WEBVTT - Get Ready for a ‘Ho-Hum’ UK Retail Holiday

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<v Speaker 1>The holidays, they're here.

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<v Speaker 2>I'm not surprised.

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<v Speaker 1>I feel like I've been buying Christmas presents for the

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<v Speaker 1>last seven months. But and yet I sound surprised.

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<v Speaker 3>I had a strong start, but now I've got fatigue.

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<v Speaker 1>Now I'm tired of it.

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<v Speaker 3>I think I better return to it once this podcast

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<v Speaker 3>is finished, and once the readout is written, I won't multitask.

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<v Speaker 3>But I find it so interesting what is happening at

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<v Speaker 3>Christmas with spending is often a kind of canary down

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<v Speaker 3>the mine or a sort of indication of the economics

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<v Speaker 3>of the coming year, and obviously there were likely to

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<v Speaker 3>be an election in that year, and it's just interesting,

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<v Speaker 3>I think also because people get together with families from

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<v Speaker 3>different generations, and I think it's probably that moment when

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<v Speaker 3>voters start to say, yeah, what am I What am

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<v Speaker 3>I going to do with my vote this year? If

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<v Speaker 3>they're swing voters, which a large large number of people are.

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<v Speaker 3>So I think, you know, I'm really looking forward to

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<v Speaker 3>hearing from Andrew and Katie because their copy as well

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<v Speaker 3>inside Bomberg, is always point. It's always one point, and

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<v Speaker 3>it always tells you something about the psyche of the

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<v Speaker 3>of the nation.

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<v Speaker 1>Yeah, and they have different perspectives. So we'll talk a

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<v Speaker 1>little bit about luxury, we'll talk about retail, we'll talk

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<v Speaker 1>about the high street, but we'll also talk about food,

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<v Speaker 1>which is such a you know, prominent important.

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<v Speaker 3>Christmas.

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<v Speaker 1>Yeah, welcome to In the City, Bloomberg's podcast, connecting you

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<v Speaker 1>to the conversations and the stories shaping the world of finance.

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<v Speaker 1>I'm froncing like wow with a Legra Stratton and this

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<v Speaker 1>week we talked to Andrea and Katie to try and

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<v Speaker 1>really feel the temperature for shopping across the UK. We're

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<v Speaker 1>delighted to be joined by Andrew Felstad, Bloomberg opinion columnists

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<v Speaker 1>covering consumer goods and the retail industry, and Katie Lindsel,

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<v Speaker 1>Bloomberg UK retail reporter. So this is like a dajavoo.

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<v Speaker 1>We did this exactly twelve months ago and everyone was

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<v Speaker 1>excited about Christmas because there was like revenge Christmas and

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<v Speaker 1>people after two very long years of lockdown, we're going

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<v Speaker 1>to get together. This year just feels a lot different.

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<v Speaker 2>Yes, I think, I mean lockdown is still in our

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<v Speaker 2>living memory, so I think people do want to get

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<v Speaker 2>out and shop, but we've had a really ongoing cost

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<v Speaker 2>of living crisis now, and so people are really looking

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<v Speaker 2>at how much they can spend. And I mean my

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<v Speaker 2>view is that it's going to be a bit of

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<v Speaker 2>a doom and gloom one. I don't know if Andrew

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<v Speaker 2>is quite so so negative as I am, but already

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<v Speaker 2>we've seen November sales were weaker than people hoped, so

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<v Speaker 2>I'm a bit negative on this one.

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<v Speaker 4>I don't think it's going to be a spark club,

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<v Speaker 4>but I don't think it's going to be a stinker either.

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<v Speaker 4>It's going to be kind of fair to middling. Last year,

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<v Speaker 4>I was absolutely convinced it will be a good Christmas

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<v Speaker 4>and it turned out to be so because, as Katie said,

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<v Speaker 4>it's the first year for three that we didn't have

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<v Speaker 4>any COVID restrictions. This year, I'm not quite so optimistic.

