A Roaring Trade

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1:20Good morning. It is Wake Up To Money. It's Thursday morning, the 2nd of July. Thank you for being with us. 85058, your thoughts on all we are discussing. Please, I can see that Halifax is going to be no more as a brand, as a branch. May have been one of those places over the decades where you had your first savings account, your first mortgage, whatever it might be. But now Lloyds Banking Group, which Halifax has been a part of for a while, getting rid of that brand. Sam Smith's pubs as well. Samuel Smith's pubs. Are you familiar with those? If you've been keeping an eye on the budget of the decades, you might have been pushed towards one of those Samuel Smith pubs around the country.

2:02The owner of it, Humphrey Smith, died at the age of 81. What a phenomenal story that is about how that business has maintained its business models and tried to keep prices low with a fair few rules that come along the way with it. No mobile phones, no electronic devices, no social media at times in some of those pubs around the country as well. Might have been quite a stark contrast in some of the pubs yesterday evening where you could well have been watching the England game. 85058, give us a shout out for wherever you were watching. If you were, what the atmosphere was like, what the plans are for the days ahead.

2:41Is there anywhere that's hosting some kind of party in the middle of the night for Mexico against England as they come to the end of the weekend ahead? I've got Stacey Croft with us on the show this morning, manager at the Thomas Becket pub in Worthing in West Sussex. Stacey, very good morning to you. Good morning. Thanks for having me. How was yesterday afternoon evening, Stacey? Oh, it was brilliant. the atmosphere was amazing and it's probably the busiest game we've had yet as well I mean it was an ideal time everything sort of fell into place it was after school had finished it was well certainly for people with kids my age it was before the bedtime needed to be really thought about I guess was this as good as it might get for this period of the World Cup do you think?

3:34We're a family community-led pub, so we wanted the kids in. And we had two separate areas as well. So we had the bar area, which we said no kids. We wanted to keep the atmosphere the same in there. And we allowed them in the restaurant. But there was only two tables. The rest was all adults. But they loved it. They really enjoyed it. It's nice, isn't it? It takes me back to childhood when the kids are sort of welcomed into pubs and you're part of that more family atmosphere. There's always a room you're not allowed in, or there always was. You wonder what went on behind that door. What kind of fun are they having that I'm not allowed to have?

4:14But it's a bit of a change, isn't it? You wouldn't often see these days the pub for a big celebration being a place where you're saying, come and bring your kids as well. Yeah, no, we're encouraging it. I brought my son down and I also got some face paint as well. So we were face painting their faces. And if I'm honest, the adults had it more than the children. Of course, of course they did. And in terms of, you know, sales, spender, people coming along, were they having a jolly old time giving you some cash over the counter as well? Yeah, and especially having a five o 'clock game as well. I mean, everyone stayed after.

4:55Oh, nice. So the garden was half filled with people who were here for the England game and they were just enjoying themselves after, which was lovely to see. And we had nice weather. And of course, you know, with it being a Wednesday evening, Stacey, not necessarily the day of the week that people would consider doing that. Do you think, did you see any signs of potential new custom that might be there in the future weeks when there isn't a World Cup on? Yeah, we had loads of new faces for the door, which has been fantastic. So hopefully they'll come back after the tournament's finished. Are these a bit of a moment for you?

5:30Do you have to be on your game when you're seeing new faces, being in hospitality? It's not an easy game at the moment. Are you thinking, blimey, there's something in this that can make us think we can attract some new people? Yeah, definitely. We've really been on our game here. I said to my team as well, I said, offer them table service. I said, if you've got time to spare, go and see if they want any more drinks because they don't want to miss the match. So let's try and keep them going. Describe your setup that you've got at your pub. Okay, so I've got the bar area. Everyone's got tables. We didn't want anyone just standing or sitting without anywhere properly to sit.

6:13So they've all got reserved tables. And then in the restaurant area, it's exactly the same as well. And then the sound goes throughout the pub. so they're obviously both set at the same time so we're all in the moment together and we've got a pizza menu running as well so we've done two for 22 on our homemade pizzas and we sold out last night as well I mean this is all good news isn't it would you say it's been a successful World Cup for the business? Yeah definitely compared to the very first World Cup I worked here eight years ago this has been far from it and the last one was at Christmas time.

6:53That was really hard, Christmas and COVID. This one's been great. We'll have a Summer World Cup. Yeah, and even though the timings of a lot of the games aren't necessarily what people would think would be at sociable times, it's just about doing a job, is it? Yeah, we have had some interest in the 1am game, but for us, I don't think it's viable to do it. So I have made that decision not to show the 1am one, but we'll be showing everyone after that for sure. How does it work license-wise if all of a sudden you thought, well, actually, if you decided on a Wednesday night, a Thursday morning, we were going to show it, is that straightforward?

