Hot and Cold

26:48Plenty more from Jane and Sophie in the second half of the programme. We're going to talk about the impact of, well, more of England being officially in drought, what that's going to do to farmers, what it's doing as well to people who produce ice. Ice is going to hospitality and retail venues and we'll also chat about why Jeff Bezos, the founder of Amazon, wants a slice it seems of Liverpool Football Club. Pop quiz. What's in your kid's lunchbox? At Whole Foods Market, they've already done the studying. Over 300 food ingredients are banned from their shelves. No hydronated fats in the peanut butter and no high fructose corn syrup in the cookies.

27:27And for sandwiches, there are no synthetic nitrates or nitrites in any of their deli meat. So you can pack lunchboxes with peace of mind. Get back to school ready at Whole Foods Market. Wake Up To Money with Will Bain. Morning, welcome back to Wake Up To Money on Tuesday, the 11th of August, where our panel this morning are Sophie Millican, the founder and chief exec of the Newcastle-based PR company Moja, and Jane Sydenham, Senior Investment Director at Rathbones. 85058 for your texts. We've got some saved up for when we're going to talk the high street in a bit. 08085 99693 on the WhatsApp if you want to get in touch with us that way.

28:07Well, we're heading into our fifth heat wave of the year, as we were just mentioning in the news, or I was trying to beat the tongue twister about heat health alerts in there. Drought officials have declared 71 % of England now in drought. driest July since records began in 1836. The East Midlands, Lincolnshire, Northamptonshire, Kent, Sussex, Solent and the South Downs moved into drought status on Monday joining half of England and the whole of Wales. The National Drought Group, which is made up of regulators, government officials, water companies and agriculture bodies made the decision after meeting on Monday.

28:42It means a total of 45 million people across the country are now living in a drought area, more than 27 million facing water. use restrictions, obviously having a massive impact on food production, big impact too on the ice industry as well. And we're joined by two people who know that better than most at the moment. Claire Eckley joins us. Claire runs Eckley Arable Farms in Kent, growing wheat and other crops. And Nick Brennan is also with us. Nick is the sales director at the Ice Company, supplies the majority of ice in the UK. And he is with us as well. Morning both. Claire, first of all. So were you, you now move into drought, right, in Kent as of today?

29:22Or were you already in there already in your region? I think we moved in yesterday, so we were not quite in drought status before Monday. But yeah, very hot, very dry. We didn't have any rain in July at all here on our farm. Not a drop. What impact has that had practically? Can you explain what decisions it means you have to make on the farm? Well, in July, we had already, you know, that was, you know, the lack of rain in July didn't really affect our crops. They were already suffering from lack of water in May and June. But it has meant that we brought harvest forward as about 18 days for us.

30:02I think other farmers, it might have been three weeks, three and a half weeks. So harvest is finished and it's our earliest finish ever. Practically, what does that mean? So practically, we had less for us. We had less time to prepare for harvest. So we suddenly, you know, I came home from choir on a Saturday morning and I found my husband in the field with a combine and there was only me and him on the farm that day. And I got a little phone call saying, do you want to come on grain card? but yeah so had to rush to clean the stores rush to get the machinery ready and off we went so short of sending up the bat signal though does it do anything practically in terms of how how much you sort of get in return how big the the crop is yes so we've what we've found is some of those grains in our in the ears did not puff up as much and that was due to lack of water So we've got some shriveled grains, so we've probably been hit by about 10 % to 15 % yield loss.

31:05But for other farmers, they're reporting up to 30 % yield loss. So it depends what kind of soil you have, what kind of crop husbandry techniques you use. And so down the track, what might that mean for our listeners in terms of, I guess, prices in particular? Well, we've seen a spike. So last year we were selling wheat for about£170 a tonne. This year it's looking like about£200 a tonne. But, of course, wheat forms such a tiny part of the cost of your loaf of bread. I wouldn't really expect to see much increase in the price of a loaf in the shops. No, but I suppose it's this picture across the board, right?

31:44If there's lots of things going up by that amount, because I presume colleagues farming other products are in a similar boat. Yeah, so we are in a really mixed agriculture area. We've got apple growers near us, strawberry growers, raspberry growers, and they're very much, they're very reliant on irrigation and water. So they'll be monitoring their crops really closely. So yeah, water security is food security. So yeah, water is really impacted on what we do. And Jane, Sydney, actually something that Andrew Bailey and the Bank of England were talking about when they were talking about interest rate policy, wasn't it?