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<v Speaker 4>On the plus side, we haven't got as many strikes

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<v Speaker 4>as we had this time last year. If you look

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<v Speaker 4>around this time lat year, it was actually snowing, always

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<v Speaker 4>bad for football. Inflation is coming down, so that's that's

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<v Speaker 4>all pretty good stuff. On the negative side, as Kate said,

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<v Speaker 4>the cost of living crisis has not gone away, and

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<v Speaker 4>on heating we're not getting the government support. Plus interest

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<v Speaker 4>rates are probably more of a worry this time for

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<v Speaker 4>this Christmas than they were a year ago, So a

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<v Speaker 4>bit of a ho hum Christmas. It's not ho ho no,

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<v Speaker 4>but it's not ho ho hooray either.

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<v Speaker 3>What we're here for. Can I just ask a question,

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<v Speaker 3>which is is that sort of lockdown is still in

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<v Speaker 3>people's memories? Does that effect buying? Is it effect buying

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<v Speaker 3>because they've still got some COVID savings saved up? Or

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<v Speaker 3>does it affect buying because people are actually thinking, oh,

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<v Speaker 3>I remember two years ago when we couldn't leave our houses.

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<v Speaker 3>I'm going to go and shop.

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<v Speaker 2>How does it?

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<v Speaker 3>How does it?

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<v Speaker 2>I think the COVID savings really started to be eroded

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<v Speaker 2>by now. That's something that retailer's really kind of erode

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<v Speaker 2>on over the past year or so, saying, even though

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<v Speaker 2>we have this terrible inflation, people really saved over COVID.

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<v Speaker 2>I think now the key comparison to make is that

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<v Speaker 2>people are really getting out to shops. You know, we're

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<v Speaker 2>yet to see how much they're spending when they're in

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<v Speaker 2>these shops, but when you're around London and some of

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<v Speaker 2>the key shopping districts, it is busy people. People can

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<v Speaker 2>get out now with less of a fear of a pandemic,

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<v Speaker 2>and they're in restaurants, they're in bars, they're in all

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<v Speaker 2>the all the kind of great shops of London. So

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<v Speaker 2>that's really encouraging. And online has come back a bit.

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<v Speaker 2>Having said that, you know, I think online will still

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<v Speaker 2>have its time over Christmas. I personally am going to

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<v Speaker 2>be glued to my screen doing boring online shopping. But yes,

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<v Speaker 2>I think I think the pandemic is still a key

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<v Speaker 2>comparison period.

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<v Speaker 4>I think there won't be that automatic lift that we

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<v Speaker 4>got last year because everybody was out seeing family and friends. Again.

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<v Speaker 4>I just don't think we're going to get that surge

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<v Speaker 4>that we automatically got, so retailers, restaurants, they're all going

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<v Speaker 4>to have to work harder for everything this year.

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<v Speaker 1>So what are people buying? I mean, what do people

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<v Speaker 1>not want to buy?

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<v Speaker 2>I think gifting is the key area where spending is

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<v Speaker 2>actually coming back a bit so PwC their figures for

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<v Speaker 2>spending over the Christmas season is thirteen percent down at

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<v Speaker 2>twenty billion, So really it sounds bad on the part

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<v Speaker 2>of consumers, but it's an area where if you have people,

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<v Speaker 2>you don't have to gift to don't. If you have

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<v Speaker 2>people who you do love a lot, you're going to

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<v Speaker 2>be spending gifts on them, but you might spend a

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<v Speaker 2>little bit less. Having said that, Black Friday wasn't the

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<v Speaker 2>big boom that was hoped, it's kind of turned more

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<v Speaker 2>into a Black November, and the British Retail Consortium said

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<v Speaker 2>it got off to a really good start that sort

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<v Speaker 2>of Black November, and then kind of fizzled out towards

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<v Speaker 2>the end. So I think people are being a bit

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<v Speaker 2>more frugal with their gifting and really being quite quite

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<v Speaker 2>careful with where they spend their money.

