Episode 56 Show Me the Money

south of the country. Now it's time for Show Me The Money

This is Show Me The Money, your weekly guide to who's making the

cash, how they're doing it, and what it means for the way we work.

With us tonight: The man who wishes it could be Christmas every day -

Andy Street is the boss of John Lewis. Financial journalist, Lucy

Tobin, wants Santa to bring her an all-in-one toast and egg maker - it

helps her get up early for her job at the London Evening Standard. And

Kevin Wood's entertainment company puts on panto across the country.

Oh yes he does! Christmas shopping - have you done

yours yet? The shopkeepers are hoping they can squeeze more cash

out of you this week. Some shops say they are enjoying record sales,

but the Shopkeepers' Trade Body has told the BBC tonight that there are

fewer shoppers this year than last year, when we were all snowed in by

the cold snap. How is Christmas the you? So far,

it has been very good. Better than we expected. Given how challenging

it is for many families, I am surprised. We finished with their

record week last week, 10% up from last year. Record week? You mean

more money than you have ever been in business? That is right. How you

able to do that? Firstly, we have a good online business. It is very

clear that people want to shop online, we are trying to make it

easy to shop online. The winning companies seem to be doing that.

Secondly, in these tough times, people have less money to spend, so

they are thinking carefully about where to spend it. Our commitment

about price, quality and service is cutting through. We have been

talking about the switch from High Street online three years. Is it

happening to a greater extent? Online is becoming as important as

the high street? It is not as important. For ours, four-fifths of

transactions will be in shops, and one fifth online. For the country

as a whole, it is 18 as a whole. Growth online is very substantial.

For -- it is one eighth. The winning companies will have the two

channels working hand-in-glove. British Retail Consortium telling

us that there are 5% fewer shoppers on the High Street when we were

snowed in. For them, it is a tough Christmas? Certainly, we will see

very few bright. This Christmas. We have all got less money. Energy

bills are higher, clothing and food costs more, next here is not

certain in terms of job prospects. When you are facing the prospect? -

-, what are you going to do? It is little surprise that retailers are

bearing the brunt. But isn't this the plan? If we do keep the budget,

we have less cash, and the retailers take a head. It exactly.

Retell has been enjoying a boom. -- Retail. We have got more shops

opening, and we are looking at more capacity. To -- do you have a

different perspective? Yes. What we are selling customers, tickets to

see pantomimes, is, well, we cannot pretend it is essential, but to --

but at least it is part of Christmas and tradition. Are they

spending? Oh yes. Our target was to have levelled figures, and we are

achieving that. But we have had to work harder.

Time for Boom Or Bust, our quick flick though the news you hoped you

had missed this week. This brings a whole new meaning to

"packing your trunk". A holiday camp for elephants has been set up

in southern India to help them cope with work-related stress. The

animals are attached to shrines and temples where they have a heavy

workload taking part in processions. To stop them saying goodbye to the

circus, they are given seven weeks of extra food, sensual massages,

and baths in special oils. People in Norway have run out of

something essential this Christmas - butter. It's being blamed in part

on the wet summer. That means less milk was produced. It's so bad,

Norway even had to relax its strict limits on imports so enough butter

could be bought in from abroad. Feeling flush? How about this loo

covered in those little crystal things? If you want to splash out,

it will cost you �100,000! And you'll have to go to Japan to buy

it as well. Let us start with the stress doubt

elephants. -- stressed out. Do we take stress seriously enough? The

boss of Lloyd's had to take his sick leave because of stress. Did

that change the way we look at stress in the workplace? I think it

has. The date Lloyds announced that, it was International Stress Dave. -

- stressed day. The City is taking it more seriously. The fact is,

there are few of us in the office, more people are being cut back, and

people in the office are working more. I think it will become a more

pressing issue. I saw something in the Times saying it is a wonder

more chief executives do not crack up. But there was not a lot of

sympathy for him, was there? In the industry, I think there was. How do

you deal with stress in your line of work? I get on with it. You just

have to do it. My line of work is a little bit strange, isn't it? We

spend all year preparing for a six- week period. The people who survive

in pantomime are people who can set levels, who know what level to work

out, in which month. Do you think stress is it necessary? Some people

are actually at their best when they have some of it. The bar to

that Norway is running out of, the business listened to draw from

that? -- the butter. One year, I was producing three productions of

Snow White, and I only had to 18 dwarfs! How many did you need?

