LONDON | Global consulting firm AlixPartners released its UK Christmas Grocery Forecast, predicting in-store Christmas food sales to see muted year-on-year growth in 2024.
In-store sales over the festive period are expected to increase in value by 2.5 percent year over year. However, when adjusted for inflation, this statistic decreased by 0.7 percent.
Based on AlixPartners’ analysis of UK ONS retail sales and consumer confidence data, this forecast mirrored findings from the AlixPartners 2025 Global Consumer Outlook, which recently surveyed 2,000 UK consumers on their intended spending for this holiday period.
The outlook revealed that only 13 percent of British consumers plan to spend more on food this Christmas than last Christmas. Fifty-five percent intend to spend the same amount as last year, while 21 percent intend to spend less.
“With the legacy of inflation continuing to bite and consumer confidence holding back spending, this Christmas is set to be a subdued affair for grocers,” said Matt Clark, Head of EMEA Retail at AlixPartners.
“Last month’s Budget brought difficult news, with many preparing to take a significant financial hit due to the National Living Wage and National Insurance Contribution increases. Therefore, a good ‘Golden Quarter’ has become more important than ever.
Clark said there was still some hope on the horizon for the industry. The increase in the National Living Wage should create a small window of optimism for lower-paid customers, during which those consumers will feel more able to spend.
Grocers should grab this opportunity, as it is unlikely to last given likely price increases as costs are passed on. Those businesses that can move fast and decisively may yet be able to retain or grow their share of the wallet over the festive period.
“The increased pressures on profits means it is unlikely that we will see a reduction in turnaround or transformation activity as we move into next year. In this vein, agility remains vital, with all businesses needing to be prepared to make tough decisions and to adapt and innovate at pace in the weeks and months ahead.”
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