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A bid by the government to kick-start the economy with a 2.5 per cent cut to shopping taxes seems to have started paying off in the home improvement sector.

Last Monday Chancellor Alistair Darling announced the VAT cut in his pre-Budget report in a bid to encourage consumers to spend more and boost the economy.

And it seems that the tactic may be working. While sales are still broadly down on this period last year, they are well up on last month, as would be expected with Christmas approaching and the economy functioning normally.

Department store John Lewis, which trades extensively in homewares, has reported improved Christmas trading and a record week for online shopping.

Elsewhere Marks & Spencer, another retailer with a big homeware department and a dual presence on the high street and online, has been holding 20 per cent off sales.

It has kept many stores open until midnight to tempt customers into taking advantage of special offers.

Elsewhere, Debenhams has dramatically cut prices while administrators for Woolworths reduced some prices last week by up to 50 per cent.

One casualty of the looming recession has been furniture retailer MFI which was forced to call in administrators in October.

And Kingfisher, Europe’s largest home-improvement retailer and owner of B&Q, has reported a decline in its third-quarter UK sales.

The company warned that consumer confidence had been shaken across all its markets.

One of the UK’s largest DIY businesses has appointed a new boss – and it’s someone close to home.

Kingfisher Plc, the DIY giant that owns B&Q, Screwfix and Trade Depot, has appointed Ian Cheshire as its chief executive officer.

Formerly the chief Executive of B&Q, he starts his new job with its parent company today.

This follows the announcement on November 1 2007 that Gerry Murphy was to stand down after five years in the job.

The new CEO’s job will include the task of reversing a sales decline at B&Q, currently the UK’s largest home improvements chain.

Since he took the reins at the company, he has instigated big changes there.

Kingfisher says that a third of B&Q’s large stores are now trading successfully in a modern format and more than 60 per cent of product ranges have been renewed.

It says Mr Cheshire “will continue to work closely with the B&Q management team to ensure the momentum behind its renewal programme continues.”

The company has now started a search for a new managing director for that company.

We all like things to stay familiar – which has a lot to do with the success of the big High Street DIY chains.

Go into a store and you’ll find exactly what you’re used to, whether you’re in Aberdeen or Ashby de la Zouch, and often in approximately the same position.

But it’s looking like we may have to get used to a few changes.

According to this business article in the American publication Atlanta Journal-Constitution, the UK DIY market could be in for a degree of consolidation.

It is predicting that we could see the break-up of the powerful Kingfisher group, and B&Q being taken over by the major US chain Home Depot:

British chain could open door for Home Depot

Only five years ago, B&Q — the Home Depot of Britain — was riding high in a booming do-it-yourself market. With new chief executive Gerry Murphy at the helm of parent company Kingfisher, the B&Q chain’s profits were buoyed by a nation hooked on home makeover TV shows.

But after two years of decline in Britain’s troubled DIY market, Murphy is due to step down in February, and some analysts say the move could set the stage for an acquisition by Atlanta-based Home Depot, sending it into Europe for the first time.

The analysts believe that with Murphy gone, the Kingfisher group could break up, spinning off the core B&Q business and the chain’s operations in Asia and Russia, the Castorama DIY business in France, and a 21 percent stake in Hornbach, the leading DIY business in Germany.

Thanks to a slumping U.S. housing market, international operations have become key to Home Depot’s growth. Read full article here…