7:31I found it quite confusing. See, they ask you to apply for a TENS, so a temporary events notice, but when you're in the knockout stages, you don't need it because they extend your licensing hours by a couple of hours. But it was all very confusing. So I have the licence for Sunday, but I've just decided against it. Yeah. What was the thing that really made you think, you know, it's probably not worth all of that effort trying to get the game on for one o 'clock in the morning? It's just making sure we make the money from it. So I need the guarantee that people are going to be drinking during the game.

8:12How many people am I going to get through the door? Will they be happy if I do tickets? how many staff am I going to have am I going to need three because I need extra with it being quite late at night and then if I do food that's another member of staff are people going to eat at that time there's so much to consider so yeah I think understandably I'll be fascinated to know 85058 if anybody knows that their local is opening up for a one o 'clock kick off because you have to take into a cake could go to extra time and penalties It could be a real all-nighter, Stacey, and then people are going into their Monday mornings and having to crack on with their working week, kids for school, whatever that might be.

9:00Yeah, it's a real tricky one. Really, I'm intrigued to know if anybody already knows of somewhere where they're heading out on Sunday night for that. We've got Sunil Krishnan with us this morning as well. our investor on the show, head of multi-asset at Aviva Investors. Zidil, good morning. Morning, Sean. Getting into it. Did you enjoy yesterday evening? It was a nice time. Enjoy. It was a good result. Yeah. Is that the word? Is that the right word? I mean, they don't make it easy, but it was the right word. I have to say, I was watching it at home, and we were going through different emotional states.

9:41I think for me, I felt confident they would equalize. I wasn't so sure how things would go after that, but I thought we would get on the score sheet. Yeah, there was a notable difference in the various WhatsApp groups. Some just convinced England were going to be coming back and doing this and others already giving the analysis of, as you're hearing the headlines this morning, of England's worst defeat for however many years. So, yeah, it can go both ways. Have you got a plan yet for Sunday night, if one at all, Sunil? No, no plan. We'll go with the flow, which probably means I'll end up watching it at home and try not to annoy everybody else.

10:19It's tricky going with the flow, though, isn't it? When it's a one o 'clock kickoff, are you thinking try and get a little bit of sleep beforehand on Sunday evening? Or is it just, you know, stay up, see it through and just take Monday for whatever it is? No, I think my employers might look askance at that. So there will have to be a bit of planning in terms of how we manage the sleep. That's probably the bit that can't be done on the spot where you end up watching it. Well, there's maybe more flexibility on that. Yeah, there's going to have to be a bit of an early night, I think, on Sunday evening and then see how we go.

10:57Interesting question for employers, though, isn't it, Sonil? Because we often talk about, you know, there's a bit of chat about this five o 'clock one, although it feels like times have changed a little bit with the five o 'clock kickoff in the evening flexibility. but are employers going to allow people off work to watch the game? What's the plan around that? With this one, do you think there might be bosses around the country sort of having to maybe just accept that for a lot of people, Monday morning might be a little bit groggier and actually just get ahead of it and say, look, come in a little bit later, just get your sleep and then we'd rather have you on full form for a few less hours?

11:37I would hope that something we've learned from the pandemic and working from home is that there's nothing more damaging to how a team works than people pretending to be at their best when they're not. So I would hope that what we can do and maybe learn a bit from the last few years is let's not have the hypocrisy. If managers are relaxed about people starting work a bit later, then they should make that clear beforehand and not just on the morning telling people, look, you're clearly not ready, clock off. So I think it is very important that managers just think a little bit in advance about how do they really feel about this?

12:12What's right for the team? And then just make sure that everybody has a clear view about that on Friday evening. Come on, bosses, get in touch with us. 85058 managers, are you already thinking, right, this is what I'm going to say to my employees for what they need to think about Sunday night into Monday morning? Stacey, are you normally open on a Monday? We are, yeah. So in some senses, would you be thinking, I mean, even if you're not open for the game, that actually a lot of your staff, those expected to be in early, I'm sure as manager of the pub, you know, you're up at the crack of dawn, just always cracking on with the next day, that expectations might need to be managed for Monday's day at work?

12:56Yeah, I mean, we're not sharing the game anyway, but if we were sharing the game, I would. Or even if you weren't, I'm just thinking, oh, your staff might be at home watching it. You might want to watch it. And then everybody's a little more tired on Monday. Yeah, yeah. I haven't really thought about who's going to be watching it at one yet. I'll have to ask them. Yeah, I know. You want to get those right on form. If there's anyone amongst them who aren't that much of an England football fan, I think they're the ones you want on shift early on Monday. They're the ones starting at eight o 'clock.

