Survey: Inflation to add over £18.2Bn to UK’s non-food retail sales

Inflation is reportedly expected to add another £18.2 billion (US$22 billion) to the UK’s non-food related retail sales in 2023, claims a new survey.

As per an E-commerce Delivery Benchmark Report by Auctane as well as Retail Economics, sales figures are anticipated to reach £249 billion (US$301.4 billion) in 2023, however, the 2.6% growth, or a further £18.2 billion (US$22 billion) in spending over last year, will be solely driven by higher consumer prices.

According to a survey of more than 730 retail enterprises with eight global locations, 80% plan to raise product prices this year, with 40% citing rising expenses as their top concern.

As per Retail Economics, the main issue for 66% of UK consumers is inflation. Over 74% of UK consumers now plan to make changes to their buying habits, with 34% indicating they will only make essential purchases while 29% saying that they intend to postpone or limit spending.

Due to consumers needing to spend more money in order to receive less for their money, UK retail sales figures are expected to drop by 4.9% compared to last year, with retail inflation forecast to reach 7.5% in the coming year.

The study found that over a quarter of retail enterprises expect to raise the delivery cost for their consumers this year, while only 18% stated they would not raise the price of products, returns, or delivery.

For their online orders, nearly 30% of UK consumers stated they would happily move to parcel lockers or click-and-collect options.

Retail Economics CEO, Richard Lim, stated that retailers will continue to deal with a toxic mix of challenges this year as growing input and operating costs meet against a backdrop of weakening customer needs, increasing interest rates, and evolving consumer behaviors.

These circumstances favor retailers with sound financial standing who can make significant price investments, use data to target and acquire new customers, and effectively employ stores to offer a true omnichannel experience.

Source credit: https://www.independent.co.uk/news/business/news/uk-inflation-food-retail-data-london-b2277916.html