Interview: Barrister who was called to the bar
Tim Martin's Wetherspon pubs have no music, no TVs and people can't get enough of them
Sunday 10 January 1999
We all know that looks can be deceiving. A major contributing factor to Wetherspoon's success is the company's strict no-music policy. Music is banned even in the Wetherspoon pub that was once an old rock music venue, the Marquee, in London's West End.
But even Martin must have been singing in the shower last week after an off-the-cuff comment he made in a news agency industry poll that fourth- quarter earnings would rise between 5 and 10 per cent. The market cheered, especially as competitors were less than forthcoming, pushing Wetherspoon's stock up by a similar amount.
Martin was even more upbeat when I met him last week at the Rochester Arms pub in London's Stoke Newington, another Wetherspoon establishment. Turnover for the Christmas week was 50 per cent up on last year, equivalent to the entire takings of 1990, which were pounds 7m. The company opened 17 new pubs in December alone. In 1998 as a whole, 100 new Wetherspoon pubs opened their doors across the country, taking the total number to 306. Earlier this month the company announced it planned a pounds 100m expansion this year, creating 2,000 new jobs. "The thing about Wetherspoon few people realise is the dramatic pace of growth," said Martin, adjusting his long legs to fit under one of the pub tables. "Apart from companies that have taken over others, we probably have the highest week- on-week increase over the long run of virtually any retail or comparable restaurant company that started in Britain," he said.
Not bad going for a business started by a man who, despite qualifying as a barrister, turned his back on the Bar to run bars because he was too slow a reader. "I can only to this day read a law book at three pages an hour. A lot of the students could read between 10 and 15 times that rate. By the end of the first term I had a real inferiority complex," he bellowed.
Martin bought his first pub when he was only 24 and still attached to the Inns of Court. He was living in Wood Green, north London, at the time. "I was looking for a decent pub to drink in and the pubs in Haringey and Wood Green at that time weren't up to much, so even as a relatively impoverished student I grabbed a cab to Muswell Hill where someone had converted a small betting shop into a pub. It was the first building in modern times that had been converted to pub use." After discovering that the landlord was earning pounds 500 a week, Martin sold his flat and used the money to buy the pub. He named it Wetherspoons, after a trainee teacher who once taught him in Auckland, New Zealand. Martin chose the name because that teacher "was the least likely person to control a pub because he could not control a class".
It wasn't just the name that stuck. Converting non-pub buildings into drinking places quickly became another Wetherspoon trademark as Martin turned to his advantage brewers' reluctance to sell their pubs to the young upstart. A recent Wetherspoon acquisition was the Half Moon theatre in London's East End, once a hotbed of Eighties agit-prop theatre. Other pubs belonging to Wetherspoon include the former ballroom of the Great Eastern Hotel in Liverpool Street and the Square Peg in Birmingham, converted from an old John Lewis department store. "We always try to make sure the pubs keep something of their local flavour and the history of the building," said Martin, although he admits "there is only so much you can do with a Kwik-Save or a Tesco's", both of which have sold stores to Wetherspoon that were turned into pubs.
Another Wetherspoon feature that has proved unsurprisingly popular is the cheap price of its beer. On the table Martin was sitting at in the Rochester Arms there was a promotional menu advertising Becks lager at 99p a pint.
Wetherspoon was floated as a public company in 1992. Martin still keeps a newspaper article on the wall of his office at the company's Watford headquarters from that time. "For 20 years I read The Times and there was an article in the Tempus column that said Wetherspoon's prospectus was a "sour brew" and the idea of converting shops into pubs was a silly one," he said.
"The article said investors should copy the example of Scottish and Newcastle, who had a stake in the company, and bail out," he said, roaring with laughter again. "I was quite devastated really. I'd learnt everything I knew from this column." Within a year the company share price had doubled. "I now quite enjoy being criticised. It's also a perverse enjoyment. I'm absolutely determined they'll live to rue that day."
That stubborn streak has almost got Martin into trouble on a few occasions. Wetherspoon is only now just starting to recover from its refusal to install television sets on its premises during last summer's World Cup. The company lost an estimated pounds 1m as a result, sending the share price temporarily into the doldrums.
Undulating share prices don't seem to bother Martin, though. He says he took great pleasure in being cited in the press recently as the man who lost the fifth-most amount of money last year. "It was almost a relief," he laughed.
Martin is currently worth around pounds 65m yet his lifestyle is modest. He met his wife Felicity while he was still at university and the couple live with their four children in Exeter "because I wanted to be near my mother-in-law", he quipped. Martin doesn't take fancy holidays abroad, preferring cliff-top strolls in Cornwall when he wants to get away from it all. Although he confesses to being a "died-in-the-wool" drinker, he gave up smoking nearly 15 years ago and exercises for two hours a day.
Martin doesn't seem unduly worried about a possible downturn in the economy. "If there is a recession now it will be the third since we started in the business 19 years ago. Good companies can turn recession to their advantage sometimes because it has a worse effect on a badly run company than on a well-run one, so we are just trying to make sure ours is well run," he said.
The management style at Wetherspoon is one of openness. At headquarters, 8.30 prompt every Friday morning, Martin meets with the staff and with visiting managers from pubs around the country. People are encouraged to express their opinions.
Martin said that for his managers "it's more important to get on with the people who work for you than with the customers. You have to have a high energy level."
He says the businessman he most admires, and on whose business philosophy he has modelled his own company, is Sam Walton of the cut-price discount retail chain Wal-Mart. "Walton started the company in 1962 when he was already in his early forties. It is now by far the world's biggest retailer. His ethos of running the business has had a big influence on us."
Still in his early forties himself, does Martin plan on branching out in a new direction? "Not for the time being. The business takes up all my energies. I am so absorbed in one thing and have been for 19 years in a way that would drive most people bonkers."
The pub business is definitely in the family blood. Tim's brother Gerry also owns a pub outfit - the Old Monk Company, which he recently brought to the stock market. Has that caused any friction between the two? "There have been certain tensions from time to time but we haven't fallen out over it," said Martin.
Any chance Wetherspoon might eventually buy out his brother? "Maybe he could take us over. I'll ask him," he joked. "I knew there was a way out. I just hadn't thought of it," he said, breaking into yet more roars of laughter.
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