13:28Yeah, I don't know if that's in people's contracts or not. But, yeah, interesting one for bosses around the country to have to think about. 85058, do let me know your thoughts. Kirsty and Coventry's been into it the same morning, spent the night in our local, three adults, five children. Great atmosphere during the match. It's great to hear this. Kids in pubs and a community atmosphere, as we've heard from Stacey's pub as well. Afterwards, out in the pub garden where there was a kids' football net. Oh, this story takes a turn. Kirsty says, unfortunately, the landlady took umbrage at the kids playing football.

14:00very rudely asked them to stop. Seems a strange decision, so we left, and given the rude attitude, will not return, not name in the pub, but wish this lady was our landlady. You wouldn't have had a go at kids in the beer garden for kicking a football about with Annette, would you, Stacey? No, definitely not, because that would be my son doing that. Exactly. But I also think that's part of life's learnings, to be told off as a kid by a landlady for, you know, just doing something in the pub environment that you shouldn't be, that you think you can be doing as if you're down your local park. So, Kirsty, it's all life lessons, but great to hear that you at least enjoyed the game.

14:3685058, your plans for Sunday night. What have you got lined up, Kirsty, with kids as well? Kids, adults, are you all staying up, sending them off to bed? Whatever it might be. Sunil, changing tack, wanted to ask you about Halifax brand being scrapped after 173 years. Now, for those that might remember TV adverts over the decades, Halifax has really pitched itself as trying to be a bit of a brand of the people, the standard household. It might be where you get your first mortgage or have your first savings account as a kid growing up. But Lloyd's Banking Group now, which has had the Halifax brand under its watch since the financial crisis back in 2009, getting rid of the brand.

15:25They say no job cuts around that and there's no lack of commitment to the Halifax area. But it's quite something to get rid of a name that really resonates in the financial services sector. I think what it reminds us about in banking is that there are two really strong forces at play. One is, you know, you're talking about the, if you like, the nostalgia of it. So I remember before Halifax was even a bank having a building society account set up there by my dad. So, yes, I'm that old. And these brands have to be very visible in the market. They have to be ones that we do remember the ads. They have to be the ones where historically we did see the presence on the high street and so on and then see it every day.

16:18And that was very important for them to remain successful and viable. But the other really important force is scale, effectively, in banking, which is it does cost even for a large entity like Lloyd's to maintain multiple brands. There are parts you can't share in terms of the marketing budgets and indeed the branch presence, maybe places where there is a Lloyd's and a Halifax. And so over time, it's the scale that wins. And that's why we have not seen more and more familiar brands coming into the UK banking scene. In fact, it almost feels as though it's gone into reverse over the decades. When you say familiar brands, because what we have seen in recent years is a flurry of digital banking apps, banks themselves, Starling Monzo, JPMorgan Chase, Revolut in more recent times as well.

17:17Do you think that plays a little bit of a part in the difficulties for a very traditional brand like Halifax to survive? I think it certainly means that the parent Lloyds has to think very hard about how do we make ourselves as efficient as possible? How do we look at costs, perhaps with greater urgency than they would have to have done before? Now, it's not as though it's all great news for upstart challenges. We know from, for example, the challenges for a bank like Metro, that it's not as easy as just turn up and start to claim lots of the share of the incumbents. But I think certainly from a cost and profitability perspective, it does increase the urgency for those established players.

18:01Now elsewhere, talking about costs and profitability, Sunil, we often take a look at Associated British Foods as a business. It's got plenty of businesses within it that are of interest to people. So whether it's owning Primark, as it does at the moment, it's got food brands within it as well. Ravita, Twining's got sugar businesses in there. How did you reflect on its latest updates and what do you take from it? What's going on in the world at the moment? How customers are behaving? How costs are behaving?

18:38so i would say there were probably two important things that investors in general were looking for from this update one was uh there's been a lot of discussion of whether primark uh maybe spun out of abf so this idea of the conglomerate and and trying to find um opportunities to diversify your business across these different sectors maybe that uh doesn't have so much of a future for Primark? And then the other key question was just the operating performance of the businesses. And I think in that regard, the update probably wasn't that encouraging in the sense that to really unlock value, you'd have to feel that Primark was a business that had a strong prospect and a strong future.

19:24And I think in terms of its operating performance, things have improved a little bit in the UK, particularly in women's wear, but that's mostly been about discounting and price management, which is obviously a difficult way to keep growing the business. And then the other challenge is Primark has invested a lot of money in terms of trying to grow its European presence, but isn't quite seeing the results yet. So I think in that regard, it was probably not that encouraging for the idea that the spinoff approach would unlock a lot of hidden value in ABF. And that's probably why if you look at the response of analysts and and investors, it was perhaps a little bit underwhelmed.

