Boulger slams network panel model

 John Charcol senior technical manager Ray Boulger has slammed the network panel model, suggesting that many clients are being denied the best deal.

He says brokers should turn clients away if they do not have a suitable lender on their panel.

He says: “The only real argument of having a panel is that you could have more sway with some of the lenders because you do a lot of business with them but there are lots of other cases where it means you cannot give your client the best deal.

“My view would be that if you do not have a suitable lender on your panel, you should tell your client you cannot place the case.”

Chadney Bulgin mortgage partner Jonathan Clark says: “I think the FSA’s definition of whole of market needs looking at. A lot of brokers claim to be whole of market but they are not. They only recommend lenders who pay them a proc fee.”

London & Country head of communications David Hollingworth says: “The arguments that people would make for using panels is that they have got a number of the major lenders on there and they do represent a large slice of the market by volume.

“But, of course, what you miss out on as a customer is the potential for other lenders which offer better deals at the time you are looking for a mortgage.

“Therefore, you are just reducing your chances of getting the best deal. It is a question that borrowers should ask brokers.”

More about → Boulger slams network panel model

Shared scheme is 'small plaster on a big wound'

Mortgage experts suggest the £250m shared-equity scheme to help first-time buyers raise a deposit will have a limited impact in boosting the housing market.

Chancellor George Osborne said the scheme would help up to 10,000 first-time buyers raise a deposit for a newbuild property. Borrowers have to raise 5 per cent deposit and the Government and homebuilders will offer up to 20 per cent of the mortgage between them as a low-interest loan.

Your Mortgage Decision director Dominik Lipnicki says the Government has missed an opportunity to fix the housing market. He says: “It is putting a small plaster on a big wound. It will help a few thousand people but will not make any material changes to the housing market.”

First Action Finance head of communications Jonathan Cornell says: “My concerns are it does not help the first-time sellers. Those people cannot really move up the ladder. It is all very well for the Government to launch schemes but, unless lenders accept them, it is not going to work. Similarly, lenders, as a rule of thumb, are more cautious about newbuild property.”

MAC Consulting chief executive Mark Chilton is concerned that homebuilders could inflate prices. He says: “If you are a developer, all you have to do is add 10 per cent to the value and mark it off as a qualifying FirstBuy property. My suggestion is that they must be subject to independent valuation for it to work.”

More about → Shared scheme is 'small plaster on a big wound'

Addison Lee's Business is booming despite economic climate

The company, which operates 2,600 minicabs and a luxury fleet of 200 VIP cars in London, announced a turnover of £105 million for 2010-11, up 19% on last year.

Addison Lee, which serves over 16,000 corporate clients and carries 10 million passengers per year saw bookings rise by 24% in 2010. Profit after tax was £3,255,515 (up from £1,717,830 the previous year).

John Griffin, founder and chairman of Addison Lee said: “Our performance this year proves that smart businesses can thrive in the recession. Addison Lee has continued to invest in new vehicles and new technologies such as iPhone and Blackberry booking applications and now we’re reaping the rewards.”

“Big businesses in the City may have been focussed on reducing costs but it’s clear that Addison Lee’s competitive pricing and superior service has made us the de-facto choice for corporate travel in London.”

“I have always said that the recession would act like a colonic irrigation for the economy; flushing out badly run or uncompetitive businesses, so it’s very pleasing to see that our commitment to professionalism and technological innovation has helped us to grow as our rivals are fading.”

More about → Addison Lee's Business is booming despite economic climate

It takes more than money and magic to succeed

Patti and David Bailey own Motormouse, creating and marketing novel wireless computer mouse devices which look like sleek, shiny miniature cars, available in the form of a classic sports car or Mini Cooper models. They now know what an impact there is when a “Dragon” breathes fire into your business.

The clever couple took Motormouse to the Dragons’ Den, where they impressed James Caan, both with their product and business acumen. He agreed to invest £120,000 to help Patti and David open up markets for their unique gadget, and develop a complementary product range.

Now Patti and David are seeing their product literally “take off”. The Motormouse is a top in-flight seller on a variety of airlines, including British Airways, Emirates, Etihad and KLM, and they are currently flying off the shelves at Harrods. Recently the Bailey’s have successfully negotiated deals in 11 destinations abroad, and the Motormouse is now gracing desks from Australia to Turkey, the USA to Norway.

“Our association with James (Caan) has been extremely positive and enormously rewarding,” says Patti, “but anyone who thinks that we just had to stand by while he waved a magic wand to make us successful should think again.”