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<v Speaker 4>And I think the other area that's really suffering at

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<v Speaker 4>the moment is big ticket items, you know, any big

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<v Speaker 4>other than holidays, which still seems to be doing well,

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<v Speaker 4>but sort of Home Renovation's home furnishings. Even Halford said

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<v Speaker 4>that people weren't spending on expensive bikes as much now.

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<v Speaker 4>One thing that I thought was really interesting last year

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<v Speaker 4>the big gift was the dice in air wrap. This

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<v Speaker 4>year we've seen like one hundred pounds off. It's back

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<v Speaker 4>to full price or nearly it's normal four hundred and

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<v Speaker 4>eighty pounds price in many places, but it's still that

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<v Speaker 4>was a big discount on an expensive purchase. So I

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<v Speaker 4>think it's those big where you have to spend out

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<v Speaker 4>a lot of money that are really being rained in.

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<v Speaker 2>Yeah, like watches and jewelry, these items that you might

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<v Speaker 2>think would be a go to for gifting at Christmas.

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<v Speaker 2>People aren't really pulling back on those treats.

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<v Speaker 3>So they're pulling back on the big amounts. But are

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<v Speaker 3>you seeing that there's more smaller amounts that's sort of

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<v Speaker 3>spreading the love more.

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<v Speaker 2>I think it's hard to know. I mean if we

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<v Speaker 2>look at sort of fashion, I think that's going to

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<v Speaker 2>be a tricky area over Christmas. Makeup, makeup, Yeah, we

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<v Speaker 2>talk about the lipstick index, don't we in this kind

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<v Speaker 2>of economy, So I think people are going to be

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<v Speaker 2>going for sort of affordable beauty items, affordable clothing here

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<v Speaker 2>and there. I mean one of the items that I

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<v Speaker 2>hear is doing very well is this thing called a

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<v Speaker 2>snuggle hoodie, which is yeah, absolutely because sort of snuggly

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<v Speaker 2>fleecy goes over your head, covers your whole torso. And

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<v Speaker 2>I think there's also a reader cross here to energy bills.

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<v Speaker 2>You know, if you if you can kind of turn

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<v Speaker 2>down your heating a bit and being your snuggle hoodie.

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<v Speaker 2>That's that's the way to go, and they're not very expensive.

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<v Speaker 4>I think Katie's touched on something really important here looking

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<v Speaker 4>back on this year, it's been much better than people

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<v Speaker 4>have expected. I mean, next said that the consumer had

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<v Speaker 4>really defied gravity this year, and I think Katie's exactly

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<v Speaker 4>put a finger on why, because we've all adapted. So

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<v Speaker 4>we've worn a snuggle hoodie indoors but turned our heating down.

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<v Speaker 4>We've shopped in audi your liddle or we've bought own

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<v Speaker 4>label products and we've we've really adapted to the situation,

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<v Speaker 4>which is why consumer spending has been so much better

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<v Speaker 4>this year than I predicted backing back last year.

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<v Speaker 3>My favorite is the electric heater, the mattress topper, which

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<v Speaker 3>I brought.

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<v Speaker 2>Quite a few of.

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<v Speaker 1>What is that which I need in my life?

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<v Speaker 3>You have to my kids put it on three and

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<v Speaker 3>then when they're asleep.

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<v Speaker 2>I have to go and kind of cooking.

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<v Speaker 3>But what so we saw recent I think it was

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<v Speaker 3>last Friday, we saw a survey of the electro is

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<v Speaker 3>not the electric of consumers and their expectations of inflation

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<v Speaker 3>are that it comes down. How does that? How does

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<v Speaker 3>that What do you think with your expertise, what does

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<v Speaker 3>it impact your.

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<v Speaker 4>Be I think it is going to come down. I

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<v Speaker 4>think food prices are going to come down. And my

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<v Speaker 4>prediction for next year as we get a supermarket price

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<v Speaker 4>war because and the way this will happen is through promotions.

