The British Retail Consortium is the trade association for the entire retail industry in the UK. Mem, membership comprises over 200 major retailers and thousands of smaller traders.
Between inflation, an energy crisis, HFSS regulations and three different Prime Ministers, the UK has faced a year of challenges that are set to continue. Food inflation for November 2022 had the highest increase ever seen since the records began in 2005. Sitting at 12.4 percent, it was up from 11.6 percent in October.
One thing that the UK does remain a leader in, however, is its number of supermarkets. While consumers in markets with less competition must manage the hand dealt by a few businesses, chains in the UK remain competitive and allow customers excellent variety in times when prices are key. Aldi, Lidl, Tesco, Asda, Sainsbury’s, Morrisons, Ocado, Waitrose, Co-op, and M&S have almost all reported a drop in profits this year, as they are not passing the cost of price inflation onto customers. The 2022 holiday season saw the annual supermarket price competition, which dropped bags of some vegetables down to as little as 19 pence.
Helen Dickinson, Chief Executive of the British Retail Consortium, has noted the numerous challenges and said 2023 looks to be much the same.
“The UK economy has been buffeted by soaring inflation, political instability, and a weak pound. Households have faced inflation rates not seen in over forty years, as the war in Ukraine drove up food and energy prices. Rising costs and falling sales volumes have also meant an increasingly challenging year for retailers. As competition for the limited consumer spend heats up, retailers will need to focus on delivering value to their customers.”
“Customers are more cautious in their spending, looking for the best value for money in their purchases. Even higher-income households are trading down to cheaper brands, while many value brands have seen a huge jump in demand. Retailers must respond to this backdrop by continuing to put the needs of their customers first and ensuring everything they do represents excellent value for money. And those selling more discretionary products will need to work twice as hard to show the value and importance of their products to their customers.”