Right from the outset the Baileys decided they were not going to expect Mr Caan to “do it for us”.

David explains: “We have controlled our own activities, sales, and business mechanics, taking advice and guidance as we progressed. The result is a flourishing partnership between us and Mr Caan’s team, which has opened up a joint investment vehicle so in turn we can help others.”

He said that Caan had helped the company to negotiate new contracts, access otherwise inaccessible markets, and assisted in numerous other ways besides the actual financial investment.

“There is a myth that once you have ‘made it’ on Dragons’ Den the sky’s the limit. This is not necessarily true – it’s what YOU do and the effort you put in that makes the difference, no matter how much help you get along the way.”

Patti and David are in agreement, though, that being associated with a Dragon was the catalyst which they needed to set Motormouse on the road to success.

“James (Caan) has always been accessible, personable, and extremely supportive. We meet with him and his team frequently and have the use of their Mayfair offices for our London-based meetings. His support can’t be quantified in money terms – it’s not just a case of stumping up cash. The investment of time, ideas, guidance and PR association has inestimable value,” says Patti.

Mr Caan commented: “The Baileys are a fine example of an enterprising partnership who didn’t sit around hoping they’d get lucky, but went out and created their own luck. I am delighted to have spurred them on their way, and look forward to continuing to work with them in the future.”

More about → It takes more than money and magic to succeed

Sterling falls back on weak retail figures

Sterling is falling back against the dollar after news that British retail sales fell more than expected in February.

Data from the Office for National Statistics (ONS) showed sales fell 0.8% in February after a jump in prices, which was only partly due to the rise in VAT.

Steeper than the 0.6% drop predicted and following January's 1.9% rise, this sign of consumer weakness saw sterling weaken by half a cent to $1.615.

The pound had traded above $1.64 on Tuesday after a high inflation reading saw the money markets bringing forward their expectations of a rate rise.

But it fell back yesterday when UK growth forecasts were downgraded in George Osborne's Budget. GDP growth projections were lowered this year from 2.1% to 1.7%, and the 2012 forecast from 2.6% to 2.5%.

With consumer spending accounting for more than half of the economy, today's figures deliver a blow to hopes that GDP will achieve a strong recovery from the 0.6% contraction seen in the final quarter of 2010.

Hetal Mehta, of Daiwa Capital Markets, said: 'I can't say I'm surprised by the sharp fall in retail sales in February. The January bounceback - which has been toned down - was clearly in response to the the adverse weather conditions in December.

'Today's figures prove that underlying conditions in the retail sector are weak. Consumers are being buffeted by falling real wages and high unemployment, which are undermining consumer confidence.'

Although it follows a series of gloomy updates from retailers including Sainsbury's and John Lewis amid slowing sales growth in recent weeks, better results today from B&Q owner Kingfisher and Next provided evidence of cheer in the sector.

The ONS said there was downward pressure on all retailers in February, apart from those selling petrol and goods for cars. Household goods stores, which include DIY and electronics retailers, saw a 2.5% decline in volumes from January, with sales of music and video recording equipment down 12.6% on a year ago. Supermarkets and food retailers saw volumes decline 2.2% on the previous year, marking the 13th month of declining figures in a row. Non-store sales, which include internet and mail-order firms, also saw month-on-month sales volumes growth slow to 17.3% in February.

Vicky Redwood, senior UK economist at Capital Economics, said: 'This drop in sales volumes adds to evidence of a significant slowdown in consumer spending in the last few weeks.

'The level of sales has now fallen below the pre-snow level in November, suggesting an underlying slowdown is at work. What's more, the outlook for spending remains pretty bleak. Although the Chancellor provided some modest help for consumers yesterday, real incomes still look set to fall sharply this year.'

Alan Clarke, from BNP Paribas, took a more stoic line: 'It could have been even worse given the plunge in consumer confidence and higher inflation. Retail sales are going to be weak all year. We just have to get used to it.

More about → Sterling falls back on weak retail figures

Chris Brown Defends Good Morning America Outburst Via Twitter

Chris Brown, who has been desperately trying to rehabilitate his image in order to sell his new album F.A.M.E, reportedly exploded behind the scenes at Good Morning America this morning, according to reports.  Apparently, he wasn’t thrilled with GMA anchor Robin Roberts, who asked him on-air about the 2009 Rihanna assault.

The singer, like many stars in a public relations crisis, quickly (perhaps too quickly!) turned to Twitter and his two million-plus followers to defend himself.

