23rd September 2021
Good morning There’s been another major move in the streaming wars. Netflix has made its biggest content acquisition, snapping up legendary author Roald Dahl’s works for £500m. The Roald Dahl estate offers a huge global opportunity for Netflix as his books have been translated into 63 languages and sold more than 300m copies. It comes just months after Amazon paid $9bn for MGM, the Hollywood studio behind James Bond and Rocky.
- The not so special relationship – US cools talk of UK trade deal
- More sandwiches – Pret plans 200 store expansion
The not so special relationship – US cools talk of UK trade deal
What’s going on?
The UK’s hopes of a trade deal with the US have been dashed in Boris Johnson’s first visit to the White House as prime minister.
Why is this important?
Since the UK left the EU single market it’s been on a mission to strike free trade deals around the world - including with the US, with which annual trade is worth an estimated £200bn.
A deal would encourage more business between the two countries by making it cheaper, usually by reducing or eliminating tariffs.
During the 2016 Brexit referendum, the Leave campaign had touted that a bilateral trade deal with the world’s largest economy would be easy to come by.
Five years on and the reality has turned out quite different. Johnson had claimed that the UK would be first in line to agree a trade deal but President Joe Biden is less enthusiastic.
Talks of a deal had started last year when Donald Trump was in the White House. But the Biden’s administration has not picked up the baton.
Negotiations could be made tricky by the US list of controversial demands. It wants access for American firms to UK healthcare and a market for US agricultural products. Touching the NHS and watering down food standards are both politically dangerous moves.
Brexit gave the UK the freedom to strike its own trade deals and so far it has managed to do so with Japan, Australia and India. But the US is by-far the biggest prize.
The US is the UK’s biggest trading single trading partner, a trade deal between the two would be a huge win for the government.
But it’s becoming clear that the UK isn’t at the top of Joe Biden’s priorities. Boris Johnson may either have to play the long game or look for alternative deals with other countries.
More sandwiches – Pret plans 200 expansion
Workers are gradually heading back to the office and Pret A Manger has taken that as a cue to expand its footprint.
The sandwich chain has revealed plans to open 200 stores in the UK and hire 3,000 staff over the next two years. It’s part of a post-coronavirus strategy that will see it target customers away from city centre offices after a pandemic driven slump.
The ambitious plans will be funded by £100m of new investment from founder Sinclair Beecham and majority owner JAB.
Both had contributed a total of £185m to get the chain through the pandemic and back on its feet.
Pret is also planning to enter five new markets by the end of 2023. It currently has almost 400 shops in the UK with 150 in France, the US, Dubai and Hong Kong.
The chain closed 30 outlets early in the pandemic, 11 of them in London and many in what were once commuter centres.
It’s now reported that UK sales are approaching pre-Covid levels again after revenue more than halved last year to £299m.
Pret is evolving its strategy to the new hybrid way of working. In the past 18 months the company has tried to expand into other revenue streams less dependent on office workers. It launched frozen croissants in supermarkets and a coffee subscription service.
It hopes that opening new stores in more suburban areas will mean it can still capture consumers who are living lives closer to home and away from city centres.
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