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<v Speaker 4>Because the branded, the big branded manufacturers have ceded a

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<v Speaker 4>lot of volume to private label and they will want

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<v Speaker 4>to try and claw that back. They don't want to

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<v Speaker 4>necessarily reduced prices, but you will see a lot of

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<v Speaker 4>special offers and the supermarkets will fight for those sales.

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<v Speaker 4>And the way that they'll do it is through their

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<v Speaker 4>loyalty cards. The other really interesting thing about food is

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<v Speaker 4>when inflation is rising, everybody can win because everybody's seals

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<v Speaker 4>goes up when it comes down, particularly if costs are

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<v Speaker 4>still going up, like we've got the minimum wage going up,

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<v Speaker 4>they all have to fight for share and what they need,

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<v Speaker 4>they need like weak players to feed off. And at

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<v Speaker 4>the moment we've got two We've got Morrisons, we've got Asda,

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<v Speaker 4>both in private hands. So I predict a supermarket price

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<v Speaker 4>war to put pressure on Morrison's and Asda. So I

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<v Speaker 4>think that will feed into bills next.

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<v Speaker 2>Year, and what's happening with John Lewis well, and they're

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<v Speaker 2>in the shape with Waitros and how Waitross are the pointing.

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<v Speaker 2>I mean, it depends if we look at John Lewis.

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<v Speaker 2>I think this Christmas is so crucial and we won't

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<v Speaker 2>hear from the mental march to know how it's gone.

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<v Speaker 2>But really, you know, they need to really show their

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<v Speaker 2>strength in this environment, and online is quite key for

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<v Speaker 2>John Lewis, and I think they're you know, they're competing

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<v Speaker 2>with the likes of Amazon, who can get the delivery

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<v Speaker 2>to you the next day, and it's really tough. Going

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<v Speaker 2>to Andrew's point about the supermarket price war, I think

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<v Speaker 2>Waitros is in a really weak position. They desperately need

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<v Speaker 2>some funding to invest in their stores and pull in shoppers.

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<v Speaker 2>And I think a lot of those high end shoppers

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<v Speaker 2>who are doing relatively well through the cost of living

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<v Speaker 2>crisis are going to mines instead. Christmas is the kind

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<v Speaker 2>of time of year when waitress should be really getting

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<v Speaker 2>shoppers in through the door for canapees and party treats

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<v Speaker 2>and all that sort of thing, and I think it's

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<v Speaker 2>it's yet to be seen if they manage that this year.

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<v Speaker 2>So it's going to be really tough.

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<v Speaker 3>Okati, you said, it's a shame we have to wait

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<v Speaker 3>until March. I think you said for John Lewis or

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<v Speaker 3>what what happens if it's been a bad Christmas.

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<v Speaker 2>Well for the other retailers, we get lots of January updates,

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<v Speaker 2>so we do find out relatively soon on how their

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<v Speaker 2>trading has gone this time last year. Well sorry, January

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<v Speaker 2>last year we had lots of the supermarkets, as Andrew said,

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<v Speaker 2>with with the impact of inflation, lots of super markets

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<v Speaker 2>coming out saying oh we had a record Christmas. You know,

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<v Speaker 2>shoppers really spent with us. Of course they did. Because

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<v Speaker 2>prices are so high in food, we're all sort of

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<v Speaker 2>spending more to get less. I think this this coming January,

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<v Speaker 2>with this with food, it's going to be another story

0:11:15.800 --> 0:11:19.920
<v Speaker 2>of a bumper Christmas of spending. I think Kantara are

0:11:19.960 --> 0:11:23.920
<v Speaker 2>forecasting thirteen just over thirteen billion pounds of spend, a record.

0:11:24.880 --> 0:11:26.720
<v Speaker 2>So yeah, we will we will see how things go

0:11:26.800 --> 0:11:28.560
<v Speaker 2>in the early New years. There's a record because it's

0:11:28.600 --> 0:11:31.360
<v Speaker 2>more expensive, it is, yeah, and also, of course food

0:11:31.400 --> 0:11:33.800
<v Speaker 2>is a necessity. We all have to buy it at Christmas.

