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Brexit viewed purely in economic term

The EU has certainly brought benefits to the UK. However, these benefits have come at a cost and this cost has been distributed unevenly across the UK. By cost, I don’t mean the annual contribution that we make but more the hidden costs associated with membership. In joining we have had to accept the demise of industries once at the core of UK life (fishing is an example) as well as turn our backs on countries outside the UK with which we have had historical trading ties (typically through the Commonwealth).

Image: istock

In addition, the introduction of the free labour movement has seen not only the useful movement of skilled labour into areas where it is needed but also the flooding of the semi-skilled and unskilled markets with cheap labour. Bringing costs down is not a bad thing, but there are inevitably social consequences when it is achieved by reducing labour costs rather than improved processes.

In communities dependent on supplying labour into these latter markets, jobs have either become scarcer (supply of labour outstripping demand) or it has resulted in a depression in the wages paid to people as employers have a bigger potential workforce from which to draw (and the appearance of zero-hour contracts). In addition, these communities have found themselves inundated with migrant labour which has not only put pressure on existing infrastructure (hospitals, schools, etc) but has also alienated some people who feel like strangers in their own communities.

Migration in these areas has been more akin to an invasion rather than a steady integration. So, in short, the hidden costs of the EU have been distributed unevenly throughout the country. Add to this the pressure of austerity measures introduced following a recession caused entirely by the greed of unscrupulous financiers and you have the potential for large swathes of the population feeling ignored and disenfranchised.

Now throw into this mix the idea that the population of the UK will be given a vote on whether to stay in or leave the EU. What do you think is likely to happen? Well, just what did happen. Those areas of the country feeling the greatest pain have voted to leave. Those areas of the country suitably blanketed from the hidden costs have voted to stay.

To steal from Stevie Smith, Remainers are waving the leavers are drowning. So what does this all mean? It means that we all have to re-assess the real benefits/costs of belonging to the EU. We certainly need to address the issue of free movement and we certainly need to revisit the revival of industries that traditionally lie at the heart of the UK.

If this means leaving the EU, then the short economic term pain will be worth it if the long term social benefit is to bring the disparity parts of the UK closer together again.

BTW, did you notice that I made no mention of the MPs or anyone involved in the political process?

Why? Because vested interest and party politics are driving their agendas. What I am citing here is what the people of this country need – not the politicians.

Sources – Nemo’s comment

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Household debt in UK ‘worse than at any time on record’

British household finances among most indebted in major western countries, ONS says

British households spent around £900 more on average than they received in income during 2017, pushing their finances into deficit for the first time since the credit boom of the 1980s.

The Office for National Statistics said the shortfall amounted to nearly £25bn – equal to almost a quarter of the NHS budget – and the overspend was mostly paid for with borrowed money, though households also ran down savings.

The figures pose a challenge to the government, which was warned last year that Britain’s consumer credit bubble of more than £200bn was unsustainable. A dramatic rise in debt-fuelled spending since 2016 has also taken place against the backdrop of the Brexit vote, which triggered a rise in inflation at a time of weak wage growth.

Analysts warned that a squeeze on household incomes from benefit cuts, lackluster wages, and high inflation would continue to force poorer households to borrow more to pay basic bills.

Tom Selby, a research analyst at financial adviser AJ Bell, said the figures presented ministers with a significant challenge as they sought “to build financial resilience in the UK”.

Researchers at the ONS said the situation was worse than at any time on record after the £25bn deficit last year surpassed the £300m deficit recorded in 1988. British household finances also slumped from being among the most solvent in the 1990s to being among the most indebted compared with households in other major western countries.

The report – titled “Making ends meet: are households living beyond their means?” – found that the deficit among UK households, equivalent to 1.2% of GDP, contrasted with a surplus in France equivalent to 2.7% of GDP and a surplus equivalent to 5.1% in Germany.

