Air fryers and vinyl: Welcome to 2024 Britain
The business news that matters
Hello and welcome to the latest edition of Off to Lunch…
The inflation basket. It may not sound like the most exciting of topics, but bear with me.
The inflation basket is the collection of goods and services that the Office for National Statistics uses to measure inflation in the UK. The ONS tracks how the price of these items has moved month-on-month and year-on-year to calculate the overall rate of inflation in the UK. The basket is designed to reflect what is being bought in the UK. The ONS updates the basket every year to introduce new items and remove others.
Today the ONS has announced what is being added to the basket and taken away for 2024. This gives us a glimpse at the British consumer in 2024. I am sure that one day historians will look back at the basket as a way to summarise how people were behaving at the time.
Before we get on to the list, this is the ONS’s summary of how it decides what to include:
There are some individual goods and services where spending is so large that they merit inclusion in the baskets in their own right, such as petrol. More commonly, a sample of specific goods and services must be selected that gives a reliable measure of price movements for a range of similar items.
Several factors are considered when choosing representative items, including:
ease of finding and pricing the product
availability throughout the year
amount spent on a particular item or group of items
variability of prices within a class
an analysis of the balance across the basket
The ONS says it has added 16 items and removed 15 for 2024, meaning there are now 744 in total. These are the items that have been added:
Rice cakes
Gluten-free bread
Home-killed pork chop/steak
Spray oil
Sunflower/pumpkin seeds
Pre-packed salad
Women's socks
Air-fryer
Second-hand petrol car
Second-hand diesel car
Vinyl music
SD card
USB stick
Card game
Wild bird seed
Takeaway hot drink
Some of these items have been added due to administrative tweaks by the ONS. For example, used-cars have now been split into petrol and diesel while the definition of pork chop/steak has been changed to remove “with bone” (home-killed means that it was produced in the UK). “Takeaway hot drink” is a new combination of tea and coffee because the ONS thinks that restaurants and cafes are “over-represented” in the basket.
However, other items have been added because of their rising popularity - such as vinyl, air fryers and gluten-free bread. The table below from the ONS shows all the new items and why they have been included…
And here are the items that have been removed. This includes hand gel - an item that was introduced post-Covid - and sofa beds….
Of all the new items, vinyl is particularly eye-catching. This is a comeback for an old technology, unlike the addition of the air fryer, which is a new product. This is the first time that vinyls have been included in the inflation basket since 1992.
Business Leader has done a big feature on the resurgence of vinyl, why it has happened, and the lessons for other businesses. This is an example of physical and digital complementing each other, and fans of particular artists looking to engage with them more. The best-selling vinyls in 2023 were by Taylor Swift.
You can read this feature here
Podcast…
The new episode of our Business Leader podcast looks at the story of how Ophelia Brown built Blossom Capital, a venture capital firm which has raised around $1 billion (£789 million) from investors since she launched it in the UK in 2018. Blossom is a rare success story - it is a female-led start-up and venture capital firm but is also thriving away from the traditional heart of this industry in Silicon Valley. Blossom uses the money it has raised to invest in promising businesses in Europe. We speak to Ophelia Brown about how she founded the business, raised the money, and what she has learned along the way.
You can listen to the episode on Substack here, Apple here and Spotify here
Other stories that matter…
1. The US hedge fund Elliott Advisers has withdrawn from the race to buy Currys, the electricals retailer. JD.com, the Chinese online retailer, is still interested. Elliott said in a statement that “following multiple attempts to engage with Currys' board, all of which were rejected, it is not in an informed position to make an improved offer for Currys on the basis of the public information available to it”. You can find the statement here
2. Small businesses in the UK are being asked to repay tax breaks they received for investing in research and development (R&D). HMRC says it is reassessing tax relief claims after underestimating the level of error and fraud. But business groups say the issue is being “mishandled”. BBC story here
3. 45 per cent of founders think their mental health is “bad” or "very bad” and 49 per cent are considering quitting their business this year, according to a survey of start-ups by the tech website Sifted. More here
4. An insight into how success can come from unexpected places: The I’m Just Ken song was nearly cut from the Barbie movie because the studio didn’t like it. The song went on to be nominated for an Oscar (Ryan Gosling performed it at the awards last night) and was a huge part of the movie’s success. “At that first screening the song wasn’t working. I panicked,” said Mark Ronson, who co-wrote the song. More here
5. Liverpool drew 1-1 with Manchester City on Sunday. Ahead of the game, The Sunday Times published an excellent piece about the two managers - Jurgen Klopp and Pep Guardiola - and how their rivalry over the last ten years has pushed them to innovate and reach new heights. You can read the piece here
The new Business Leader…
The new Business Leader website and magazine have now launched. We are building a new agenda-setting, inspirational and aspirational business publication for the UK. You can read our analysis, interviews and expert columnists on our website by clicking the image below. Our new magazine is now in shops and you can subscribe to your own print or digital version by clicking here
And finally…
A collection of book recommendations for you from Tom Rowley, who runs the Backstory bookshop in Balham, south London, and writes a newsletter about his experiences. Tom is just back from a holiday in Tenerife, where he was able to read a collection of newly-released books. These included You Are Here by David Nicholls, Maurice and Maralyn by Sophie Elmhirst and The Safekeep by Yael van der Wouden, which he is said is the best novel he has read so far this year. You can find the newsletter and the books here
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