0:11:33.840 --> 0:11:36.439
<v Speaker 2>We trade up, we buy the more premium items. Even

0:11:36.480 --> 0:11:38.120
<v Speaker 2>if you're still sticking to your Algie and you're little,

0:11:38.120 --> 0:11:40.920
<v Speaker 2>you're buying your more premium items within those supermarkets. So

0:11:41.400 --> 0:11:43.560
<v Speaker 2>it should it should go well in that sector of retail.

0:11:44.080 --> 0:11:46.480
<v Speaker 1>We had loads of supply chain issues, didn't we last year?

0:11:46.600 --> 0:11:49.079
<v Speaker 1>And I remember mind Christmas presents in like October. Cxandra

0:11:49.240 --> 0:11:51.240
<v Speaker 1>came on TV and said, you know, it's going to

0:11:51.240 --> 0:11:53.360
<v Speaker 1>be really difficult to get a hold of Lego. We

0:11:53.360 --> 0:11:54.079
<v Speaker 1>didn't have any of that.

0:11:54.200 --> 0:11:57.640
<v Speaker 4>No, that's really gone on, what that's really gone away now? Yeah,

0:11:57.679 --> 0:11:59.720
<v Speaker 4>And that's I think that's one of the reasons why

0:11:59.760 --> 0:12:02.160
<v Speaker 4>we or quite a lot of discounting on Black Friday

0:12:02.160 --> 0:12:06.000
<v Speaker 4>because last year, Yeah, last year we've you know, we

0:12:06.080 --> 0:12:08.520
<v Speaker 4>had like, you know problems, and you know, I think

0:12:08.559 --> 0:12:11.840
<v Speaker 4>the year before was a really bad one. Last year

0:12:12.240 --> 0:12:14.480
<v Speaker 4>it was coming to an end. And also people had

0:12:14.559 --> 0:12:17.600
<v Speaker 4>like a lot of stock last year because they they bought,

0:12:17.679 --> 0:12:19.880
<v Speaker 4>they'd bought loads early. So I didn't think that we're

0:12:19.920 --> 0:12:21.920
<v Speaker 4>going to get it supply chain eased up.

0:12:21.960 --> 0:12:24.160
<v Speaker 2>It all arrived, particularly.

0:12:23.679 --> 0:12:26.320
<v Speaker 4>In the US, just when people were you know pulling

0:12:26.360 --> 0:12:28.400
<v Speaker 4>in the purse string, so they were all stuck with

0:12:28.480 --> 0:12:31.000
<v Speaker 4>too much stock. So no, we I think the supply

0:12:31.080 --> 0:12:32.720
<v Speaker 4>chain is pretty much back to normal this year.

0:12:33.200 --> 0:12:35.600
<v Speaker 1>How's the luxury market doing? I mean again the price up.

0:12:35.760 --> 0:12:38.400
<v Speaker 1>You know, they've been able to bump a Pricer so

0:12:38.480 --> 0:12:40.880
<v Speaker 1>much it's almost a little bit of scene exactly.

0:12:41.000 --> 0:12:44.800
<v Speaker 4>Luxury is really slowing. So it's taken a while. But

0:12:45.600 --> 0:12:47.960
<v Speaker 4>as with many of the as many as with many

0:12:48.000 --> 0:12:51.240
<v Speaker 4>of the pandemic spending habits, it's taken a really long

0:12:51.280 --> 0:12:54.160
<v Speaker 4>time for them to unwind. But it is really unwinding

0:12:54.160 --> 0:12:57.480
<v Speaker 4>on luxury. As Katie mentioned, those pandemic savings, we had

0:12:57.520 --> 0:13:00.480
<v Speaker 4>nothing else to do without our money. So a man,

0:13:00.520 --> 0:13:03.280
<v Speaker 4>it was a rolex. For a lady, it was a

0:13:03.320 --> 0:13:09.120
<v Speaker 4>new handbag that really powered the luxury market. That's really unwinding.