Last year official data showed unsecured credit – such as credit cards and payday loans – climbed to a record high of more than £205bn while the consultancy PwC said its own measure showed consumer debts rising above £300bn.

The ONS said households took out nearly £80bn in loans in 2017, the most in a decade. But they deposited just £37bn with UK banks, the least since 2011. Households accumulated more debt than they acquired in assets even when their investments in bonds, shares, and pensions were included.

Anti-poverty charities warned that millions of low-income households were the worst affected.

StepChange, which provides advice for indebted households, said the poorest were in constant need of credit to keep their heads above water.

The charity’s chief executive, Phil Andrew, criticised the ONS for saying that households were living beyond their means, which he said implied they could cut back if they wanted to.

“It’s really unfortunate that this very useful data is so heavily sprinkled with the phrase that households are ‘living beyond their means’. The reality is that too many households, here in Britain, in 2018, simply cannot make ends meet, however hard they try.”

He added: “Not having enough money to make ends meet is not the same thing as living beyond your means – which implies you have a choice when too many people do not.”

According to ONS figures, the poorest 10% of households spent two and a half times their disposable income, on average, in the financial year ending 2017 – while the richest 10% spent less than half of their available income during the same period.

The ONS said a rise in interest rates, expected to be pushed through by the Bank of England next week, could encourage greater saving and an improvement in household finances.

But AJ Bell’s Selby said: “For people having to borrow to make ends meet, saving for the future might feel like a luxury they simply cannot afford.”


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Conjoint analysis-Why do customers buy

Conjoint analysis is an advanced market research technique that gets under the skin of how people make decisions and what they really value in products and services (it also known as Discrete Choice Estimation, or stated preference research). Conjoint analysis involves presenting people with choices and then analysing what were the drivers for those choices. The output from a conjoint analysis is a measurement of utility or value and is perfect for answering questions such as “Which should we do, build in more features, or bring our prices down?” or “Which of these changes will hurt our competitors most?” In addition, these utilities are used to build market models that enable forecasts to be made of what the market would choose given different product or service designs.

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Benefits of using a conjoint analysis:

  1. It’s an efficient way to assess customers’ relative preference for product features.
  2. It can be used for customer segmentation.
  3. It can be used in product development.
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9 Factors that Affect a Customer’s Willingness to Pay

Willingness to pay (WTP) is the maximum amount an individual is willing to hand over to procure a product or service. The price of the transaction will thus be at a point somewhere between a buyer’s willingness to pay and a seller’s willingness to accept.

If a company understood customer willingness-to-pay before any negotiations commenced, they could develop strategies to realise that price during the negotiation. Salespeople rely on their experience and selling skills to draw out this information using historical data and value-based pricing methodologies to understand how a customer values their products.

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Buyers will be more willing to pay if they believe that a higher price signals higher quality.


If the buyer values the unique attributes of your product they will be more willing to make a purchase. In a nutshell, they value your product above others in the marketplace.


Buyers are less willing to buy an item the higher the total expenditure, both in pounds and pence terms and as a percentage of their income and/or budget.


Several pricing studies have found that customer characteristics may influence WTP. These differences in WTP may depend on demographic, psychographic, or behavioral characteristics.

The demographic variables include age, sex, race, income, marital status, education, and geographical location as well as psychographic variables such as activities, interests, opinions, and lifestyle.


Macro-environmental factors such as the overall state of the economy could influence customer willingness to pay. For example, in a downturn in the economy, the customer’s willingness to pay may be lower as compared to a period when the economy is booming.


Fashions increase the demand for certain products and services and consequently increase the customer willingness to pay for those products.


If the customer perceives the price to be fair in comparison to similar products on the market they will be more inclined to buy.


If the buyer perceives that the current price is temporarily lower or higher than it will be in the future this will influence the timing of their purchase.


Or, 3 for 2 effects etc. The buyer wants a bargain of course, to believe they are getting something for nothing. They are statistically less likely to buy a single item than a ‘bundle’ of items.

By Moira McCormick