So, in the end, we found an agency in Romania that flew in three. Of

course, they did not speak English! We have to somehow get round, and

we did. We send them back in the end afterwards. How long were you

sweating? A short time. There are many dwarfs in it eastern Europe.

There are few would walks in this country because of pre-natal care.

-- few word dwarfs. The crystal toilet. I can reassure you that

John Lewis will not start selling crystal toilets. Any range has to

have a premium at the top. But it acts like a ladder - you always

want to aspire to the top. So it is important that these luxury items

are there? Absolutely. You are getting married next year. Is it on

your wedding list? Know, but having perused the John Lewis store, they

do have a �89 toilet brush. -- no. We declined, however. You are not

doing your bit for the British High Street! Let us talk about the

advert. What was the thought process that led to that? Be in

these tough times, we wanted to have a thought about Christmas that

most people in the UK could relate to. It was relevant to them, it was

not something about the litter and obscurity. It was about their own

lives, and anyone will understand that. -- about the litter. You were

trying to tug every emotional heart string in the country, were due?

Let us be honest, every adverb is about selling products. -- every

advert is about selling products. We spent �6 million on advertising

every year. What rise in sales do you need to cover the cost of that?

If we think we will take sales this year of �3.5 billion, �6 million is

well in proportions. It is not on the high side, if you compare to

other retailers. Talking about famous slogans and captions, never

knowingly undersold, that has been the motto for John Lewis. What does

it mean in the modern world? Does that mean everything is cheaper?

means it is more relevant now than it has ever been. Customers'

budgets are stretched, and the motto is saying we will offer you

the best price on the High Street, you do not have to go round and

check it up, you can trust and we will have that best price. Hence

why we appear to be having a good performance this Christmas. What

about online? 12 months ago, we moved to extend that commitment to

websites of high street retailers as well as at -- as well as high

street shops. Why not just all high street? It is all High Street.

it is any website of any high street retailer. Our customers

understand but that is a different proposition. They do not have the

service infrastructure that goes with a traditional set up. Cannot

be sustained in the long term? You are facing competitors like Tesco's

and the big supermarkets, Dixons. They are all very competitive on

We have met those prices head-on and we do not intend to change.

Let's talk more about panto with Kevin Wood, the chief executive of

First Family Entertainment. This year, the man who bought -- brought

David Hasselhoff and Dame Edna Beveridge to the panto stage. How

do you explain to David Hasselhoff what panto is? I have been falling

his agent for seven years trying to get through, and finally a chick in

their arm work appeared. -- a chink in the Armagh appeared. -- armour.

I talked to his agent and said I wanted to speak to him face to face,

so I jumped on a plane. In my pocket was a three minute DVD on

the history of pantomime, because they thought pantomime was like

Marcel Marceau would you do not speak. -- where you do not speak. I

showed them the DVDs, and said, a new attempts it is a cross between

Disney and vaudeville. So they had that reference point. Then I told

them how much money they would earn. The wit came to cash in the end?

Yes, and they agreed. It was one of those wonderful meetings, I had a

contract in my pocket and they signed it there and then. You won't

tell me how much he is being paid, of course, but how do you cover the

costs of a big star like that, whose fee may be greater than the

entire rest of the cast? That is often the case. The Big Star often

earns more than the sum of every body of the other 40 people

employed in the show. How do you cover it and justify it?

justify it by the fact the star sells the tickets. The star pays

the wages. -- star pays the wages. If someone came steamy -- comes to

me and complains about someone earning more, I say, they are

paying your wages. I once did an experiment. It was the first time I

ever employed someone with a high fee, and I will tell you who it was,

she deserved every penny, it was Cilla Black. I took her to

Blackpool for an awful lot of money. I was standing in the auditorium

and I said, the money paid to cellar -- Cilla is up to row K. The

we have all the rest of the theatre for our show.