0:13:09.160 --> 0:13:13.520
<v Speaker 4>And I'm not optimistic that the Chinese consumer is going

0:13:13.559 --> 0:13:15.400
<v Speaker 4>to come back and save the day. Because obviously the

0:13:15.480 --> 0:13:18.840
<v Speaker 4>Chinese VIPs treated very well at home. Now all the

0:13:18.880 --> 0:13:24.200
<v Speaker 4>brands have wonderful stores, wonderful service in China, the middle

0:13:24.240 --> 0:13:27.320
<v Speaker 4>class are going to be under pressure from the weakening

0:13:27.400 --> 0:13:31.800
<v Speaker 4>economy plus the inflation in flights, hotels, that sort of thing.

0:13:31.960 --> 0:13:35.000
<v Speaker 4>I'm not convinced Chinese consumer is going to ride back

0:13:35.040 --> 0:13:39.280
<v Speaker 4>to Europe and spend and particularly the UK is very

0:13:39.280 --> 0:13:42.480
<v Speaker 4>difficult in that market because of the loss of tax

0:13:42.520 --> 0:13:43.240
<v Speaker 4>free spending.

0:13:43.640 --> 0:13:46.440
<v Speaker 2>Yeah, when you talk to luxury retailers in London as

0:13:46.480 --> 0:13:49.920
<v Speaker 2>well as hoteliers, high end restaurants, they are really, you know,

0:13:50.080 --> 0:13:52.880
<v Speaker 2>upset about the fact that we have this so quoted

0:13:53.240 --> 0:13:56.920
<v Speaker 2>tourist tax. This is the time of year when you

0:13:56.920 --> 0:14:00.600
<v Speaker 2>would want wealthy foreign shoppers to be coming to London.

0:14:00.760 --> 0:14:02.800
<v Speaker 2>And I was in Selfridges recently. I mean it still

0:14:02.840 --> 0:14:07.760
<v Speaker 2>looks fantastic, are still packed with shoppers, but really it's

0:14:07.800 --> 0:14:09.520
<v Speaker 2>not the kind of Christmas that we've had in previous

0:14:09.600 --> 0:14:13.120
<v Speaker 2>years because people are choosing to spend in Paris and Milan.

0:14:14.120 --> 0:14:17.840
<v Speaker 2>You've even got British shoppers buying their barbery and their

0:14:17.920 --> 0:14:21.000
<v Speaker 2>mulberry outside the UK because it's cheaper. So it is

0:14:21.360 --> 0:14:22.560
<v Speaker 2>a very tough environment there.

0:14:23.160 --> 0:14:25.840
<v Speaker 3>So can I ask you sort of helicopter view question

0:14:26.120 --> 0:14:30.720
<v Speaker 3>having you both talked in amazing granularity about British shoppers,

0:14:31.360 --> 0:14:34.400
<v Speaker 3>but really fundamentally, do you think people will be feeling

0:14:35.360 --> 0:14:39.040
<v Speaker 3>comfortably off this Christmas or really under it under pressure?

0:14:39.160 --> 0:14:41.400
<v Speaker 3>What's the sort of macro picture, Because the reason I

0:14:41.400 --> 0:14:44.359
<v Speaker 3>asked the question is I sus. You know, the government's

0:14:44.480 --> 0:14:48.560
<v Speaker 3>view is if people in the months prior to an

0:14:48.560 --> 0:14:52.560
<v Speaker 3>election feel all right, then that's the sort of decent

0:14:52.840 --> 0:14:55.280
<v Speaker 3>basis on which to go to the electorate. So it's

0:14:55.320 --> 0:14:58.720
<v Speaker 3>not actually a kind of many years previous comparison people make.

0:14:58.760 --> 0:15:00.760
<v Speaker 3>People don't think like that. People think, do I feel

0:15:00.800 --> 0:15:03.040
<v Speaker 3>a bit better than last Christmas? Basically, I think.

