Entrepreneur calls on government for speedy legislation to create level playing field
Legislation to bring Chinese marketplace Temu and the like in line with UK businesses is being urged by retail entrepreneur and former TV Dragon Theo Paphitis.
He was among the keynote speakers at Spring Fair last week, where his impassioned plea to the UK government was to get a move on with closing loopholes that allow large offshore businesses such as Temu to avoid paying import duties and other taxes.
Speaking after many greeting card publishers had vented their frustrations at the sheer volume of copycats and plagiarism of designs the platform allows to proliferate, Theo told his packed audience: “Temu are operating legally but exploiting international rules that allow them to cross borders without regulation, shipping products directly from China to here.
“They don’t pay VAT or import duties. They’re not paying corporation tax. They’re not employing people in the UK. They are not paying national insurance – all of which means they have an unfair advantage.
“It’s not a level playing field, and the only outcome is that they will destroy our UK market leading to the demise of our own High Streets.”
He was being interviewed on the Inspiring Retail Stage by Lauretta Roberts, co-founder, CEO and editor-in-chief of The Industry, shortly after Temu’s e-commerce leader Thomas Wintle had given a 15-minute talk on Empowering Independent Retailers: The Future Of E-Commerce And Consumer Experience.
In the Masterclass Studio situated in the greeting card hall, Thomas explained he is part of the Temu’s new UK team – which is based in Dublin – and pushed the idea of British sellers joining the platform, only for all questions and audience feedback to be about the widespread copyright issues, treatment of workers, and sustainability concerns.
Theo cited a recent investigation by the British Toy & Hobby Association (BTHA) which revealed some toys imported to the UK from China do not meet British health and safety rules as there’s no regulation and no compliance with environmental, social and governance (ESG) standards.
“We don’t know where things are produced, or how they are produced,” he added. “The British government is currently looking at Temu, but they must legislate quickly because we need to get things on a level playing field fast. The company must pay their fair share.”
The owner of the Ryman retail chain, which now has a significant greeting card offer notably in its Ryman Design stores, Theo also showed his support for the GCA’s petition calling for parliamentary scrutiny of any plans to amend the universal service obligation affecting Royal Mail’s service, which now has nearly 7,000 signatories, getting close to the 10,000 needed for the government to respond – if it hits 100,000 it will be considered for debate in parliament.
Emphasising the current tough retail climate he said: “The government needs to put confidence back in the economy and in business, so that we can get those green shoots. However, you can’t start from zero and get growth, but we need medium initiatives now.”
Asked by Lauretta what retailers could do to create confidence, he commented: “There’s no point in doing the same thing over and over again. We have to take a few minutes out to start thinking how can we do things differently. Businesses need to think about what they’re doing and if there’s a different way to do it. They need to ask themselves ‘what are my USPs’, ‘what is my reason for existing in this market’, ‘how can I do things better’?
“I’ve always looked at what other people are doing and thought that I could do it better. You have to ask yourself, ‘where is my place in this’, ‘how can I execute it better’?”
He added that persistence and confidence are key attributes for business owners. “I’ve always been a supporter of small businessesbecause that’s where I started out, with one desk, one phone, one line, one assistant. It was a daily hustle.
“The one thing you must have as a small business, or any sized business, is confidence in your USP, your reason to exist on the High Street.
“We have heritage brands such as Ryman and Robert Dyas and have to have the right proposition for the consumer to cross our threshold and to come into our stores, and we’re using technology to do that. Once they’ve come into the store, we can show them what else we’ve got.”
As for business rates, he said they make physical retail “horrendously expensive”, but acknowledged they represent a large chunk of the government’s revenue.
“They need to replace them with something else,” he stated. “And, while legitimate online businesses do a great job, they don’t pay tax, yet need to pay their fair share like everyone else. There aren’t the same pressures on the online companies, so we have tolevel the playing field, and the government must legislate. If not, it will kill the High Street.”