32:24This was one of the sort of the outliers that they couldn't work out how much impact or not impact it may have on inflation in the second half of the year. Yes, yeah, definitely. And, you know, the more constrained those supplies are, you know, the more prices will go up. But of course, also, I mean, one of the options we do have, which isn't great, is being able to import more food. But otherwise, yes, it's going to push up prices and then that puts pressure on inflation. Nick, tell people a little bit about the ice company, first of all. Morning, Will. Morning. Morning. Yeah, we manufacture pre-packaged ice, the kind of bags of ice that you'll buy, everything from a supermarket to bars, restaurants, cafes, events and festivals around the UK.

33:08And what's the picture at the moment then? The picture is busy at the moment. Yeah, I bet. To put it bluntly, hence, yeah, for us, it's all about forecasting and planning when we run any kind of a seasonal business like this. So we always plan for a good summer. But even for us, this summer has surpassed anybody's expectations. So it's just busy. I was going to say, and I've been reading in some places that some of you are presuming your competitors, your colleagues in the industry, been finding it difficult to manage that kind of demand and that supply chain. We've been hearing kind of about shortages in bars and places like that, pockets around the country.

33:49How much of a problem has that been? Yes, it does tend to be. It's a constant challenge because it's one thing being able to manufacture the ice, for example, in our factory, put it in our warehouse. but it's making sure the ice gets all through the supply chain. So if you are a bar or a restaurant, a coffee shop, for example, might say, you know, right, I'm going to sell 100 iced coffees today. If the weather's a bit hotter, they might sell 150. Now, so it's constantly predicting that demand, so they may run out at a certain point and have to kind of pick up additional ice during the day, etc.

34:23And is that demand then affecting price at all yet? No, for us, we will actually just set our prices for the year and we just kind of run it through the year. So we will commit to a price all year. So how stressful is it trying to ship large bags of ice around in a wave? Less stressful because this is what we're built for and we do work in really good partnership with all the wholesalers, retailers around the country. It's just lots and lots of conversations, making sure that everyone is aware and we're working in partnership to make sure the ice gets to where it's needed. Yeah, and then when it gets there, I know this isn't your bit of the supply chain, but we've also heard, I was in a supermarket yesterday where the fridges and freezers had succumbed to the heat, that being a little bit of a problem as well this summer.

35:12Yeah, that is unfortunately a problem with when most freezers are designed to operate at high 20s, 30 degree temperatures. So it gets above that, they start to break in the supermarkets. Wow. Yeah. And Claire, so what happens now, now that you've done all the hard work that you would normally have to cram in, what are you doing? Got the feet up, having some ice drinks? Well, we did actually manage to go away for the weekend, which is unheard of. But, yeah, we were talking about that. So we had damage to the fields in the wet weather in the winter, so we've now got some extra time to fix that before we replant crops in October.

35:50So, obviously, a lot of serious elements of this, but nice to hear that there was one silver lining, if you like, like one positive in terms of you and your husband to skate there, Claire, as well. Thanks so much for speaking to us this morning. Really appreciate it. Thank you. Good luck with that. Claire Eckley, though, runs Eckley Arable Farms in Kent. And Nick, thanks so much as well. Where are you off to? Where's the next shipment heading off to? Everywhere all over the country. I think I've got about 100 shipments going out today. So, yeah, keeping us busy. Good luck as well. A busy few days, it sounds like, with the temperatures wrapping up as well.

36:20Nick Brennan there, the sales director at the Ice Company, supplies us. when it was explained in the majority of the ice right around the UK. There's a mad supply chain that you never thought you would end up focusing on, Sophie, the supply of ice for ice lattes and ice matches and all that sort of stuff. Absolutely. I've just got visions of what this factory looks like. It's just the hugest freezers and all sorts. And people kitted out presumably for that as well. I mean, the serious side of it, Jane, as well there, it's just like every little bit, right? I hear what Claire was saying in terms of not having a big impact on the price of your loaf, but every little bit when it adds up could have this drought potentially some economic consequences, couldn't it?

37:05Yes. I mean, anything that disrupts the supply, that reduces the amount that you're able to sell means that the market becomes tighter and prices go up and it has an impact on inflation. And whether it's more electricity demand in the summer, pushing up energy prices, I mean, there's all kinds of effects, as you say. The more you think about it, the more you realise the knock-on effects are everywhere you look. It also apparently has a big impact on whether we go out and about spending as well, or certainly shopping, retail spending, because we've got a couple of bits and bobs of data from that out today.