0:15:02.880 --> 0:15:06.680
<v Speaker 4>It's going to really depend who you are, what your

0:15:06.720 --> 0:15:11.080
<v Speaker 4>income is, do you have a mortgage, how much of

0:15:11.120 --> 0:15:15.080
<v Speaker 4>your spend do you spend on essentials. It's you know,

0:15:15.120 --> 0:15:18.880
<v Speaker 4>I think older people have done very well this year

0:15:19.720 --> 0:15:23.280
<v Speaker 4>with you know, many of them don't have mortgages. They've

0:15:23.360 --> 0:15:26.080
<v Speaker 4>seen their pensions go up, they've seen their investments go

0:15:26.200 --> 0:15:28.520
<v Speaker 4>up for the first time they're actually getting a bit

0:15:28.560 --> 0:15:33.280
<v Speaker 4>of return on their savings. But I think younger middle

0:15:33.320 --> 0:15:38.000
<v Speaker 4>life families will be really suffering from the interest rate rises.

0:15:39.040 --> 0:15:42.280
<v Speaker 4>You know, school fees have gone up like massively. If

0:15:42.320 --> 0:15:45.160
<v Speaker 4>you want a holiday, you're having to spend a lot

0:15:45.200 --> 0:15:48.160
<v Speaker 4>more on a holiday, so I think, and then you've

0:15:48.200 --> 0:15:51.240
<v Speaker 4>got the very lowest consumer that spends a lot more

0:15:51.280 --> 0:15:57.600
<v Speaker 4>money on essentials have really been hurt by food energy,

0:15:57.960 --> 0:16:00.480
<v Speaker 4>So I think I don't think you can say like

0:16:00.640 --> 0:16:02.160
<v Speaker 4>one consumer exactly, of course.

0:16:02.280 --> 0:16:04.240
<v Speaker 3>I think the one thing, the interesting thing is that

0:16:04.240 --> 0:16:06.520
<v Speaker 3>that older population, for that they've done very well. They

0:16:06.520 --> 0:16:09.960
<v Speaker 3>do care about their children and their grandchildren. If they

0:16:10.000 --> 0:16:12.240
<v Speaker 3>can see that they're having a difficult Christmas, it's not

0:16:12.280 --> 0:16:14.800
<v Speaker 3>straightforward that they feel sort of smug.

0:16:15.320 --> 0:16:17.480
<v Speaker 4>The other thing I think, I think there's two things

0:16:17.520 --> 0:16:20.320
<v Speaker 4>that really are going to matter as we're going to

0:16:20.400 --> 0:16:23.560
<v Speaker 4>next year. One is the labor market and one is

0:16:23.560 --> 0:16:26.800
<v Speaker 4>the property market. The labor market's calling doesn't seem to

0:16:26.880 --> 0:16:30.080
<v Speaker 4>falling off the cliff. People make the biggest changes to

0:16:30.120 --> 0:16:32.640
<v Speaker 4>their spending when they lose their job or when they

0:16:32.680 --> 0:16:36.840
<v Speaker 4>see friends and family being made redundant. The housing market again,

0:16:37.000 --> 0:16:40.480
<v Speaker 4>calling hasn't fallen off a cliffs. If you take those things,

0:16:41.040 --> 0:16:44.160
<v Speaker 4>it's not looking too bad. I'm not as pessimistic for

0:16:44.280 --> 0:16:47.600
<v Speaker 4>next year as I was this time last year. And wages,

0:16:48.000 --> 0:16:51.960
<v Speaker 4>wages are calling, but they're still above inflation and so

0:16:52.600 --> 0:16:54.840
<v Speaker 4>really comes of holding up.

