Business stories from the past week, compiled by Jason Maywald:
1) News.com.au: Soft drink makers pledge to cut sugar by 2025
Australia’s leading beverage companies including Coca-Cola and Pepsi have pledged to reduce the amount of sugary soft drinks they sell by 20 per cent by 2025.
The pledge echoes a similar pledge made by beverage companies in the US in 2014 to cut the number of beverage calories consumed per person by 20 per cent by 2025.
Like that pledge, Monday’s announcement by the Australian Beverages Council does not necessarily mean manufacturers will reduce the amount of sugar in specific drinks, but rather that they will increase the share of low- and no-sugar options sold.
“It’s measured by sales volume,” PepsiCo Australia and New Zealand chief executive Danny Celoni said.
“If required, reformulation is on the agenda, but I think for now standard Pepsi serves a role and consumers have a choice. Sixty per cent of our portfolio is already low- and no-sugar. In fact, Pepsi Max is already the number one no-sugar product in the marketplace.”
2) SMH.com.au: IGA in ‘convenience’ face lift as Metcash swings loss
Smaller IGAs will be given a facelift as grocery wholesaler Metcash tires to capitalise on consumer demand for convenience with a new “modern day” express offer which it hopes will help it return to growth in the face of crushing competition from Woolworths, Coles and Aldi.
“We have really good real estate out there but I would say our offer… could be significantly improved,” Metcash chief executive Jeff Adams said on Monday.
“So the opportunity will be to bring that up to a modern standard – more convenience foods, ready meals, ready to eat, ready to cook.”
Metcash has refurbished 325 IGA stores under its “diamond” store improvement program, including 75 in the past year, which resulted in an average improvement in sales of more than 10 per cent.
3) News.com.au: How Dyson almost killed a vacuum retailer
Much-loved vacuum chain Godfreys is in the fight of its life — and Dyson might just be the ultimate cause of its downfall.
For decades, iconic Aussie retailer Godfreys was the authority on vacuum cleaners.
But in recent years, the company has struggled in the face of online competition, new vacuum trends — and the rise and rise of Dyson, which has developed an almost cult-like following.
That is the opinion of local retail experts, who believe the failing company needs to innovate quickly if it is to reverse its ailing fortunes.
4) AFR.com.au: Commonwealth Bank insurance arm could fetch $1 billion
Commonwealth Bank’s general insurance unit could be worth about $1 billion, with analysts tipping the big domestic insurers could be buyers after the bank flagged the sale of the business.
The possible retreat from the industry came as CBA said it was planning an $8 billion demerger of its scandal-ridden wealth management assets, as CEO Matt Comyn refocuses Australia’s largest lender on its core loans business in Australia and New Zealand.
“As part of the strategic review of CommInsure General Insurance, CBA intends to explore the opportunity to further enhance its product and service offering to customers through a potential sale and partnership with a specialist insurance provider,” the bank said in a statement.
5) SMH.com.au: oOh! Media boss defends $570m spend on Adshel
Out-of-home marketing giant OohMedia chief executive Brendon Cook has shrugged off suggestions his winning $570 million bid for Here There & Everywhere’s outdoor advertising arm Adshel was too high, saying investors are positive about the acquisition.
HT&E’s share price jumped 8.1 per cent to $2.66 by close on Monday following reports Adshel had been bought by OohMedia after weeks of bids back and forth with rival APN Outdoor. OohMedia is currently in a trading halt due to the deal.
“I’ve met with 30-odd institutions today and they’re very positive,” Mr Cook told Fairfax Media.