Issue link: https://maltatoday.uberflip.com/i/774426
maltatoday, WEDNESDAY, 18 JANUARY 2017 11 Business Today www.creditinfo.com.mt info@creditinfo.com.mt Tel: 2131 2344 Your Local Partner for Credit Risk Management Solutions Supporting you all the way GRTU welcomes 2016 sales levels, says 2017 should be better Paul Cocks 36% of businesses registered an increase in sales in 2016 when compared to 2015, equal to the number of businesses that said Sales were the same as in the pre- vious year, while 28% said they fared worse than in 2015, accord- ing to a business performance sur- vey by the small enterprises cham- ber, the GRTU. The report surveyed 175 businesses across all industries, including retail, construction, IT, wholesale and accommodation. Marcel Mizzi, vice-president for finance and administration at the GRTU, said that many of the businesses that registered an increase in sales in 2016 attributed it to the introduction of new products or services and to better consumer spending power. "Of these, worryingly, only 1% attributed their increase in sales to their decision to set up an e-commerce site," he said. Online shopping remains a low priority for businesses, with only 22% currently selling online. Of those that do not offer e-commerce services, 37% believe their products cannot be sold online, while 24% insist their clients do not buy online. As for 2017, 41% of businesses expect it to be better than 2016, with only 15% believing it will be worse. GRTU president Paul Abela said the new legislation on Sunday shopping should help businesses even more, although the chamber would be contesting the €700 fee that remained compulsory for businesses that choose to open seven days a week. "This is particularly unfair to small shops and businesses, many of whom cannot afford the fee, and who could benefit greatly from opening seven days a week," he said. Mizzi said that many respondents had complained of unequal competition from overseas, citing high shipping costs as being of major concern. Illicit competition – such as illegal imports from Sicily and the payment of VAT and excise duty – traffic congestion and staff shortage received many complaints. Abela said lack of staff was possibly the major concern, with businesses complaining they could not find anyone to employ, even for the most basic jobs. "For every 50 replies received in reply to a vacancy advert, 45 would be from foreigners, living abroad, who would be prepared to move to Malta because of better wages than in their home country," he said. He said that, because a visa application takes six months to process, businesses often resort to employing foreigners 'off the books', without registering them. "It is no secret that there are possibly anything like 8,000 Serbs currently working in Malta," Abela said. "And yet, there are only 800 to 1,000 registered to be working here." 53% of respondents also said that their sales were affected by the Christmas festivities, with two per cent saying they were 'very satisfied', and 22% being 'satisfied' with their sales figures over the Christmas season. Another two per cent said, instead, they were 'very dissatisfied' with the total sales over Christmas. A further 11% said they were 'dissatisfied'. GRTU President Paul Abela (left) said the new legislation on Sunday shopping should help businesses even more British American Tobacco takes control of Reynolds for $49 billion Tobacco giant British American Tobacco has agreed a $49.4 bil- lion takeover of US rival Reyn- olds American Inc, creating the world's biggest listed tobacco company after it increased an ear- lier offer by more than $2 billion. The UK company has been in talks with Reynolds for months about buying the 57.8% stake it does not already own. The merger would bring together some of the tobacco industry's best-known brands, including Lucky Strike, Rothmans, Dunhill and Camel cigarettes. A merger "creates a stronger, truly global tobacco" business, British American Tobacco (BAT) said. BAT, a shareholder in Reynolds since 2004, said last year that the merger was "the logical progression in our relationship". However, the British company's initial approaches were rebuffed by Reynolds, and a $47 billion offer was rejected last November. BAT estimates that it can make $400 million worth of cost- savings through the merger. Reynolds has been operating since 1875 and is the second largest tobacco company in the US after Altria, which owns Philip Morris USA. BAT Chief Executive Nicandro Durante said bringing the two companies together would create a market leader with brands including Newport, Lucky Strike, Camel and Pall Mall. "It will create a stronger, global tobacco and NGP (next generation products) business with direct access for our products across the most attractive markets in the world," he said on Tuesday. The US tobacco market was the most profitable outside China, he said in an interview, and BAT "figured there was some room to grow there". Last year, Reynolds completed its $25 billion takeover of US rival Lorillard. The combined company was forced to sell off a number of brands, including Kool, Salem and Winston, to satisfy regulators. They were eventually bought by Britain's Imperial Tobacco for $7.1 billion. BAT products include Rothmans, Kool and Kent, while Reynolds' brands include Newport, Camel, Pall Mall, Doral, Misty and Capri. The UK company has more than 200 brands, and is a big player in the market for e-cigarettes. The takeover will give it a further foothold in the US, and give the combined business a significant presence in high-growth markets including South America, the Middle East and Africa.