37:42The British Retail Consortium, the kind of sort of biggest, most comprehensive of that, again, Jay, and they're kind of flagging that really, saying, one, they had a particularly strong month last month, retailers, because of the sort of extra spending around the World Cup, but that this heat wave is actually seeing spending dampened quite considerably on a year ago. So the previous July, for example. Yes. Yeah. I mean, people won't go out if the temperature is too high. You know, if they want to go and buy something, they just kind of say, you know, I just can't face it. So it does have an impact if you're selling sort of bigger goods or more expensive items where people actually need to physically go and see them.

38:21You know, they're just not getting the footfall that they normally would because of the heat. So it also affects sales on the downward slope, too. Sophie do you think you see it kind of just sort of around you Newcastle city centre does it ease off when it's been at the real kind of peaks of crazy hot this summer we don't get crazy hot here I listen to all everyone's stories there and I'm like oh we've had rain for the last week so it's it's definitely a different climate as someone that lives in the northeast but travels to London a lot I can tell you there's a huge huge difference so we don't see it in the same way but you know as soon as it's a bit sunny here everyone's kind of in the summer gear and and loving it but it is it's really not that hot.

39:04Full steep ahead to Time Mouth and Whitley Bay and everywhere else like that. What about the consumer sort of confidence side of it because that's the other bit of data we've had out this morning Sophie the Barclay card numbers that that is showing because of a glimmer of light that people well I don't know whether it's a glimmer of light people seem to be spending a bit more whether that's just because things have got more expensive but you were talking about this right at the top of the program are you seeing a little bit more confidence in um how people are feeling about i guess at the level you're dealing with their budgets as businesses but also perhaps just that consumer spend too i think it's a weird one because as i said at the start i'm i'm an optimist and i hang out with lots of uh fellow optimists but it is a bit it is it's tough and i feel like i'm always saying that every every time i'm on this show like it is tough because we've still got so much uncertainty you know the the news every day there's sort of another another curveball but I think when you particularly when you run a business you have to be an optimist and stay focused on on what you can control and I guess as a consumer you know we we still want to go and have some some treats you know me and my partner go out for for dinner quite a lot I mean every time we do that we say we really should stop going out for dinner so much.

40:15I know that being a conversation. Yeah, health reasons as well as how much it costs because it's expensive. But, you know, we all need to have something to look forward to, don't we? Whether that's a little treat or, you know, buying something that we've had our eye on or whatever. Jane, was there any of a theme from the sort of stock market listed retailers in terms of confidence? I'm trying to think of the ones that I looked through in detail. Tough kind of trading period was kind of the sort of sum up, I think, from the from the supermarkets, wasn't it? Yes, yes, it was. I mean, you know, confidence has been, as you said, a little bit better because of the World Cup.

40:50But I think the underlying thing that's worrying everybody is this rise in energy prices because of what's going on in the Gulf. And of course, again, that affects absolutely everything because everything involves the use of energy. So there's this underlying concern, even though in the short term, actually spending's been okay. So it's a bit of a mixed picture really at this point. Yeah, and one of those flagging tough trading, not in their results, but actually with their in-house magazine of all places, was John Lewis. And we've got a change at the top there, Jane, as well. Peter Lewis leaving.

41:27Yes, after about just under three years talking about really tough trading conditions. I mean, interesting because John Lewis paid its partners their first bonus in four years back in March. And partners is everybody who works in all of their stores, by the way, if people aren't kind of aware of that. Everybody who works at John Lewis is a partner, aren't they? They are. They are. There's about 70 ,000 people that are included in that. But again, you know, the war in Iran sort of happened, I guess, started at the end of February, pushed up energy prices, confidence has sort of been a bit weaker since then.

42:07So again, you know, it's a tough environment, but he seems to be going off to do something else. So whether or not he's had another offer, or whether it's just pure trading, it's difficult to know at this point. Yes, he did say, didn't he, that he was looking at other opportunities and he had had a couple of goes at the company as well. They strike me as being an interesting, I don't know what you guys both think, they strike me as being an interesting place in the market. Jane as well, that sort of have a lot of things that are nice to have rather than essential, if that makes sense, at a time when we're talking about people's budgets being really tight.