Brown tweeted at 9:49 a.m., “I’m so over people bringing this past s**t up!!! Yet we praise Charlie sheen and other celebs for there bulls**t.”

That ill-advised tweet was quickly removed and followed up with this fan-friendly message: “All my fans!!! This album is for you and only you!!! I’m so tired of everyone else!! Honestly!! I love team breezy!!”

He tweeted a similar message moments ago, “#FAMEnumber1 I love all my fans and teambreezy!!! I hope this album is everything you wanted!”

For Brown, today’s behind-the-scenes drama is the last thing he needed in his career rehabilitation tour.  Will his album sales be affected by this type of behavior?  Stay tuned.

Mark Pasetsky is the editorial director of CoverAwards.com.  Follow mark on Twitter @coverawards

More about → Chris Brown Defends Good Morning America Outburst Via Twitter

Mock Rebecca Black All You Want, She’s Laughing To The Bank

Rebecca Black has a hit song. The 13-year-old singer’s video for her song “Friday,” which has quickly become the fascination of the Internet, is a smashing success despite the fact that it owes its meteoric rise to, well, mediocrity. Put more bluntly, the video has become the laughingstock of millions, who have latched on to its simplistic lyrics and low-price polish to push it into the public consciousness. Despite the movement’s dubious beginnings, though, Black may be the one laughing now.

The “Friday” video — which was uploaded to YouTube on February 10th — didn’t get much traction until early last week, when it suddenly caught a web tailwind. Black’s name trended on twitter and the video spiraled to go viral. It now has over 30 million views. For those of you who haven’t seen the video, which debates morning routines, car seat selection and the days of the week, while celebrating the weekend, check it out below:
So is it true that any press is good press? For the young singer, who has appeared gracious and composed in her few media appearances, that axiom seems to hold true. And her decision to keep the video online, despite being given the opportunity by the song’s producers to take the video down when the comments started to turn nasty, may end up to be a boon to her college fund.

Black’s tune comes courtesy of Ark Music Factory, a so called record label that churns out tween pop for a couple thousand bucks a tune. Co-founded by Patrice Wilson and Clarence Jey, the L.A. based company courts young teenage singers and “signs” them to short, vanity recording projects. Jey reportedly is the lyrical genius behind “Friday.” According to The Daily Beast, Black’s mother forked over $2,000 for two songs written by Ark Music Factory’s team and one video, the now infamous “Friday.”

It would seem that the investment paid off, many times over. Although the YouTube/Google party line on video ad revenue is vague (“There are no guarantees under the YouTube Partner agreement about how much you will be paid.”) some digging turns up speculation on potential profits. TechCrunch’s Erick Schonfeld reported today on Google and YouTube’s revenue figures. Looking at 2010’s actual numbers, the site makes about $1 per thousand page views. For videos running ads as part of the revenue sharing program, that revenue is then split between YouTube and the content creator. Content creators, or partners, take 68% of the profit. At 30,000,000 views, that lands Black and Ark Music Factory $20,000 – a 1000% return on investment. That number matches the figure reported by Damian Kulash Jr., the lead singer of indie pop band OK Go, who have made a name for themselves via viral videos.

The revenue doesn’t stop there, though. Where Google has had a notoriously tough time monetizing YouTube content, Apple’s iTunes has had significantly fewer problems. Since hitting the online music store last Monday, “Friday” has amassed a staggering number of downloads, reportedly topping 2 million; the song currently sits at #45 on the iTunes Top Singles chart. According to 101 Distribution, an independent music distributor, iTunes pays out $.70 per single download in the United States. That’s a much juicier check for Black and Ark Music Factory; even if the numbers are exaggerated, the intake from “Friday” could top $1 million. What’s more, Black is planning to release an acoustic version of the song to disprove speculation that her voice is reliant on AutoTune. Cha-ching! Update: As an astute commenter points out, that estimate number of downloads is likely an overshot. Although iTunes has not released sales numbers, it seems more likely that the song has a few hundred thousand downloads (and counting) rather than 2 million. The song is also for sale on ArkMusicFactory.com, Amazon.com, CDBaby.com, and other online retailers.

According to The Daily Beast, Black plans to donate a portion of her profits to “Japan relief organizations and school arts programs.”

Like it or not, there’s probably more to come from Rebecca Black and Ark Music Factory. As I type, another Ark Music product, Alana Lee, is racking up views by the tens of thousands on her video “Butterflies,” likely basking in the afterglow of Rebecca Black. Fun, fun, fun indeed.

More about → Mock Rebecca Black All You Want, She’s Laughing To The Bank