Coles' major cuts | Armaguard battle to keep cash around | Trump's tariffs upend markets

This is what the Flux. I'm Brett and I'm Justin and it's Wednesday, the fifth of February.

Josie Boy. We know the famous saying is time in the market as opposed to timing the market, but you still don't want to miss time the markets. Australian super invested five hundred million dollars into Nvidia in the three months to December twenty twenty four, just before in Video's seventeen percent crash following the release of Deep Seek AI.

Not ideal timing at all, but man, man, let me tell you what is good timing. Our latest academy for February Shifting your Money Mindset. This one is all about starting off the new year on a high by creating a positive money mindset because it is the foundation of financial success. We're talking about ditching limiting beliefs, boosting your confidence, and building a better relationship with money. So Flux down. Make sure to check out the Flux Academy in the fus out.

Three prizeworthy stories today, Josie Boy, Let's do it for our first. Coles is planning to aggressively reduce the number of products on its shelves to drive higher profits.

Sounds like Coles is doing a major cleanup on Aisle five B man, So what is the story here?

Well, juzziboy, we know that Coles is the second largest supermarket chain in Australia behind Woollys.

And together they are a behemoth. They have sixty five percent share of the grocery market.

But for the last few months, Coles has been working with external consultants on a strategy to simplify its range.

And an man, let's be honest, Simplify is just a fancy term for cutting its range by ten percent.

And juzzy boy, why are they cutting their range?

Well, the theory goes like this, fewer products on the shelves equals more sales for the ones that actually remain on the shelf.

Reminds me a bit of the Alder model.

Yeah, stick to a smaller range, sell more of each item, and then Coles can negotiate better deals with each of the suppliers.

So what is the key learning here?

Product rationalization is when a retailer cuts down the number of products that it sells.

And these rationalizations are often positioned as a positive for customers.

By simplifying their offering, we're enhancing the customer experienced.

You know, we don't really need thirteen table salts, which is just adding to decision fatigue.

And be man Out has proven that a simple range with cheap prices can actually work. Yep.

Audi has around eighteen hundred items in their supermarkets compared to Coal's twenty thousand items. Be man the primary goal of a product rationalization is almost always to improve profitability. By reducing its range, coals can simplify the management of their warehouses and it also means they can negotiate better bulk pricing with suppliers. But as the way under the surface, it's also a way for coals to give a not so subtle hint to suppliers.

If you want to keep your products stocked on our shelves, you need to be more competitive on pricing.

And this allows coals to improve margins without directly threatening each individual supplier.

So it'll be interesting to see how the ah Triple See and the Senate look at this one. For our second story armor guard, the Aussie cash handling Company is in danger of collapsing once again, meaning coins and notes in Australia are under threat. He low sock draws and matrostash are popular once again, So tell me what's going on here.

So Armaguard was founded in nineteen thirty eight, back when cash was most certainly King Queen and also Jack.

Yeah, Armaguard specialized in transferring money from banks to ATMs, to retailers and back and forth.

And you don't want to mess with these cash handlers.

Nope, but Beman. Last year you may remember that a group of banks had to throw Armaguard a fifty million dollar lifeline just to keep them afloat.

And now less than twelve months later, Armaguard is back cap in hand asking for more help. The problem is cash isn't exactly King Queen or Jack anymore. Yep. Less cash in circulation means less need for cash services.

And Armaguard's revenue is drying up faster than a forgotten ATM receipt, and that's raising a major question.

If Australia's last big cash transporter folds, what happens to this cash economy?

So what is the key learning here?

Being a monopoly usually means you've got the market all to yourself, but if your industry is dying or dead, there isn't much room to move be Man, Armaguard is.

The last major player standing in the cash handle industry after it already acquired its rival cross a Goore in twenty twenty two, and that means it has no other potential companies to acquire or partner with and share costs and be man. With demand for cash handling services declining, their options are narrowing well.

Option one would be find a way to cut more costs or increase prices.

Which looks hard at this point yep. Option two, get another financial bailout from the banks.

Option three just completely shut down and say goodbye to money circulation in Australia.

In fact, be man. The RBA data shows that in twenty twenty two only thirteen percent of transactions were made in cash, and that was down.

From seventy percent in two thousand and seven. And if Armagard doesn't exist, the banks and RBA risk a complete collapse of our cash infrastructure.

So be man. Armagad survival isn't just a problem for Armaguard, but the broader banking system.

For our third and final story, Donald J. Trump has sent the share market into a spin after announcing the rollout of tariffs on goods from the US's top three trading partners.

Geez, these tariffs were saved by the belboe b man, So tell me what is going on here?

Well, as part of Trump's selection campaign, he had promised to stem the flow of illegal migration as well as drugs, and.

He targeted three countries in particular. We'd be talking Canada, We'd be talking Mexico and China as well, and Trump would be man that if they didn't tighten their borders and reduce the flow of drugs into the US, he would impose major tariffs twenty five percent tariffs on the goods from Mexico and Canada, ten percent tariff on goods

Trump has now agreed to pause these tariffs with Mexico and Canada for thirty days.

After they committed to putting ten thousand officers on the borders.

Crisis averted for now, but dazibait the trade war may still happen.

So what is the key learning here?

A trade war is like an economic hug of war where countries slap tariffs on each other's goods.

And for those playing at home, tariffs are taxes on imports.

You put a tax on our goods coming into your country, well will put even bigger tacks on your goods coming into our country.

And they man, this can grow and grow and grow until it gets out of hand.

Markets don't like uncertainty. So when Trump announced tariffs on China, Canada, and Mexico, investors well and truly panic.

And when these tariffs looked like they were going to be rolled out, we saw the US market fall by more than two.

Percent, Bitcoin fell by more than eight percent, and.

Even the ASX got hit with around fifty billion dollars wide.

And does it way. Over the past thirty years or so, many of the developed economies around the world have removed tariffs to basically encourage free trade between nations.

And the man. Although there's a temporary pause on these tariffs right now, Trump could be bringing back the tariffs and trade wars in a very big way. Fox Am, if you've ever said to yourself or your friend or your partner finances and not for me, I'm just not the finance person, then you need to start on the Flux Academy this month, which is all out shifting your money mindset. So check out the Academy which helps you ditch limiting beliefs and boost your confidence around money and