England had a tax on beards. Henry VIII decided that facial hair should come with a price tag, and the amount you paid depended on your social status. Elizabeth I later continued this bizarre tradition, making people pay for the privilege of growing a beard. The tax collectors would actually walk around touching people’s faces to check if they needed to pay up. Talk about hands-on government work.

The window tax of 1696

Windows caused quite a stir too. The Window Tax of 1696 made people pay based on how many windows their house had. What did everyone do? They bricked up their windows, of course! You can still spot these blocked-up windows in old buildings all over Britain today. The tax lasted until 1851, and we got the phrase “daylight robbery” from this peculiar tax.

The hat tax of 1785

Think that’s odd? In 1785, Britain started taxing hats. Every hat needed a stamp inside it to prove the tax had been paid. Hat sellers who didn’t comply faced the death penalty – a bit extreme for dodging hat tax, wouldn’t you say? The tax inspectors would raid shops looking for unstamped hats. This led to a booming trade in hat-shaped non-hats that people would claim weren’t technically hats at all.

TV licenses charged more for colour until 2020

Let’s jump to something more recent – Britain actually had a tax on TV colours until 2020. If you owned a colour TV, you paid more than someone with a black and white set. People still owned black and white TVs just to save on the license fee – in 2019, over 6,000 homes still had black and white licenses! They finally scrapped this colour premium, but the TV license itself lives on.

The playing card tax of 1711

Have you heard about the playing card tax? From 1711, every pack of cards needed a special stamp on the ace of spades to show the tax had been paid. This tax lasted over 200 years! The government kept such tight control that only one company could print the ace of spades. People started forging them, leading to a thriving underground card game scene.

The pasty tax

Modern Britain hasn’t lost its touch for weird taxes. Take the “pasty tax” controversy of 2012. The government tried to add VAT to hot takeaway food, but this created the bizarre situation where the temperature of your pasty determined how much tax you paid. If your pasty was hot, you paid more tax. If it had cooled down, you paid less. Bakers actually started letting pasties cool just to save their customers money.

VAT on food

Speaking of food, Britain taxes some really strange combinations. A gingerbread man with chocolate eyes? Standard VAT rate. But if it has chocolate buttons? Zero-rated! Frozen yogurt? Taxed. But frozen yogurt with raisins or nuts in it? No tax! These distinctions keep tax accountants scratching their heads to this day.

Is a Jaffa Cake a biscuit or a cake? (Because it’ll determine the VAT)

Here’s a modern head-scratcher: you pay no VAT on a plain biscuit, but add chocolate to it and suddenly it’s a luxury item with 20% VAT. But what about Jaffa Cakes? McVities went to court to prove Jaffa Cakes were cakes (zero-rated) not biscuits with chocolate (standard-rated). They even baked a giant Jaffa Cake to prove their point. The key evidence? Cakes go hard when stale, while biscuits go soft. Jaffa Cakes go hard, so they won the case!

Noisier helicopters = more tax

And don’t get me started on helicopter taxes. If you land your helicopter in London, the amount of tax you pay depends on how noisy your helicopter is. They actually have people measuring helicopter noise levels to work out the tax bill. The quieter your chopper, the less you pay.

More heads on your mannequin = more tax

A particularly bizarre one involves mannequins. If you import a mannequin with a second head, you pay less tax than if you import the heads separately. This has led to some very strange-looking mannequins being shipped into the UK, as retailers try to game the system.

The fizzier the drink = the more tax

Britain still keeps creating new weird tax situations. Since 2018, you pay more tax for drinking fizzy drinks, but only if they’re fizzy enough. Tax inspectors literally measure the bubbles in drinks to work out how much tax to charge. Drink manufacturers started reducing sugar levels just enough to dodge the tax, creating this strange middle-ground of semi-sugary drinks.

The royal family and tax

Even the Queen wasn’t exempt from tax oddities. Until 1992, the monarch didn’t pay income tax – this was a gentlemen’s agreement rather than law. But here’s the weird part: the Queen still had to pay a tax called “Royal Assent”. This meant she technically paid tax on her own laws! She had to approve every tax law, thereby taxing herself.

Death and taxes aren’t as certain (it depends on how you’re buried)

Tax doesn’t end when you die either. If you get buried in a wool shroud instead of a regular coffin, you pay less tax. This comes from an old law meant to boost the wool trade, but it’s still on the books. Some eco-conscious Brits have started using this centuries-old tax break for green burials!

The post The UK’s Weirdest Taxes appeared first on Compare Business Bills.