20:01Now, back to some headlines in the pub world. Stacey, are you familiar? I don't know. You're in Worthing in West Sussex. Do you have Samuel Smith's pubs round by you? I know there's plenty down in London. Do they make it that far to West Sussex? No, there's none down here. Does his reputation, well, not just Samuel Smith, the founder of the brewery, but Humphrey Smith, the owner of Samuel Smith's brewing and pub business, who's died at the age of 81. Does the reputation of how those pubs have been run sort of, is that known across the wider pub industry? No, not really. No, not to me anyway. Well, have a listen to this because here's Mark Blacklock who wrote about the business for The Guardian and he was speaking to Radio 4's The World Tonight about why he described Humphrey Smith as Britain's strangest businessman.

20:53The business was opaque because in 1982 they made the extraordinary decision of making it an unlimited liability company, taking it essentially dark. That meant that the directors were personally liable for debts and losses. And so it meant it's always been impossible to really value what it's worth. So that's unusual. And then Mr. Smith's approach to managing the estate was unusually hands-on for someone of such high worth. Dictats would come down from the brewery, you know, a number of things, swearing was banned. At one stage, there was a crackdown on children, bikers were not welcome. There was a notorious incident in the John Snow in Soho, where two men were ejected for kissing.

21:44So there was a, you know, a very particular line of tradition, and we should we say traditional, very old-fashioned Christian morality that was coming down from HQ. So that's Humphrey Smith, who has died at the age of 81. That was Mark Blacklock, who wrote about Humphrey Smith and that Samuel Smith's business for The Guardian. Interesting how that plays into our conversation about what pubs are for and who pubs are for this morning, isn't it? And how that has changed so much over the decades. We've had lots of texts. John in Basingstown, for God's sake, he says, work is more important than football.

22:19No wonder in a mess. just watch the Sunday highlights on Catch Up. Another Dave from Thames saying, is the FA going to recompense me for my losses of the morning's work? No way are my staff getting a late start. It's a game of football, for goodness sake. So there we go. Maybe that's decision made in some parts. Now, do you remember this?

22:43Turning on a PlayStation 2, released in the year 2000. and in the following year, Sony, the company behind PlayStation, sold over 200 million physical game discs, but now it is fully abandoning that physical media. We heard about this idea when Grand Theft Auto 6 was announced saying the physical copy won't have a disc. Rhys Elliott, head of market analysis at the gaming data company Alinea Analytics. Am I pronouncing that correctly, Rhys? Yeah, you're getting that just about right, Sean. Go on, you correct me briefly. It's Alinea Analytics. Alinea Analytics, right. It's early, so it can't, you know.

23:22Yeah, let's not dwell too much. Let's get straight on to Rhys. No physical disc. We've spent lots of the last decade or so talking about vinyl, talking about CDs coming back, cassettes lately. Is this a bit of an error by the industry to just be getting rid of the physical copy altogether? I mean, error is kind of a strong word. I think the games market's in a different place to music and film. But what it's like ultimately about for PlayStation here is control, right? Like a disc can be resold or rented a hundred times. And Sony will only see revenue from just one of those transactions. You know, as you know, with discs, every resale and rental is value kind of flowing to the players and retailers instead of to the platform.

24:10So in this case, PlayStation. and without the discs then like that converts into like a full price a digital sale or it doesn't happen at all and both of those outcomes suit Sony really better than a thriving second hand market. What do you think that will do? How long will it take for that second hand market to really be impacted? Because we see shops on our high street functioning on business models based on secondhand games yeah exactly and i think the writing has been on the wall there for a while you know game has been in and out of administration cex is kind of on the back foot there so yeah i think it is really the beginning of the end for the the kind of brick and mortar specialist game stores sadly um but it will take a while to kind of kick in to answer your question sean because they're bringing this in in 2028 for new playstation games and obviously the stock for the older games still needs to kind of sell through to consumers very brief answer reese how many discs you got on your shelves at the moment at home uh way way way too many i don't even want to admit that publicly sean sorry maybe people like you have needed this uh this end to the physical disc reese elliott thank you from alinea analytics big thanks to stacy croft and sunil krishnan and to everybody who's been in touch about the game Sunday night last night.

25:35That's it from Wake Up To Money. Wake Up To Money from BBC Five Live. That's it from Wake Up To Money. You can download the podcast every Monday to Friday, so please make sure you subscribe. We'd also love it if you left us a review when you do. Get in touch. Keep the conversation going any time as well on social media. Use the hashtag WakeUpToMoney.

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