Banks have been ordered to ring- fence their investment sections

from their retail banking systems. They have been giving you has to do

this. They claim it will make banking more expensive. Do you buy

this? Do you feel it is an imposition, an additional cost too

much to bear and we consumers will end up paying it?

I think that is an argument we would expect, any industry seeing a

change may well complain to the maximum. Will be paid for it in the

long term? -- will we pay for it. We will have to wait and see, it

could be the end of free banking and current accounts.

This year has not been very good for banks, but in the past few

years we have seen profits that the tax payers, who have bailed out the

banks to that tune of billions over the past four years, are saying,

sort this out, look at this idea of ring-fencing the investment banks

and the retail banks and thinking that should be good for consumers

who now know what they get when they signed up to loans or savings.

We know that the banks hired a very expensive lobbyists to get the

Government to water down the proposals in the independent review

of banking. Was that lobbying successful? Did the Government

bent? The one major concession they want, and it is a major one, the

sense of liability will have to come from the UK operations only,

and for a huge international back like HSBC, that is big.

Is it time to rein the bankers in? We have to be careful how we

generalise and simplified. The Chancellor used the word this

morning Casino, Lucy mentioned gambling banks, and I don't think

that is quite right. There is a core of our economy that is about

retail banking, provided the bedrock of lending to small

businesses. They are part of the solution, not the problem.

Investment banking, too, has a role in Britain's success. They make

some of the processes in the City worked. We have to be wary of

seeing them as easy targets. They certainly have a place to play,

but when you see the excesses and of these single people with these

tens of bn-Pounds on bonuses, something needs to rein that in.

Both of you can now retire to your respective corners. Thank you very

much for being with us tonight. It has been a rough year for many

businesses, but not everyone has been put off setting up on their

own. Our correspondent visited one person who took the plunge.

James has been running his business from his kitchen table since the

spring of this year. His farm need these patented wall planters.

They're designed for people with limited outdoor space who want to

add some greenery to their homes. Like many new small companies, he

decided that applying for funding from his bank would be fruitless.

kept it as lean as possible and not spend any money I did not have to.

We work from the kitchen at home rather than splashing out one

offices, and the team that worked with me are unpaid on the basis

that when it takes off they will get a share of the profits. We have

done ever think as clean as possible so we have not had to go

to the bank to borrow money. Why did you not to call to the

banks to approach funding? I can imagine the groups we would

have to jump through. I am almost certain we would have to put our

house as security for a business loan. I was not prepared to that,

so I dipped into my own savings and creatively made a little bit of

money goal long way. This company, like many new

entrants into the marketplace, has been self funded and has been

successful so far. Looking for James's Business Google, he may

need to turn to banks to get vital financing. Many banks have been

criticised for their unwillingness to lend to businesses. This

prompted the Government to move into an agreement with four new

Major at -- four major UK banks, under -- known as Project Merlin.

The the agreement, there four banks have to lend �190 billion. So far,

it looks like the banks will hit this headline comment. �76 billion

has been earmarked for small firms. Here, the picture is not so rosy.

According to the Bank of England, lending to small and medium-sized

businesses is down this year. The federation of Small businesses says

a lack of lending is not the only factor that has impacted on the

growth of small firms. The businesses are really

struggling to access financing to invest and grow businesses, all

thought to cover cashflow. It has also been difficult in terms

of volatility in fuel prices and in utility prices, as well. The really

since the recession hit, small businesses are still struggling.

Apart from lending, what are the other major challengers for small

businesses. They are being affected by the high cost of fuel and the

lack of stability in prices, and one thing we have asked for a for

the Government to introduce a fuel duty stabilised at to make fuel

prices more predictable, better financial planning and that kind of

thing. The economic environment this year has been difficult, but

there are opportunities out there. We have had interest from

construction companies who want to use these for corporate social

responsibility projects, things like a plant wall within a

community. Another area we have had interest from is a company that

grows plants that are then sold by retailers, so potentially as a

packaged product, so that could be a big outlet into major retailers.

He if, like James, you are willing to back yourself and put your plans

into action, possibly you too could have a flower in business.

That is it for this week and this year. Thank you for your company