0:16:55.240 --> 0:16:57.200
<v Speaker 2>I think wages absolutely As you say, that's that sort

0:16:57.200 --> 0:17:00.960
<v Speaker 2>of key thing and Andrew mentioned next earlier. I think

0:17:01.080 --> 0:17:03.400
<v Speaker 2>M and S have also flagged this that going forwards,

0:17:03.400 --> 0:17:06.240
<v Speaker 2>we need to look at how people are spending when

0:17:06.240 --> 0:17:10.280
<v Speaker 2>they get their pay packets. I think next have been

0:17:10.359 --> 0:17:14.000
<v Speaker 2>so strong this year, you know, for profit upgrades over

0:17:14.000 --> 0:17:16.240
<v Speaker 2>the course of roughly the same number of months, because

0:17:16.280 --> 0:17:18.879
<v Speaker 2>they were happily surprised by how much shoppers when they

0:17:18.920 --> 0:17:22.959
<v Speaker 2>got their pay rise impacted by inflation, they were actually

0:17:23.040 --> 0:17:26.200
<v Speaker 2>choosing to go ahead and spend. But as we as

0:17:26.200 --> 0:17:29.080
<v Speaker 2>the months go through and inflation continues to be a burden,

0:17:29.280 --> 0:17:31.040
<v Speaker 2>that paypacket isn't going to mean as much as it

0:17:31.080 --> 0:17:34.280
<v Speaker 2>did months earlier. So I think there could be times

0:17:34.280 --> 0:17:36.400
<v Speaker 2>in twenty twenty four when it gets a bit tough

0:17:36.440 --> 0:17:39.400
<v Speaker 2>and M and S guided to their strong performance being

0:17:39.440 --> 0:17:41.280
<v Speaker 2>in the first half with the second half being a

0:17:41.320 --> 0:17:44.760
<v Speaker 2>weaker environment, so we have to see going forwards how

0:17:44.800 --> 0:17:46.640
<v Speaker 2>strong wages stand up against inflation.

0:17:47.880 --> 0:17:50.280
<v Speaker 1>Are there any retailers that we should actually worry about

0:17:50.320 --> 0:17:50.919
<v Speaker 1>going forward?

0:17:51.640 --> 0:17:55.360
<v Speaker 2>KPMG have warned of there being casualties early next year.

0:17:55.400 --> 0:17:58.040
<v Speaker 2>They said online only retailers are the ones to look at,

0:17:59.240 --> 0:18:01.560
<v Speaker 2>and I think we have seen quite a lot of

0:18:01.560 --> 0:18:04.640
<v Speaker 2>weakness in online only fashion, so I think that could

0:18:04.680 --> 0:18:08.040
<v Speaker 2>be a really difficult environment. And in terms of the

0:18:08.040 --> 0:18:09.600
<v Speaker 2>strength of the high street, you know, we already had

0:18:09.600 --> 0:18:12.640
<v Speaker 2>some quite major calamities in twenty twenty three. I mean,

0:18:12.680 --> 0:18:16.000
<v Speaker 2>Wilco is probably the main one to mention their biggest

0:18:16.000 --> 0:18:18.320
<v Speaker 2>retail in Solvac since Wilworth's in two thousand and eight.

0:18:18.960 --> 0:18:23.199
<v Speaker 2>So Christmas always tends to weigh on certain retailers. So

0:18:23.200 --> 0:18:25.600
<v Speaker 2>I think come January February it could be a busy time.

0:18:26.480 --> 0:18:27.120
<v Speaker 2>That was perfect.

0:18:31.640 --> 0:18:34.040
<v Speaker 1>Thanks for listening to this week's in the City. We'll

0:18:34.040 --> 0:18:36.119
<v Speaker 1>be back next week, but in the meantime, if you

0:18:36.280 --> 0:18:38.560
<v Speaker 1>like our show, please head on over to wherever you

0:18:38.640 --> 0:18:42.600
<v Speaker 1>listen to podcasts and rate, review and subscribe. It does

0:18:42.640 --> 0:18:45.240
<v Speaker 1>help people find the show. This episode was hosted by

0:18:45.240 --> 0:18:48.439
<v Speaker 1>me Francine Laqua and Alegra Stratton. It was produced by

0:18:48.480 --> 0:18:52.399
<v Speaker 1>Summersadi and Tiffany Schoy. Additional editing by Blake Maples and

0:18:52.440 --> 0:18:54.679
<v Speaker 1>special thanks to Andrea Felsted and Katie Linsel.