42:41Yeah, and I think it's brands as well. I mean, one of the sort of the kind of leading beacon success story in the UK, of course, is Next, which has been very clever about acquiring different brands and really focusing on the strength of those. John Lewis, of course, has got a lot of its own label goods, struggling for those to stand out against the rest of the marketplace. So it's kind of a, it's in a difficult place for sure. What do you reckon, Sophie? Well, I used to work for John Lewis for about 12 years in my 20s and into my early 30s. So this is a really interesting story for me. And I've got really fond memories of John Lewis.

43:21In fact, someone that I worked with 20 years ago is coming up from London to stay with me for the next few days. so I've got very fond memories but I think it feels different as a place to shop now so I'm still very loyal to John Lewis and I think they've done well probably particularly with Peter Rewis in terms of getting some cooler brands so getting Topshop into stores I think was a really big win but it does feel different as a place to shop and I think as a place to work because all the things that made that business unique, they've slowly been going because they're the things that cost money that don't necessarily bring in revenue.

43:59Why don't you take those in turn? Give us the inside first and then from the store perspective as you see it. But as a place to work, what's shifted, do you feel? So they used to have the in-store magazine for every single branch as well as the partnership. I mean, that's a luxury, isn't it? But I love that. It was so fun. they had in-house learning and development teams in every single store again these are things that have been regionalized and centralized so I think that kind of character and that huge emphasis on learning and development has has gone and as a shopper now going through they used to have very very high standards around business dress is what we called it the uniforms now I think staff are allowed to partners are allowed to wear whatever they like so I find it quite hard to actually spot who the staff are now.

44:50So I get why they've done some of these things, but I don't know, I feel like they've lost a bit of the character, which I think is sad to see. Jane, that's interesting, isn't it? How you sort of balance those two things, I suppose, cutting some of the things that are more expensive in a business when things are not going brilliantly, but losing sight of who you are a little bit. Yes. And I think, you know, one of the things that's really difficult is with the competition from internet or online retailing, you need to have an identity. And when people walk into a store, they've really got to see what that is.

45:25But that does cost money. You know, it's striking a balance between those two things. I mean, John Lewis was always known for its service and its staff and so on. And that's become really expensive and difficult to deliver at a time when, you know, internet retailers are sort of undercutting them, really. And yet, if you're going to stand out and also if you're going to drag people away from their laptop, iPad, phone or whatever, it's got to have a bit of a reason, right? It's got to be an experience. It's got to have good people on the shop floor, for example. Yes. I mean, you know, I think they do need to really think about that.

46:01And you've got to have a focus as a business and a character. When people need to know when they walk in that store, this is what I'm going to see. This is how it works. and maybe they should be focusing more on service again because that's what is quite hard to find these days. So maybe that should be their focus, but they need to decide on that. And Sophie, does that have to be expensive? No, I don't think it does. I don't think it does. I think a lot of that is around how you recruit people and what you're looking for in your recruitment process. I think you can do very inexpensive training in terms of coaching, on the job coaching, feedback, things like that.

46:43So no, it doesn't have to be. I think they now do less of product knowledge training and more formal courses, which maybe is a sign of the times more generally. But yeah, there's definitely low cost ways that you can get that right. And it's just setting standards as well, isn't it? Well, it's like, isn't it? It's, you know, whole floors of electronics or whatever. If you go in there and the people are as disinterested in you and don't know anything about the products as anywhere else. You might as well do the research yourself with our pal, the AI agent, when it's finished rebooking all the people back into the class again, right?

47:18Exactly, exactly. So this is where they can really stand out by offering exceptional service. And back in the day, they were always top of that witch chart. I don't know if that still exists. That was the big thing then. They were always number one or number two. It would be really interesting to see where they stand now in charts like that. And from a shopping experience then, because I think that brings us right around kind of neatly to where we started in this story in the news about retail more generally, I suppose, and boosting high streets again, which is in the news this morning, of course, this Andy Burnham pledge around the sort of beginnings of that.

47:51What have you seen that's changed in the shops and the shopping experience itself then, Sophie? At John Lewis? Yeah, sorry, at John Lewis specifically. I think you see less staff, but I think part of that is you can't work out who the staff are because of this new uniform policy. So I think that is tough. And I think what you do see, though, a bit more of, which I love, is more of this experience stuff. And I think that is what gets people into shops. So you're seeing sort of pop-up experiences or sometimes like fashion shows or an expert being in. I love all of that kind of stuff because that is what feels different if you were just having to browse online and buying it from somewhere else or even buying it from the same place.

