B&Q and the new VAT rate

[BradNaylor]

Anyone else noticed how B&Q are handling the new 15% VAT rate?

All the prices in the store remain the same; they are simply knocking off 2.12% discount at the till.

Seems reasonable, until you think about it...


For them to change away from this system, they would have to re-price every product in every store simultaneously!

It will be interesting to see what happens after Christmas.

I suspect that this is merely a holding policy until the dust settles at which point the discount will quietly disappear, with the retail prices remaining at the old level.

Dan

 

[MIGNAL]

You 'suspect' Dan. Of course you really don't know what their policy will be, unless you have some insider information. It's almost like you are complaining before the event.

 

[Terry Smart]

Seems reasonable, until you think about it...

So are you saying this is unreasonable?

For the record, I'm not so sure it would have been that difficult; B&Q use bar codes so the stock itself wouldn't have to be repriced all at the same time, just the computer record.
I'm pretty sure B&Q sell items that are zero rated (are books still zero rated?) so that would suggest to me that their system is able to apply vat at different rates to different items; most companies use a system where one set of goods is charged at rate A, another at rate B. Therefore, if the system was set up with some forethought, only rate A (or B of course) needs to be changed.
Then, the company just needs to put signs up saying that the new VAT rate will be applied at the tills.

 

[wizer]

B&Q's system is certainly odd. It took them a very long time to introduce chip and pin. But I think you're right Terry, it would be quite bizarre to have a computerised system, that can display a picture of each item they sell on their POS screen, but not have the ability to alter vat rates via the main database.

 

[BradNaylor]

You 'suspect' Dan. Of course you really don't know what their policy will be, unless you have some insider information. It's almost like you are complaining before the event.

It just seems an odd way of doing it.

As Wizer and Terry have said, a simple change to the VAT rate in their computer system would have resolved the problem completely; the price tickets and signs in the store could then have been changed gradually over a manageable period of time. I'm sure this is how other big retailers such as John Lewis and Sainsburys are handling it.

Terry's point about books is interesting. On my visit to B&Q yesterday I paid at the self-service till; the girl there just took off 2.12% without even looking at the items I had bought. I might just go and buy a book later to test them out. I bet they give the discount!

Could it be that the 17.5% VAT rate is hard coded into their system?

Surely not...

 

[wizer]

I might just go and buy a book later to test them out. I bet they give the discount!

Problem there is even with the 2.12% discount, their books are often much dearer than you can get them elsewhere.

 

[busy builder]

B & Q are no different to our local Morrisons, which are doing the same thing, taking the VAT off at the till.

 

[matt]

For the record... John Lewis reduced their prices on the system in the week before the reduction in VAT actually occurred. The shelf edge labels and prices on the products will be changed more gradually (it's a mammoth task, particularly when you consider most products are delivered with prices already on - i.e. lots of stock in the pipeline).

Simply changing the price on the system is a huge undertaking. For example... Retailers will perhaps shy away from simply discounting by the percent as it will leave an odd price. Also, not only do you have to exclude products such as fuel (5%) and books (0%), you have to calculate the rate for products with composite rates (e.g. a pepper mill (17.5%) with pepper in it (0%)) or, in B&Q's case... a gas burner including a gas cannister.

Then there's Waitrose... most products are VAT free, however, they used the VAT discount to provide deep discounts on a number of key lines.

I wouldn't second guess what retailers are doing - it's very complex to apply the reduction.

 

[motownmartin]

Anyone else noticed how B&Q are handling the new 15% VAT rate?

All the prices in the store remain the same; they are simply knocking off 2.12% discount at the till.

Seems reasonable, until you think about it...

Asda are doing exactly the same and I have thought about it but don't see anything unreasonable about the way they do it :? it seems to me to be the most cost effective way to do it.

 

[slemishwoodcrafts]

hi all,

Just thought i need to clarify this for you all. I work part time at B&Q and the VAT reduction will be permanent until it is changed again. It is unreasonable to think we can change all the labels in a store in one go especially in a warehouse store. The labels with the new 15% VAT will be phased in through the weekly price changes that occur throughout the store

regards,

michael

 

[lemonjeff]

I'd have to agree with Dan here, in as much as when we've forgotten the VAT reductions will companies gently raise the prices back up to 17.5% levels to gain extra profits?
Stranger things have been known to happen in rip off Britain.

Jeff.

 

[NickWelford]

Wife and I bought a small table yesterday. Asked the cashier if the new VAT rate had been applied. Don't know, she said, I'll ask the manager.
After a lot of hanging around etc, eventually we tracked him down.
Yes, he said.
But the price is the same as last week, said I.
Yes, I'm keeping the difference - do you know how difficult retailing is these days?

I bet a lot of this is going on, particularly in small retailers.......

 

[wills-mill]

Our local small department store have the VAT rate as a discount at the bottom of the receipt- Darling's Discount

 

[CWatters]

If you buy a book in BnQ point out that books are zero rated...and she might take 17.5% off

 

[tsb]

I've been looking for a range cooker for my new kitchen. Before the VAT reduction the price was £1050, after VAT reduction the price is now £1085. I think I might wait for the sales, I might get it for £1100 if I'm lucky

 

[motownmartin]

I've been looking for a range cooker for my new kitchen. Before the VAT reduction the price was £1050, after VAT reduction the price is now £1085. I think I might wait for the sales, I might get it for £1100 if I'm lucky

Funny you should say that.

A couple of weeks ago I bought a new telly for £650, two days later it was £730 :? I reckon they put the price up for Christmas.

 

[Jake]

It's the £.