48:37So more of that, I think, to get people into the shops and create that buzz because that's what you want to feel. You don't want it to be really busy when you're shopping, but equally you want it to feel different and more of an experience than that online side. Yeah, interesting. And keeping that, I suppose, with that extra choice that James is talking about, next have absolutely led the way in that, haven't they? Sort of becoming sort of almost department stores in a way. But this text that's come in from Maria Jane, quite interesting. Stop shopping at Next. Too much choice. Takes ages to look and end up keeping nothing.

49:12Close my account a year ago. Husband was surprised they didn't see a profit. That is quite interesting whether there's a balance there or not. Yeah. No, no, I think it is. I mean, it's a bit like going to a really, I remember in the past, going to a really big department store and thinking, oh, this place is so big, I can't make a choice. So it is about that focus and being clear when you walk into the store, this is what I'm going to get. this is what this store is good at this is how it functions so i know where to go so i guess you know you know that that's it isn't it is clarity about what your business stands for whether it's service or choice or events or whatever it happens to be but it's being really clear um and that's the challenge for retailers now is fixing themselves in their customers minds yeah it's going to be very interesting going forward with the the new boss there and newish boss at Waitrose as well.

50:01So big change across that partnership there as well. 85058 in the last couple of minutes if you want to get your thoughts in on that. But there's more reports this morning that a consortium of investors, including the founder of Amazon, Jeff Bezos, is getting closer to buying a significant minority stake in Liverpool FC. Andres Martinez is the author of The Great Game, A Tale of Two Footballs and America's Quest to Conquer Global Sports. Stayed up very late to speak to us. Morning from us. Good morning. The second half of your book's title. Is this another step then in that quest to conquer global sport?

50:37I mean, historically, the United States was a world apart when it came to sport, right? We invented our own games to reinforce our insularity. And now we have the convergence where we're becoming part of the world football scene. And yes, I mean, if you look at this past season, In the Premier League, for the first time, a majority of the clubs there were owned by Americans. So I do think that you're seeing the United States becoming a power in world sport, much like we've long been in film and music and other forms of popular culture. How much do you think, Andres, it looks a good investment, i.e.

51:16they think these businesses are undervalued? And how much of it is it about wanting a slice of kind of prestige, I suppose, that comes along with being a part owner of a Premier League football club? I mean, I think part of why this is so appealing is that it's both. You know, the amounts of money we're talking about for these major clubs in the Premier League and across Europe are staggering, but they still seem like a relatively good value when you compare it to what's happened in our domestic leagues. I was going to say, lots of people thought Jeff Bezos was going to, because of his Seattle links, look to buy the Seattle Seahawks, and yet he hasn't, and here he is looking to get involved in a UK football club.

52:01And the Seahawks just sold for about 50 % more than the valuation of Liverpool, and yet Liverpool has a global reach that the Seattle Seahawks will probably never have. so uh i do think it's it's it's seen as a good value the most primarily clubs lose money all nfl clubs make money i think these american business types say and maybe this is hubris right we're going to go in there and we're going to you know sort this out and run this more properly quote unquote and can you do that with just more profitable can you do that with just a 30 stake do you think can he be allowed enough voice but just because of who he is i suppose no i i think this is getting your his foot in the door right i don't think jeff bezos wakes up in the morning and says i want to be a passive investor in something as alluring as this so i think and we've seen this before right we've seen many current uh controlling interest holders start off with a with a smaller equity stake and then they'll from that they build from there or Or he'll learn about the Premier League and see other opportunities to acquire a different club.

53:08We've certainly seen that go in the past, haven't we? Andreas, really appreciate your time this morning. Andreas Martinez there. Big thanks to Sophie Millican and to Jane Sydenham as well, who've been our panel here this morning on Wake Up To Money. Wake Up To Money with Will Bain. 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 anytime as well on social media. Use the hashtag WakeUpToMoney. This goes beyond what the KGB did back in the days.

53:44Conspiracy theories and the Football World Cup. Is there ever one without the other? Well, I've been digging into one of the very best back in 1994. Guy from Iraq gets a red card for a dubious tackle. I'm James Montague, and from BBC Five Live, this is Sports Strangers Crimes Presents Shadows on the Pitch. Listen on BBC Sounds.

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